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Why Are People In Bc Thinking Twice About Buying A Home?
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Are you ready to buy your first house? Or maybe you are ready for your next income property investment? No matter which, buying a home is one of the biggest purchases that most people make. This is why you must protect what you have. No matter what the market is doing, don’t forget about – it’s as important now as ever.
Why now? The market for houses has changed since the federal government introduced the mortgage stress test. It was meant to be a helpful measure, and whether it was or not, it has had an impact on sales and costs of homes across Canada; especially in British Columbia, which has always been a market that varies widely from one part of the province to another. In February of this year, for example, there were 4,533 home sales listed, and that adds up to 27 per cent less than there were at this time last year.
As to the cost of these residences in BC, that has also dropped down 9.3 per cent from last year. This is because of the mortgage stress test, says the BC Real Estate Association’s (BCREA) deputy chief economist, who further notes that even though the province’s labour market is strong, home buyers are being scared away.
The intention of the stress test was to help prospective homebuyers be sure that they could afford all their monthly payment obligations even if mortgage rates were to go up, and borrowers were forced to pay 2 per cent more per month for the term of their mortgage. Instead of making home ownership simpler, the stress test has made things more difficult, and so the BCREA would like to see it reconsidered, or better yet scrapped entirely before more people in the province are left behind.
This is significant for first time buyers as the price of entry level homes has not fallen as much as it has for the higher-end homes. The biggest price decline was in Greater Vancouver where the price decline was 11.5 per cent due to reduction in sales of the more expensive houses.
What is being affected?
It’s not just the real estate market that is suffering as people are buying less. The stress test is impacting spending overall as people are worrying about home equity and are cutting back all over. For that reason, if you do take out a loan to buy a house, insurance on that loan is not an option or even something the bank just requires. The insurance is there for the benefit of you and your family.
House insurance in BC matters
High mortgage or not, home insurance in BC is still important.
Lenders usually require everyone who does not buy their home outright to have mortgage insurance, and that is because damage to a property can affect the market value if the borrower can’t afford to repair it.
Property damage or loss is a huge expense, and the more expensive the home, the bigger the loss and the expense. So, home insurance in BC is beneficial at all times, whether the property is owned outright or not. There are types of house insurance in BC that cover damage from disasters of all kinds, no matter how unexpected, and going without insurance is never a good idea. Even if you own your own home, the loss of it would still be a great deal to bear.
Home insurance in BC doesn’t just cover the building and the land, it also can cover the contents of the house as well. That means, your house insurance in BC could also cover your belongings inside the house.
When you are considering home insurance in BC, ask as many questions as you can and don’t be afraid to get the information that you need in order to protect your investment. You can also check online at InsurEye’s website. It’s full of helpful information and useful tips for everyone who is or isn’t an expert in this business. Here you’ll find quotes, insurance company reviews and more – you’ll find everything you need to make the best choice when looking for home insurance in BC.
Hi, I'm Stevie! The management of personal finances is something I've been very interested in since my high school years. I'd like to share some knowledge on the subject and I really hope it'll help someone.
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