Our second Diversity TV Monthly segment on Real Estate Updates of super realtor, Conrad Aglah with URBAN Real Estate Services Ltd, amongst the Top 5% of all Calgary area REALTOR®s. Conrad shares his characteristic rich and inspiring Real Estate updates….
“The Alberta Real Estate Market continues to be heated with listings selling as fast as they are listed. Builders are also running out of lots to build on with increasing prices, some builders are even slowing down on how much lots they release or selling. This is creating lots of stress for buyers.
YEAR OVER YEAR PRICE INCREASES up to 10% at least in Edmonton, Calgary and their surrounding communities. The factors contributing to this are:
1. Pent up demand from the Pandemic.
2. Shortage of Housing Inventory both in the US and Canada.
3. Low Interest rate environment (both US and Canada).
4. Increasing cost of building/construction materials including lumber, paints, iron/metals, glue etc.
5. Increasing cost of labor (trades shortages).
6. Increasing employment prospects.
7. Overall impact of recovery from COVID-19, with vaccination gaining grounds all over the world.
BANKS/LENDERS/MORTGAGE
Due to these high volume of purchases, Banks are also overwhelmed couple with the up coming Stress test change due to take effect from June first for Uninsured mortgages (mainly mortgages with 20% or more down payment) and Insured mortgage (mortgages with less than 20% down payment). The new stress test rate is moving from 4.79% to 5.25% that will lead to a decrease in purchasing power for such purchases or refinances by 4%.
FIRST-TIME BUYERS
Its important to not lose focus of why you are buying a home i.e. to have shelter and build equity. Often this might not be your dream home but does it meet your fundamental needs for a home?
If so then go ahead. Ensure you are pre-approved, saved enough for down payment and closing costs and are working with great mortgage brokers and experienced real estate agents. A lot is happening that you cant afford to make a mistake at a time like this.
SELLERS
Should not wait unnecessarily long to list if you plan on selling. What goes up must come down. Do you numbers or have an experienced agent and your mortgage broker help you run the numbers so you can decide if its good to sell now or wait. Also you might want to upsize or downsize and its good to plan those sooner rather than later.
INVESTORS
There is no better time than now to access your plans and once ready, get the property that fits your investment goal and you will be aided by favourable economic factors/fundamentals. For example, Canada has a housing shortage and with an ambitious goal to bring in over 400,000 new immigrants per year for then next few years, you are on course to build a portfolio of real estate assets that would keep producing income and building equity for you over the long term”.
Watch Conrad on Diversity TV here https://www.youtube.com/watch?v=a3u8Swpk23U&t=3s
