Low mortgage rates and more affordable homes are pushing first-time homebuyers to enter the market in droves, Canadian real estate experts say.
Phil Soper, president and chief executive of Brookfield Real Estate Services, said when the Canadian housing market was hot, bidding wars forced many buyers to put in offers without conditions.
This, combined with unprecedented increases in home prices, scared many first-time buyers, he said.
But he said the economic downturn changed all that. As housing prices fell and lenders lowered their mortgage rates to attract borrowers, the market became much more attractive to people looking to buy their first homes.
BMO senior economist Sal Guatieri said he expects resale prices to fall “moderately further” this year for a cumulative decline in prices of approximately 20 per cent, but he said the slump in prices is slowing as buyers respond to renewed affordability in the market.
Brad Lamb of Toronto-based Brad J. Lamb Realty said sales in March through the Multiple Listing Service fell by only seven per cent, compared to drops of 45 to 55 per cent in previous months.
And the average time it took to sell a home in Toronto dropped to 39 days in March from 45 days in February, he added.
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