05 Jul First-Time Buyers are in the Driver’s Seat!
It’s no secret that we had a slow start this year in the real estate market, but with change comes opportunity. Inventory rose, prices stabilized, and most importantly, first-time home buyers took note.
According to the Canadian Association of Accredited Mortgage Professionals (CAAMP), nearly half of the homes purchased over the last 24 months were bought by first time buyers. Those that were hesitant to take the leap during 2014’s aggressive market have welcomed the slowdown. This spring, they had more to choose from and less pressure from competing offers. Coupled with rock bottom interest rates, it is shaping up to be an excellent year to be a first-time buyer.
Results from one of the country’s leading mortgage insurers, Genworth Canada, demonstrated similar findings. According to their research, Calgary’s new home builders were among the busiest in the country, second only to Vancouver. 31% of the first-time home buyers that responded to their survey stated they were focussed on the new home market, as opposed to purchasing a re-sale property.
Access to information and social networking has given potential buyers plenty of resources to educate themselves before taking the plunge into home ownership. They are taking their time, saving up as much of a down payment as possible, and carefully evaluating their priorities.
Although condos and townhomes are often the most affordable options for those entering the market for the first time, we are seeing a large percentage of new buyers setting their sights on detached dwellings. Buyers recognize that if they can afford a home that will meet their needs for the long-term, it is often more cost effective to look for a larger place.
Parents are still playing an active role in helping their kids’ transition from their basements into their very first purchase. About 2% of new home buyers receive financial assistance from the Bank of Mom and Dad. Even if the kids are doing it on their own, it’s not uncommon to see new buyers bringing their parents to showings to get their approval before making an offer.