Is It a Good Time to Buy a House in Edmonton?
Trying to predict the future of the housing market is never an exact science, and that’s especially true for 2020. Back at the beginning of the year, nobody could have foreseen the arrival of COVID-19 and the huge effect it had (and continues to have) on our economy.
This provides a particularly unique challenge to homebuilders and our clients – people still need a place to live so the whole housing market can’t simply shut down.
But self-isolation and social distancing affect almost all aspects of the home-buying process.
So does it make sense to buy a home in Edmonton during the current climate? Let’s take a look at some of the current events that are affecting home buyers, and what these can mean for the immediate future.
You Can’t Buy A Home In The Traditional Way
Here at Sterling Homes, our top priority is to keep people safe while they buy a home from us. Because of this, we’ve had to make some big changes to the way we show our homes. As well as rigorously cleaning all our showhomes in between viewings, we’re conducting self-guided and virtual showhome tours, as well as restricting the things that people viewing the homes can touch and interact with.
Because of this, you may find that it takes a little longer to arrange a viewing than it would do under normal circumstances, but we ask you to bear with us, as this is for everyone’s health and well-being.
We’ve also made some big changes to the way you’ll actually pay for your home and sign the documents once you do decide to buy, which we’ll cover in more detail below.
Does It Make Financial Sense To Buy Now?
From a purely financial perspective, there are actually some big benefits to buying a home at the moment. The government has lowered interest rates in response to the COVID-19 epidemic, so you could be able to get an even lower rate on your mortgage. This is also good news for existing homeowners who might be looking to refinance.
The banks are also allowing for mortgage payment deferrals in order to give people some more breathing room during the crisis, so it couldn’t hurt to check with the bank to see if you’re eligible. However, be aware that if you’re currently applying for a mortgage, the credit checks might be a little more strenuous than usual due to the current financial instability so make sure you have everything in order.
Is There a Difference in How the Down Payment Works?
When it comes to securing a down payment, the process is still largely the same. If you’ve already saved up enough, you’re good to go. If you’re still saving, you can keep using the same government programs that were in place to help you before.
These programs include the First-Time Homebuyer’s Incentive, the Home Buyer’s Amount, the Home Buyers’ Plan and the GST/HST Housing Rebate. For more information on these programs, take a look at our Guide To Down Payment Basics.
Will House Prices Go Down?
One of the good things about the housing market is that it tends to be very stable, and doesn’t fluctuate quickly in response to current events as, say, the stock market would. Of course, at this moment it’s impossible to say how quickly it will take for the COVID-19 crisis to be resolved – if we’re lucky it’ll be over relatively soon and everything will return to normal. In this case, there’s little to worry about.
If the crisis does continue on for an extended period of time, it’s possible that there might be a slight shift in the market in the short term, but again this will likely recover once the crisis resolves and things start to settle down again.
How Do I Buy A Home?
Showhomes aren’t the only area where we’ve had to make big changes – we’ve also had to overhaul our buying process. Once you do decide to purchase a home, you can now go through the sales process online via our website, and you can even sign the final documents online.
Once this is completed, you’ll still have to move in, which presents its own set of challenges. We’ve got you covered here too – take a look at our Guide to Moving Safely During The COVID-19 Crisis to find out how to make this process go much more smoothly.
As you can see, there are certainly a few challenges when it comes to buying a home in the current climate, but it’s by no means impossible. In fact, in certain circumstances, there may even be some advantages. While it’s impossible to say exactly what the next year or two might bring, history has shown that housing is an extremely stable investment and one that can grow a great deal over time as you start to build equity.
If you feel that now might be the right time for you, get in touch with us today and speak to one of our Area Managers to find out how the current situation might affect you.
Originally published April 2, 2019; updated May 29, 2020.