The threat and impact of COVID-19 is so vast and unpredictable to many of us at this time. Our national and global economy is disturbed by it beyond imagination, including and not limited to the real estate sector.
In Toronto, since February, we were slowly recovering from the 2017 real estate hit with a great start, and now we don’t even know how deep the real estate crash would look like this time around.
We see more and more, buyers that are holding off on their home purchase during uncertain health and economic conditions. They are hesitant to proceed with a home purchase now, as their employment and income could change tomorrow. They are afraid of losing their jobs in the near future, which would impact their ability to secure mortgage financing, and/or make the monthly shelter cost even if they get through the whole process of mortgage approval, purchase and closing. Nowadays, buyers are simply worried about losing all of their savings with the market downturn, or they don’t want to put themselves at risk to look at homes. So, the buyers who don’t have urgent purchase plans will most likely stay on the sidelines for now till the situation changes.
However, there are “highly motivated” buyers who will and need to buy in the near future no matter how long the deep downturn lasts.
There are buyers who have already sold their homes, and have to buy a new one within the next 30-90 days.
There are buyers who have relocated for work, have gone through a divorce and need to move on with their life, or simply planned their life to right size, downsize, upsize now.
There are also speculator buyers, who find the current situation a golden time to buy assignment or existing projects at discount, rent, renovate, hold and/or flip them, when the market picks up again.
Finally, there are those lucky first home buyers who have both job security and savings. The housing prices have gone down, and this is their perfect time to purchase a home, almost like winning the lottery.
The Central Bank’s emergency rate cut can and will definitely encourage these “highly motivated” buyers to take advantage of the lowest mortgage rates in decades.
Which category do you fit in under? Call us If you have any questions about how and where to start.
With love and gratitude