Surrey Real Estate in 2025. Top 5 tips.

Dear Clients, Friends and Neighbours,

The Bank of Canada (BOC) reduced interest rates again!

The fifth cut in a row, the BOC reduced rates by 50 bps on December 11th bringing the overnight rate from 3.75 to 3.25 per cent.
 
In recent years homeownership has become the impossible dream but there is much good news in the pipeline. 

Here are our top 5 tips and considerations for those looking to enter the market or renew their current mortgage …

1. Ongoing Interest Rate Cuts.  The BOC expects inflation to average close to its 2 per cent target over the next couple of years.  With both the economy and inflation undershooting the BOC’s expectations policymakers are eager to get the economy back on a path to recovery.  Considering the economies current trajectory and some looming risks re: threats of incoming tariffs from the Trump administration it’s likely the BOC will have to continue making cuts.  According to the British Columbia Real Estate Association we can expect the BOC to cut to 2.5 or 2.75 per cent in early 2025.

2. Reduced Down Payments.  Currently those looking to purchase a home under $1m can make a down payment of less than 20 per cent provided they take out mortgage insurance. (CMHC) However, starting December 15th, these rules will expand slightly for homes valued up to $1.5m.  This means down payments will drop significantly for those of us who live in high-cost areas in the lower mainland such as Surrey, South Surrey and White Rock.

3. 30 Year Amortizations Expanded.  Back in July the government announced lenders could offer 30-year-amortizations on insured mortgages for first time buyers looking to purchase new construction.  As of December 15th, this measure will be extended to all first-time home buyers and all buyers of new construction.  Stretching mortgage payments over a longer period (30 years from the current 25) helps to bring down regular mortgage payments for borrowers.

4. No Stress Test for Mortgage Renewals. As of November 21, any borrower looking to switch their mortgage to another lender upon renewal will no longer need to undergo a stress test.  This change applies to insured and uninsured mortgages and enables more of us to switch to a provider that better meets our mortgage needs.

5. Existing Programs and Tax Benefits.  There are other ongoing programs that can help first time homebuyers afford their first home.  These include the First Home Savings Account FHSA, the Home Buyers Plan HBP, the First Time Home Buyers Tax Credit HBTC, New Housing Rebates on GST/HST and lastly, Land Transfer Tax Rebates.

 
Mortgage rates and rules are an especially hot topic right now as we head into what may be the busiest spring market we have seen in the last 2 years. 

Buying and selling is typically quiet at this time of year but its worth noting that sales in November were higher when compared to the last two Novembers. 
 
It would seem overall activity is finally picking up as buyers gain confidence. Increasing demand and the typical decrease in inventory we see over the holiday season will likely spur on a quick start to the spring market in 2025.
 
If you have been thinking of a move in the new year its time to buckle up.
 
We can help you get back on the track..  It’s what we do.
 
Book your no obligation, home evaluation now.
 
Jenn & Colin