The Toronto market has been flat through the first two months of the year, and lenders’ forthcoming decisions on rate specials will likely determine whether or not activity increases through the year.
Amisha Mistry, a mortgage agent with Sherwood Mortgage Group, blames the slow market on the recent string of government intervention in the market, but believes lenders’ rates will decrease over the next couple of weeks.
“I haven’t done as many feature sheets because I think people are just waiting to see where the market lands,” she said. “But it looks like rate specials will come down next week. It will maybe give people a little more momentum to go out and buy. A lot of people are speculating on the state of the market right now.”
However, Wasah Malik of King Capital Lending doesn’t think rates will come down. The confluence of B-20 and rising interest rates has left everyone in a haze.
“The old industry is going through a shakedown and even lenders are confused and unsure of what to lend on, so everybody is scaling back, and I’m not even sure what specials will be out,” he said. “The problem this year is the whole shake up of the industry. I’m not sure if crazy specials will come out. I’m assuming they’ll increase.”
Malik added that while it’s too early to say, King Capital isn’t likely to increase lending rates. In fact, it’s pursuing rural markets in Ontario because they’re usually neglected by lenders.
“We haven’t decided on increasing rates—I personally don’t feel like increasing rates because I think they’re quite high—but we are adding new products to accommodate rural properties in Ontario where larger banks are shy to lend. We’ll be lending at 80 LTV. Instead of raising rates, we’re launching new products to accommodate underserviced markets, and because all the lenders are scaling back, this is our mandate: We want to service areas others aren’t serving.”