buying a house during a recession

from Green Mortgage Quarterly Newsletter

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So, you are considering buying a house but don’t know if buying one during a recession is the right move? Everything from interest rates to consumables and inflation is on the rise. This all leads to uncertainty but could it also lead to opportunity? If your finances are tight or uncertain due to potential job loss or decreased income, it’s probably best to wait until the economy starts picking up again. Of course, this could be an excellent opportunity for those who don’t need to worry about their current financial situation and may be looking for long–term investment options in an unstable market.

Current State of the Canadian Real Estate Market The Canadian real estate market is currently experiencing a slowdown. Due to stricter mortgage rules, higher interest rates, and inflation, sales and prices have decreased in some major cities, such as Toronto, Vancouver, and the Maritimes. However, the market is still relatively stable in some areas, like Edmonton and Calgary which still have pockets of growth.

What Are Some Pros and Cons to Consider? Pros • Lower prices: During a recession, prices for homes tend to be lower as people are less willing to pay high prices for homes, and sellers are more motivated to sell quickly. • More negotiating power: With less demand for homes during a recession, buyers can negotiate a better deal on the price of a home. • Increased affordability: Interest rates may also be lower during a recession, making it more affordable for buyers to take out a mortgage. • More available inventory: As people may be more likely to sell their homes during a recession, there may be more available in the market for buyers to choose from.

Cons • Economic uncertainty: A recession can bring uncertainty and instability, making it difficult for buyers to know if they are making a wise financial decision.

• Reduced income: During a recession, many people may experience job loss or reduced income, making it difficult for them to afford a home.

• Limited financing options: Lenders may be more cautious about offering mortgages during a recession, which can limit the financing options available to buyers.

• Depressed housing market: The housing market may be depressed during a recession, leading to lower property values and reduced demand for homes.

What You Need to Know It all comes down to whether you have the money to comfortably cover the costs and enough savings for a down payment. The Canadian real estate market is projected to drop back to around where it was before the pandemic.

Check out Canada’s best mortgage rates and talk to one of our experienced mortgage brokers to get personalized advice that can help make sure this important decision is one you won’t regret. Get started today—it could be your

best investment in 2023!

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COVER

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IN THIS ISSUE

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KYLE GREEN’S GAB

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WEBINARS

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OUR LATEST NEWS

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WHAT IS A SHORT–TERM RENTAL PROPERTY

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WHAT ARE MEDIUM–TERM AND LONG–TERM RENTALS

ARE THEY GOOD INVESTMENTS?

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AIRBNB AND VRBO

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CALCULATING CASH FLOW FOR REAL ESATE

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