The Big Story: Fighting doom and gloom
The real estate forecasts of some big players have receive even bigger media attention. That's bad news for brokers sitting on preapprovals. But there is a way to encourage ready buyers into the market.
Video transcript below:
Reporter: Thanks Moody’s and thanks TD while we are at it. Talking up pre-approved clients down off the fence is a lot tougher, thanks to your doom and gloom forecasts. But brokers it can be done. Welcome to fence sitter no more on the Big Story. 10 years in the doldrums, that’s the latest prediction for Canada’s real estate market. Well, according to TD, Moody’s goes one better. It says prices are inflated by more than 25%. It’s all enough to keep brokers sitting on a mountain of pre-approvals and it’s enough to keep fence sitters out of the market. But should they be?
Drew Donaldson, Exec. VP of Sales, Safebridge Financial Group
Drew Donaldson: As far as doom and gloom predictions by the likes of TD and Moody, well we see with our clients, I mean if you are first home buyer sitting on the sidelines and you think for the next 10 years either the prices are going to fall or remain stable, we say if you are financially prepared and ready, then absolutely you are free to jump into the market and we actually recommend it. At some point in your life, you have got to get into the housing market. Now, if you are one of those investors who has 4 or 5 properties and you thinking of, let’s just keep overleveraging all the way upto 7, 8, 9, 10 properties, I would think twice about that.
Reporter: But ultimately the decision to buy falls to the client. Still brokers should be asking the right questions to help them along.
Phil Edwards, Mortgage Broker, Mor Can Direct
Phil Edwards: Well when you hear those predictions of doom and gloom, I think you really have to analyse where the information is coming from and what we have to look at is, number one, how does it affect you as your being in the actual market. So look at for example where you are in the marketplace if you are in Toronto or Vancouver. Because a lot of times that those statistics are given out, it’s for Canada as a whole. So if you look at your specific market, you will be able to see if that actually relates or affects you.