Don’t get too comfortable with your millionaire status or other price inflation if the 2018 BC Assessment numbers show a jump in your properties’ value.
Prices are based on sales from last year and prices could also stabilize or drop in the coming months if fewer people can buy homes or have to lower their expectations because of a new mortgage rate stress test that came into effect Jan. 1.
The new rules require financial institutions to screen applicants seeking uninsured mortgages for rates 2% higher than their contracted rates or the equivalent of the Bank of Canada five-year benchmark, resulting in result in less buying power this year for some people compared to 2017.
Under the new rules, some prospective home buyers will be forced to opt for cheaper homes or will have to stay out of the market entirely, which could have a downward pressure on prices if sales slow.
Still, assessments continue to defy the odds and are rising to the stratosphere, suggesting that homebuyers with average salaries are coming up with creative ways to get into the real estate market. It's likely they will continue to do so, despite changes in the rules.
