Entry #2 - Canadian vs U.S. Real Estate Market

Blog entry #2

Propertywire.ca emails me their news letters on a regular basis.   Finding time to read them is a challenge, but I always feel compelled to share the info when I do make the time.  Two recent articles discuss the Canadian Real Estate market versus the American Real Estate market.  We have all heard some people’s strong opinions stating something to the effect – “Whatever happens in the U.S. will eventually happen here in Canada.  Therefore, our real estate market is doomed to crash eventually.” 

Well, I have always disputed such negative opinions.  We have a different banking system in Canada with regulations protecting Canadians from the pitfalls in which so many Americans have landed.  These two articles, titled “Might doesn’t always make right especially when comparing Canadian and U.S. real estate markets”  and “Flaherty’s Changes Impact Housing Market”  confirm this. (Check out our facebook site – Peter and Wendy Witt – to read the entire articles.)

 Canadians have a safe and strong real estate market.  We are fortunate to live in a country where we have the right to own our home, however, this right comes with responsibility.  Changes to Mortgage qualifications in our market will help Canadians avoid taking on more debt than they can handle and also encourage them to pay off debt faster.  Many Americans were allowed to purchase homes they couldn’t afford when times were good, and were not prepared when the economic climate changed. 

When purchasing a home, you must be aware of all costs involved, and have a plan for handling them.  Do you have a plan for paying off your mortgage?  What happens if you lose your job?  Interest rates are very low now, but can you still afford your mortgage payments if rates are higher when it comes time to renew at the end of your term? Are you responsible enough to be a homeowner?

Few investments match the benefits of home ownership. Home owners can invest in themselves, take advantage of capital gains, build equity and house their families.  But it is not an investment you should walk into with your eyes closed.  Knowledge is power.  If you are thinking of buying your first home, and have questions, please give us a call. We love to share!