The Lacombe market continued its slide in October with sales hitting the low point for the year, and while a lower active listing count should have helped the sales to listing ratio, it also hit the lowest point in the year at just 5%. That 5% sales to listing ratio gave buyers a huge advantage in October. A sales to listing ratio of 25 – 30% would be ideal, where neither Sellers or Buyers have the advantage, so we have some room for improvement.
In spite of a slower month in Lacombe, the Alberta economy continues to show signs of improvement which should contribute to eventual gains in the housing market, although there are still some headwinds. In an effort to curb rising house prices in Toronto and, in anticipation of higher interest rates, the federal government has once again tightened mortgage rules for all Canadians. Buyers with more than 20% down will now be required to qualify for financing at the Bank of Canada’s posted rate of 4.95% or 2% higher than the actual rate on their mortgage (whichever is higher) effective January 1, 2018.
Homebuyers who will be affected by the new rule should consider whether buying before Jan. 1st is in their best interest. Home sellers will also be affected by the new rules as those buyers will now qualify for lesser mortgage amounts.