If you are looking to buy, the real estate market is indeed in your favour right now.

Randi Senos and Stacey Scott, Licensed Mortgage Associates with Unbeatable Mortgages say while mortgage rates are not necessarily unstable, they are unpredictable. “If you had asked me six months ago, we had every indication that rates would be increasing, but in the last four to six weeks we have seen massive drops in our rates.”

Scott believes the cuts are due in part to stimulating the market and the realization that the overall economy just isn’t ready for a jump in rates. “We had many lenders predicting that coming into this spring we would be at 4.04 to 4.14%, while we just had a special release at 3.29.”

Over Scott’s thirteen year career, she has always felt she had a good grasp on what was coming down the pipeline, but these days she finds it quite challenging.

For the most part, gone are the days of the speedy quick mortgage approval, share the team. Changes implemented by the government has forced them to become more creative and take a look outside the box when seeking approvals. “As the government has made those rules our lenders, banks, and credit unions have been good at helping us navigate these changes.”

The stress test has also impacted approvals, knocking close to thirty percent of mainly first time homebuyers, out of receiving approval across Canada. While the implementation of the stress test was meant to protect, it just means the approval process is quite different. What used to be a couple of week approval period has now turned into long-range planning.  “Things have changed for us. It used to be clients would walk into our office, and they would be looking at buying that week. We would be initially meeting with them that first time, they would go through the process in a couple of weeks, and then maybe we would see them at their next home purchase. Now it is more people coming in, saying I am planning on purchasing within the next year, putting them on track, and helping with their budget.”

Depending on the portfolio, sometimes Scott and Senos encourage applicants to lower their debt ratio to help them with the approval process. “It is really about moving those numbers around and making sure that what they have worked so hard to save up for is being used to the best of its ability.”

While unfortunately, some deals have fallen through due to loss of employment, more often than not, the answer is usually just ‘not now,’ rather than a flat out 'no.' “In most cases, if we are not approving someone and they are close, we are helping coach and make a plan. We have a great financial planner that we can refer to and help strategize. It’s not 'no'; it’s just not right now.”

The federal budget did bring about some changes that first time home buyers should be in the know about, share the ladies. 

  • As of March 19th, the Home Buyers Plan was increased for first time home buyers. Individuals can now withdraw 35,000 dollars (up from 25,000 from their RRSP) or 70,000 dollars if applying jointly with a partner. In hopes the adjustment allows for greater access to RRSPs to purchase or build, the advantage is the ability to withdraw the funds without getting taxed, and instead, being able to pay the money back over 15 years. The ladies share that while they don’t necessarily have a lot of client’s with 35,000 dollars in RRSPs at their disposal, it is available. Make sure to touch base with your provider in regards to regulations and whether you meet their eligibility. 
  • They are looking at making an exception for first-time home buyers to qualify for a thirty-year amortization.
  • And, although another incentive is supposed to come into effect this fall, details of what's to come, is still in preliminary stages. "We have very minimal details. They are looking at where they would lend 10% down on a new build to a first time home buyer or 5% down on a regular home to a first-time buyer, but we don't know what a first-time buyer means or what that looks like. We have been told that it would mean CMHC (Canada Mortgage and Housing Corporation) would lend you the down payment or add to it, and at this point, we understand that would go on the title, and they would have interest in your property."

The best way to qualify for a grassroots traditional mortgage is to have a strong credit rating, and a good amount of cash tucked away for the down payment, say Senos and Scott. If you are looking at getting into the real estate market, even if it's a couple of years out, you can call Senos or Scott for advice at 403-850-7738.

"It really is a good time to buy if you are in that position to purchase right now. We're seeing sellers really negotiable on price, and while the media may paint a doom and gloom picture, we are finding Cochrane is holding nice and steady."