To Buy or Not to Buy, That is the Question

Times are tough, everyone is tightening their belts these days.  In addition to us realtors who are caught in the middle of what everyone is suggesting, is a major economic crisis.  Where are all of you buyers that up to 6 months ago, when prices were so inflated, that you’d be lucky if you kept your shirt when bidding on a property.   Now is the time, for you to get in on the action.  I hear everyone moaning and stalling, the only truth we know right now is that mortgage rates are at a historical low, with more tax breaks then before I can’t seem to get through to you first timers that now is your time!! Everyone is waiting for the bottom to drop out of the market, but remember that real estate is not like the stock market, we are talking about a tangible asset, that at any given moment if the wind blows the right way again we maybe headed back up again.   I’m not suggesting that this is the right market for a speculator mind you.  But if you want to get into home ownership, and expect to hold onto the property for 5 years, you are going to be on the right side of the fence if you take advantage of this market now.

Stimulus Package???

Now that President Barack Obama’s $787 Billion Economic Stimulus Bill has been signed into law and will take effect on March 4, many American homeowners are anxiously wondering how this bill may affect the housing market. Despite primarily focusing on bolstering the economy by creating jobs and reviving spending, the bill includes steps to revitalize this critically important segment of the American economy. But what impact will the stimulus package directly have on your mortgage?

President Obama’s plan, named the American Recovery and Reinvestment Act, is designed to address two groups of homeowners: those who are current on payments but have high interest rates and not enough equity to qualify for refinance, and those who are at risk of losing their homes. The plan also intends to provide $200 billion in additional financial backing to Fannie Mae and Freddie Mac to increase money available for home lending.

These steps will directly help homeowners and new home buyers seeking a new mortgage, says Michael Isaacs, president and CEO of Residential Finance Corporation (www.residentialfinance.com), a nationwide mortgage lender specializing in FHA refinances. “The stimulus package aims to make money more readily available for lenders to help those who are currently in need,” says Isaacs. “The American Recovery and Reinvestment Act will directly help those seeking to refinance out of bad mortgages as well as those looking to become homeowners for the first time.”

GTA REALTORS® Report 2,670 Resale Housing Transactions in January

TORONTO – February 5, 2009 — TREB Members reported 2,670 sales in January from the 5,075 sales reported in the first month of 2008. Of these, 1,106 transactions took place in the City of Toronto compared to 2,128 in January 2008. In the surrounding “905” area, 1,564 sales were recorded, from 2,947 last year.

The GTA housing market has not been immune to the economic slowdown in Canada. Some potential home buyers were less-certain about their positioning in the economy over the past year. Until the economy rebounds, and along with it consumer confidence, the number of existing home sales will be more moderate in comparison to the average over the last ten years.

Home prices also moderated in January. The average MLS selling price dipped to $343,632. The average price was $364,415 in the City of Toronto, from $404,202 in 2008. In the surrounding regions (“905” area code), the average price was $328,935 from $352,965 last year. Buyers have experienced more choice in the existing home marketplace. Lower selling prices have resulted.

It should be noted that the GTA housing market has followed the broader economic slowdown, but was not a cause of the downturn. Home prices remained affordable throughout the new millennium. The average family can still qualify for a mortgage on the average priced home. This remains the case today. Given that we are not facing an early-1990s-style affordability crisis, the rebound in the housing market will likely be quick once economic recovery takes hold.

Median Price

The median price in January was $303,000 from the $319,000 recorded during January of 2008.