Bought a house at premium? How to sail through?

House values go up and down but as long as you can afford your mortgage, don't look back and just be happy with your first house. In the grand scheme of things, your property will go up overtime and this is just a minor bump along the road.

did you buy because of FOMO?

1) Don't get a lot of what is said on the news and forums get into your head. Over the years, I have found a lot of mass hysteria leads to reality only a small percentage of time. Just because everybody is sh!t scared and buying toilet paper doesn't mean world is coming to an end. Often times I have seen the fears (recession, economic collapse, etc.) not materialize.

2) Remember, BoC has also the mandate for employment as well as inflation. This was added 6 months ago or so. If rates start impacting jobs, you'll see them back off.

3) A lot of people and governments are in debt. And inflation numbers are YoY. We'll very soon get past the hump and inflation numbers will come down. Look around you - milk jumped around a $1, yes. But it has stopped, it's not going up by $1.3, $2, $3, etc.

4) Gas prices have hit very high levels. But that's with a war. We don't know when war will end, but even in the unlikely even that it goes on for another year, the YoY numbers will start to come down. And so inflation pressure eases off. But in the likely even that war ends, then you'll immediately see a drop in oil prices and a significant drop in inflation. Which means the BoC will be able to ease off, and even drop its rates once again. OPEC may also start producing more as they have a vested interest in keeping prices in a range that allows the world economy to operate properly.

5) Your purchase is not even that high. With two people you will quickly save enough money to recoup any paper losses. Just yesterday people lost ~150k in deposits in a preconstruction TH investment in Richmond Hill. Or people who lost hundreds when prices dropped in 2017.

6) People are still flocking to this region and there is a limited supply of housing. And government has a vested interest in keeping their prices high so people vote them into office. So I fully expect new "policies" (ex., 40 year mortgages) to bring prices back up if it gets to it.

7) This region is still hot in demand and population increase will ensure that. So it's a solid purchase long term, and remember that *a lot* of jobs are directly related to housing in Canada. If rates cause that to go down, it will have a counter effect on the rates. So I don't think the rhetoric by BoC will amount to much. It's a lot of talk as they know that will cause people to stop over extending themselves. They might even increase it for a brief period to show teeth, but with the massive debt people have taken they'll back off within a year or two.

Hmm...how to sail through?

Get over it. Life is full of disappointment and regrets. You will have to learn to deal with it at some point. You tried your hardest and made the best decision possible at the time (I'm assuming that you can still afford the mortgage with rising rates). What happened with the market afterwards was out of your control. So you feel that you overpaid. Your wallet hurts and probably your ego too, but it's not the end of the world. If you continue to dwell on this and let it keep you up at night, you are going to ruin your health.

Uninstall REALTOR.ca or HouseSigma or any other housing app u installled .. focus on closure and congratulations on your first home here in Canada .. people like us are waiting for such moment from last few years .

There's no way to predict the future so I wouldn't worry about it too much. Off course it's easy in hindsight to say we should have done this and that.
In the long term you're not going to lose money so why worry about what your house will be worth in a few months unless you are already planning to sell?
As long as you can afford the mortgage and the house works for you then that's all that really matters.
You bought a house, that's a lot more than most would be homebuyers can say these days.
Let go of things you can't control you'll be much better off.

5- 10 years from now that $50k you believe you may have overpaid will be insignificant.

I've seen comps for units like mine go from almost 1.2m to 1.05m. I paid less but still not the best feeling

Best advice is to keep a long term outlook. 5+ years from now it will come out in the wash (or hopefully)

Plus this isn't your forever home. Price drops are not always a bad thing as long as when you sell you are above water. That means your next bigger home will also be more attainable, at least in terms of a mortgage

I'll echo everyone here. Most of us have reverse regrets about buying too late, had we bought earlier we'd have saved money. You go with what you got.

I will add, if you are entertaining the idea of walking on the deal, you can be sued. Search here for details, but they can sell for say 800k and sue you for the 170k loss. Be wary of the temptation to pull out.

Check the hot deal forum, lots of people have time machine there maybe try to borrow one from them.

Dude, I bought my house some years ago and it is a shitbox. I regret buying it. Not because of the price but because it is poorly built. Your house is a home 1st. If you enjoy it that is #1. If you can afford the payments and are planning to be there long term, nothing to worry about. Just stop looking at sale prices.

sufi22 wrote: ↑ I bought a house at a premium price in Kitchener. I bought it at 970k 3 weeks back and comparable homes are getting sold at 890s and 925s. With Rate of interests bound to go up, rates will definitely fall back to 800s-850s level.

While I can momentarily allay or assuage myself of my apprehensions by saying that this is my first purchase, primary residence, etc. We are a young couple, have secured jobs and will be left with good amount in monthly savings after the mortgage too but the mere feeling that our house is going down in valuation and that too when there are 3 months left to close is keeping me awake at night. Already had put 35k. Can't sell it before closing. Few weeks back, I was so wishing for house prices to come down but now I don't want them to come down. Strange though but true. This is my first house and I am not all happy about my decision.

I wish I had never made that purchase.

Yea, it sucks, but that's just life. Hindsight is always 20/20

But look at it this way, if you purchased it to live, then live there and make the most out of it.

So 3 weeks ago you didn't know that rising rates are, all else equal, bad for housing prices?

Dude, life is FULL of REGRETS and you probably overpaid a little bit in the January market frenzy, but who knows where market would be heading then as the bidders all assumed the price would have gone up in May? Given GTA healthy population growth and inflation, this little "bump" of your overpaying would soon become nothing in maybe as short as 5 years.

I have some anecdotes that might easily ease your anxiety.

My parents bought several apartments in Shanghai,China back in the early 90's for barely nothing, and sold them each for 300k CNY in early 2000 before a small market correction dipping, and I still could recall how "lucky" they felt before that dip,..... but 20 years later, if they would hold onto them for until now each apartment would be worth at least 10 mil CNY, which given 5 properties, in total will be worthing about 50 mil CNY for now(10 mil CAD equivalent), given how much CHY evaluated and how much CAD dipped for the past 20 years, each time I recalled the *selling*, my stomach probably developed an additional ulcer.... in a parallel universe I would probably be already living in a 10 mil mansion and no need to stand my boss's abusive attitude everyday.

sufi22 wrote: ↑ I bought a house at a premium price in Kitchener. I bought it at 970k 3 weeks back and comparable homes are getting sold at 890s and 925s. With Rate of interests bound to go up, rates will definitely fall back to 800s-850s level.

While I can momentarily allay or assuage myself of my apprehensions by saying that this is my first purchase, primary residence, etc. We are a young couple, have secured jobs and will be left with good amount in monthly savings after the mortgage too but the mere feeling that our house is going down in valuation and that too when there are 3 months left to close is keeping me awake at night. Already had put 35k. Can't sell it before closing. Few weeks back, I was so wishing for house prices to come down but now I don't want them to come down. Strange though but true. This is my first house and I am not all happy about my decision.

I wish I had never made that purchase.

Oh well....if you bought a few weeks ago, you only have yourself to blame then.
Got to learn to live with the results of your decisions.

OP, the best thing is to not dwell on it after the fact.

Live your life, move on. Posing questions that have no solutions has no upside.

Make a note of what you could've done different to not repeat this again in the future and get on with it.

Your primary residence purchase is a life style decision. Not a financial one. Enjoy!

Thanks. I hope it all makes sense couple of years down the road.