How will 2016 end for the Vancouver Mortgage Market?

Affordability in housing is an important reason that many choose the Vancouver region as the place to call home. While it remains to be seen how Proposition One which was approved by voters in Vancouver’s city limits will impact affordability of those residing within the city; it is clear that the larger national picture will impact us with a slightly rising interest rate and potentially friendlier regulations. These factors will ultimately impact our local market more as it is determined whether rising interest rates are here to stay.

When one piece of the affordability factor changes such as a potentially increasing interest rate, the impact upon the price of housing is usually to decrease over the long term. The low rates that we have been experiencing continue to allow many people to purchase a more expensive home than would otherwise be possible. Two weeks ago last Thursday; we saw mortgage rates hit 3.87% from Tuesday’s market close of a quarter of a percentage lower.

Today, local mortgages remain affordable and so are the homes that can be purchased in our area. Acting now makes moving into a refinance or a new home purchase smart;
however, once the interest rates begin to take hold at these slight rises, the long term impact can make housing less attractive because of the impact higher interest rates have on housing costs. Typically housing prices will decrease over a long-term rise in interest.

The regulatory market which is the other factor I mention in this article will give us take a little longer to decide how the mortgage industry is impacted as a whole. For Peak Mortgage, we are happy to not be a member of the Big Bank club. The biggest banks have faced great regulatory risk and are still impacted in lending because of the lending that happened in recent years.

The good news is that you have time to buy in 2016 or refinance. I encourage you to look for my next article in the Columbian’s Home Book which will issue on the first Saturday in December’s newspaper.

We lend where we live,

Michael Pattullo
MLO# 229675
Mortgage Advisor
360.607.9312
mpattullo@peakmtg.com
Peak Mortgage
Peakmtgnw.com