Milton Mortgage Broker – James Loewen
As Milton mortgage professionals, our team is dedicated to helping you get the best deal while saving you money.
The Canadian Mortgage and Housing Corporation is keeping the country red-flagged when it comes to the housing market.
Three months ago, CMHC said that it was red-flagging the housing market due to the strong conditions of the market that are bound to create problems. CMHC is keeping the country on watch for the second straight quarter because of overvaluation and the quick-rising prices of homes, according to an article on the Financial Post.
The big concern mainly lies with cities such as Toronto, Hamilton, Victoria and Vancouver. In these cities, the average home price is rising very fast and there is worry that it is outpacing factors such as employment and income, meaning that people are at a higher risk of getting way in over their heads when it comes to homeownership.
Toronto and Vancouver have been at the forefront of inflating home prices for months. While prices in Vancouver have cooled down somewhat lately, there is still great concern. In the Financial Post article, the Royal Bank of Canada stated that the positive outlook for oil prices have led to developments for housing risk in provinces that heavily rely on the oil industry, such as Alberta.
In a quarterly report conducted by CMHC, called the Housing Market Assessment, market conditions are ranked on four categories, including overheating, overbuilding, overvaluation, and price acceleration. Each category is then ranked as weak, moderate or strong.
In the latest report, six cities fell into the red zone. The red zone is for cities which indicate that there was evidence of conditions that could turn problematic. Both Toronto and Hamilton were listed in this zone for the second straight quarter.
With market reports for the first month of 2017 due in the next couple of weeks, we can begin to monitor and compare housing trends with past years. If the market carries over the momentum created in 2016, more problems could be on the horizon that CMHC must deal with to prevent a crash.
In Milton alone, the median sale price on a residential home jumped from $499,450 in December 2015 to $657,450 in December 2016.
If you’re looking at buying or selling a home in the area, especially one as busy as the Greater Toronto Area, talking with a qualified Milton mortgage professional at Loewen Group Mortgages can help. Whether it’s buying a home, refinancing a current mortgage or renewing one, we can help.
For more information on how the team can get you the best deal for your situation, contact them today!