Immigrants made best use of slowdown in Housing Market
By Natasha | Sat, 10/10/2009 - 17:50
An internal study by Canada Mortgage and Housing Corporation has shown that more new immigrants are becoming homeowners and they are buying this in first three years of landing in Canada.
The results came from the study of immigrants’ home buying patterns in Toronto, Vancouver and Montreal at different points in their first four years in Canada. 17 percent of the immigrants negotiated their first house within six months of landing.
By an estimate, about one third of the real estate deals in Canada in last two years were done by new landed immigrants.
In fact, despite the slowdown, the areas in Canada those were favorite of immigrants as Surrey, Delta and Newton in Vancouver and Brampton in Toronto actually witnessed a pronounced undersupply of homes for sale. With the recession retreating, the report found that home prices are stabilizing and unit sales are increasingly driven by improved affordability.
The shortage in housing supply in several cities as Toronto, Richmond Hill, Markham, Montreal, Calgary, North and West Vancouver, and Victoria has led to bidding wars.
As most new immigrants in Canada don’t have deep pockets or a sound credit record, single family and semi-detached homes are their initial favorites. Prices for these houses have registered increase over the previous quarter numbers. Canada's capital saw standard two storey homes increase 3.3 per cent year-over-year, to $327,833, while similar homes in Winnipeg increased 5 per cent to $265,938. Montreal home prices also continued to improve, with a year-over-year increase of 2.1 per cent for standard two storey homes, at $343,480, and a 4.4 per cent improvement in standard condominium prices, to $213,278.
Though today's low interest rates have made buying that first home easier, Real estate buyers are much discerning lot too. Before buying a house, most of them have carried on complete study about negotiating a mortgage as break fees, Pre-payment privileges, and various penalties that could be charged by the bank.
They also do complete homework on making an optimum down payment so that they don't have to carry the extra expense of mortgage insurance from Canada Mortgage and Housing Corporation (CMHC).
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