*Graph from Hubrate
For home owners that bought their homes between three and five years ago and have their renewals coming up are having to deal with some serious questions and concerns.
The borrowing cost of a $1,000,000 mortgage based on interest rates looks as follows (based on 25 year amortization rates):
1% = $3,767 per month
2% = $4,234 per month
3% = $4,732 per month
4% = $5,260 per month
5% = $5,816 per month
5.5% = $6,103 per month
If your mortgage was at the $1,500,000 mark.
1% = $5,651 per month
2% = $6,351 per month
3% = $7,098 per month
4% = $7.890 per month
5% = $8,724 per month
5.5% = $9,155 per month
And if you home was at the $2,000,000 mark.
1% = $7,535 per month
2% = $8,469 per month
3% = $9,464 per month
4% = $10,520 per month
5% = $11,632 per month
5.5% = $12,207 per month
If you bought your home in 2019 your rates were likely in the 1% range and you likely paid around $2,000,000
for your home (average sale ranged from $1.5M to $2.1M).
If you bought your home five years ago, your mortgage interest rates are likely higher by roughly 2% to 3% and if you bought your home three years ago, in 2021, your rates are likely 3.5% to 4.5% higher.
While prices were dropping in the second half of 2023, banking and industry concerns were there was a potential for
mortgage defaults and a high volume of foreclosures.
As the market has corrected and rates are expected to come down, consumer confidence in our local market is high
and demand has started to push the prices back up.
The big question many three to five year home owners in the area are thinking, is what is my best course of action today.
The answer will have many variables and as your Upper Lonsdale expert, the first thing to do would be to consider where prices have gone, what is your property value today.... above all others, I can give you a very clear and specific answer. (I am doing between 2-4 home estimates per week in the area).
As Upper Lonsdale's Community Realtor, I offer free annual market valuations, home selling advice and strategies, and all our conversations and 100% private and confidential.
Call today to discuss your options and get your free home price estimate and valuation.
Kevin Lynch
Upper Lonsdale Expert and Community Realtor
604.307.9448
info@UpperLonsdale.ca