Housing affordability improved modestly in the third quarter

The effect of the European sovereign debt-crisis in recent months has provided some unexpected benefits to the Canadian housing market in the form of lower interest rates, according to the most recent Housing Trends and Affordability report from RBC® Economics Research.

For example, fixed mortgage rates (on a five-year, posted basis) eased to 5.3% in the third quarter of 2011 from an average of 5.6% in the second quarter of this year.  This ran counter to expectations of generally rising interest rates just prior to this summer’s latest bout of global uncertainty.

These lower mortgage costs helped to reduce the costs of owning a home in Canada. As a result, housing affordability improved broadly, albeit modestly, in Canada in the third quarter (after two consecutive quarters of declining affordability).

At the national level, the RBC Housing Affordability Measures fell (a decline represents an improvement in affordability) by 0.2 percentage points to 29.0% for condominium apartments, by 0.6 percentage points to 48.8% for two-storey homes and by 0.7 percentage points to 42.7% for detached bungalows.

What does that mean for you?

RBC mortgage specialists understand the fine line that exists when balancing lifestyle needs and housing affordability. They will provide tailored advice on all aspects of financing your client’s home purchase. Furthermore, our ability to provide a quick turnaround means you can close the deal faster and get your clients into their dream home sooner.

Your new home doesn't come with mortgage advice. I do.

Contact me today:
Eric Dunham

Mobile Mortgage Specialist
RBC Royal Bank
(780) 370-6663
eric.dunham@rbc.com 

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Personal lending products and residential mortgages are offered by Royal Bank of Canada and are subject to its standard lending criteria