Kelowna, BC

The average residential home is expected to decline 13% to $396,600 in the province of British Columbia.

Residential sales are also being fore-casted to decrease by 9% from 68,923 unit sales in 2008 to 62,650 unit sales.

Cameron Muir, Chief Economist for BCREA says "Downward pressure on mortgage rates and lower home prices are providing much needed improvement in home affordability. Increasing affordability and significantly lower housing starts are setting the stage for a healthier market in the years to come."

I agree with Cameron Muir's assessment of the current real estate market in British Columbia. With average home values adjusting and consistent low interest rates, now is a terrific time to consider buying a home. The affordability of homes will benefit the first time home buyer or the move up buyer looking to upgrade from a condo or townhome into a house. Personally, I am finding buyers are starting to come out of the woods and write offers, some get accepted while others are just too low for the current market. Conversely, I am finding sellers are acknowledging that the real estate market favours buyers and are starting to price their homes accordingly!

Please note that it is very important to remember that forecasts are nothing more than a prediction and/or best guess and should not be taken as factual as even economists have been known to be wrong from time to time!

Full BREA article

Sincerely,

Jason Neumann

As a Realtor® I am often asked questions such as:

"How's the Real Estate Market?", "Do you think the Real Estate Market will crash?" and my personal favorite "What do you think is going to happen in the Real Estate Market this year?"

The track record of those who try to forecast the ups and downs of any market is exceptionally poor, so let's consider what is factual about the current real estate market in Central Okanagan currently. Certainly, it is much more of a Buyer's market than we have seen in recent years. Sellers also are starting to recognize the change in market conditions and as a result are reducing their asking prices to where Buyers are willing to purchase their homes.

Here are 6 reasons why now is a great time to buy:

1) Home prices have dropped by 10-15% over this time last year making it more affordable to buy today.

2) Selection is better than it has been for a very long time. Chances are that you will find the home you have always dreamed of owning!

3) Interest rates have fallen significantly over the past months. Banks have now passed on these rate reductions to the consumer which makes getting a mortgage loan easier and more affordable.

4) Rental vacancy rates are still very favorable to landlords especially in Kelowna. It is now possible to have a smaller monthly mortgage payment then it would be to pay rent on a home in many cases today.

5) The Central Okanagan continues to be a destination city and a must visit is still the destination of choice for many people which means that real estate should continue to be a solid investment.

6) "Move Up" Buyers now find themselves in a great position. The price on their ideal home has likely dropped in the last year by a larger amount than their present home.

These are just some of the many reasons why NOW is the time to BUY!!!

Sincerely,

Jason Neumann

...But it Works!

The following is a case study of a recent client who refinanced their mortgage through MortgageOpolis.

Case Study:

Clients purchased a home last year and currently has a mortgage of $150,000.00 at 5.90%, 5yr fixed term /15yr amortization and $650 bi-weekly payments.
We were able to obtain a lower rate of 4.39%, 4yr fixed term / 13yr - 8 month and by keeping the payment the same at $650... we were able to save the clients aprox. $22,000.00 worth of payments which included the pre payment penalty of $4400 and the closing costs of $1400... assuming the interest rate in 13 years, 8 months is 4.39% or greater.

More often than not, refinancing becomes a viable option when current interest rates are 1.5% or more below your existing interest rate. In the case study above, the clients also had another option to consider which would have reduced their bi-weekly payments by $40. A savings of $40 bi-weekly would amount to $4160 for the 4 year term. However, the outstanding balance on the new mortgage would be aprox. $2200 more than that of the existing mortgage. This would would net the clients a savings of $1940 over the next 4 years. Although both options offered a savings, the clients were comfortable with their current payment structure and chose to eliminate their mortgage sooner.

Another factor which makes refinancing favourable is debt consolidation. Large amounts of debt and payments can seem like an endless burden that never get paid off. Many consumer lending agencies will offer affordable payments, but, the result is basically the never never plan. Did you know? On average it will take a borrower 9 years to repay a credit card debt by just making the minimum payments? Astounding isn't it?

Having a qualified mortgage professional examine your situation, could save you thousands of dollars and help you pay off your mortgage sooner. In summary, if your mortgage interest rate is currently 5.79% or higher, or you have several consumer debts... it's time to refinance. MortgageOpolis offers clients no obligation proposals defining the best options for their clients.

- Dave Vrabic, MortgageOpolis

Canadian Mortgage Rates for January 27, 2009.
Courtesy of MortgageOpolis

Refinance your mortgage today to a lower rate and save thousands of dollars, of your hard earned money!


Prime Rate 3.00%
Variable Prime Plus .80%
1 year fixed term 3.50%
2 year fixed term 4.29%
3 year fixed term 4.29%
4 year fixed term 4.29%
5 year fixed term 4.39%
6 year 5% cash back 6.75%
10 year fixed term 6.35%


Rates subject to change without notice.

Steven Harper and his minority Conservative Government announced billions in tax credits for Canadians today! Finance Minister Jim Flaherty gave Canadians some good news as he went over the Federal Government's plan to kick start the stalled out economy. The proposed tax cuts and relief are aimed at getting consumer spending back up and instilling some confidence in the future.

Home owners looking to do some much needed renovations have a bit more incentive as the government has promised up to $1,350 in tax credits for home improvements between $1,000 and $10,000 made between Jan. 27, 2009, and Feb. 1, 2010. Perhaps, the best news of the day was the changes to raise the upper limits on the two lowest income tax brackets. The new tax ceiling for the 15% bracket would be $40,726, and for the 22% bracket a change to $81,452.

It is a good start but with a minority government currently in power this is far from a done deal. At any time the official opposition parties could push for a non-confidence vote and force Canadians back to the voting poles. Over the next couple of days we should see exactly where the opposition parties stand on the new proposed federal budget for 2009. Full CBC News Story

Sincerely,

Jason Neumann