All About Real Estate, Finance & Mortgages

It’s that time of year again, when we vow to kick bad habits and set a healthier or more positive course for the new year ahead. Improving our finances usually tops the list, and this year is no exception. For the 10th straight year, the top financial priority for Canadians in 2020 is to pay off their debts — perhaps not surprising given that the average person dropped about $1,600 on holiday shopping last month. Read more...

#StratfordMortgageBroker

#StratfordMortgageBroker

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OTTAWA – Canada’s first-time home buyers may have to shelve their dream house fantasies due to lending changes announced this week by the federal government, mortgage brokers say. Ottawa moved this week to tighten mortgage lending rules that will limit the amount many Canadians can borrow to help ensure that when interest rates rise, they’ll still be able to make their payments. Mortgage broker Frank Napolitano says that means the size of mortgage many buyers will be able to qualify for will be less once the rules take effect on Oct. 17. “First-time homebuyers will probably have to probably scale down the type of home that they may have planned to buy,” said Napolitano, managing partner at Mortgage Brokers Ottawa. Under the new rules, a stress test that had only applied to borrowers who opted for variable rate mortgages or fixed rate mortgages with terms less than five years will now be used for all home buyers with less than a 20 per cent down payment. That means borrow

Finance minister Charles Sousa is giving first-time home buyers a $4,000 land transfer tax rebate.

I've seen it too many times. Young people come into my office looking for a mortgage. Through hard work and discipline they have saved between $50,000 and $100,000 for a down payment and I cannot give them a mortgage. Why? Because they have no credit score. It's not that they have poor credit, it's that they don't have any at all. They thought they were doing all the right things (and they were). They lived within their means, only bought items (even cars) when they had the money and don't owe anyone anything. But it's time to purchase their first home and the banks won't give them money.  Click here for entire article

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The government brochure announcing the introduction of the TFSA calls it “the single most important personal savings vehicle since the introduction of the Registered Retirement Savings Plan (RRSP)”. Unlike the usual hyperbole, the government is probably understating the importance that TFSAs are likely to play in the savings plans of all Canadians. Read more...

OTTAWA, November 5, 2012 — Canada’s new home market is expected to continue to moderate in the last quarter of 2012 and into 2013. Meanwhile, activity in the existing home market is expected to hold steady, leading to house price growth in line with or slightly below inflation, according to Canada Mortgage and Housing Corporation’s (CMHC) fourth quarter 2012 Housing Market Outlook, Canada Edition. “A weaker outlook for global economic conditions and the waning of the effect of pre-sales from late 2010 and early 2011, which contributed to support multi-family starts this year, will bring moderation in housing starts next year. Nevertheless, employment growth and net migration will help support housing starts activity going forward,” said Mathieu Laberge, Deputy Chief Economist for CMHC. On an annual basis, housing starts will be in the range of 210,800 to 216,600 units in 2012, with a point forecast of 213,700 units. In 2013, housing starts will be in the range of 177,300 to 209,900

“...The changes to mortgage insurance criteria are unnecessarily jeopardizing the health of Canada’s housing markets and the broader economy.” That’s the conclusion from economist Will Dunning in CAAMP’s just-released State of the Residential Mortgage Market report. (Link) Dunning says his research suggests the Finance Department has created “a policy-induced housing market downturn” that could reinforce existing weakness. He calculates that the most recent (July 2012) rule changes will knock 11% of potential high-ratio homebuyers out of the market—that is, until they can come up with more net income or a bigger down payment. He lays out the following arguments: Jobs underpin the market… “Job creation is the key driver of housing demand” writes Dunning. “The ‘housing wealth’ effect (the increased confidence, and willingness to spend and invest, that results from rising house prices) is the single most important driver of job creation” What’s more, in the p

TARA PERKINS - REAL ESTATE REPORTER The Globe and Mail Published Monday, Nov. 19 2012, 6:30 AM EST Canada’s financial regulator will release new guidelines for mortgage insurers early next year, including the government’s Canada Mortgage and Housing Corp. – but they won’t drag down the housing market as much as the guidelines for banks have, says the country’s banking watchdog. The Office of the Superintendent of Financial Institutions will outline what standards it expects the country’s three mortgage insurers to follow when they underwrite a policy on a home. Ottawa has just recently given OSFI the job of overseeing CMHC, a federal Crown corporation that is the largest player in the industry; it was already regulating two private-sector rivals, Genworth MI Canada and Canada Guaranty. The mortgage guidelines that OSFI released for banks this summer are believed to have played a role in the decline in national home sales for the second half of this year. The new rules push

By Gail Johnson Read Here Kelly Gardiner In his three decades as a real-estate agent in North Vancouver, B.C., Kelly Gardiner  has seen a lot of different reactions from people buying a house for the first time . Usually, they're excited, nervous and overwhelmed. But there's another feeling that sometimes pops up -- utter shock -- not from the purchase itself, but because of all the associated costs people never even thought of. "For people who haven't moved that often, a lot of expenses can come as a surprise (money mistakes)," Gardiner says. "Or they're so focused on just signing the papers that they never stop to think about everything that's involved in owning a home and moving into one." So, if owning property is a new endeavour, here are some of the hidden costs to budget for before you close the deal: Legal fees Fees and disbursements usually cost around $1,000. You can hire a lawyer or a notary, but it's best to deal wit

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I feel compelled to give my thoughts on a highly-publicized CIBC report out last week titled, “Should we worry about a US-style housing meltdown?”, written by Ben Tal. The full report can be read here.

Where housing prices are rising the most

Government of Canada Takes Action to Strengthen Housing Financing : The Honourable Jim Flaherty, Minister of Finance, today announced a number of measured steps to support the long-term stability of Canada's housing market and continue to encourage home ownership for Canadians. 'Canada's housing market is healthy, stable and supported by our country's solid economic fundamentals,' said Minister Flaherty. 'However, a key lesson of the global financial crisis is that early policy action can help prevent negative trends from developing.' The Government will therefore adjust the rules for government-backed insured mortgages as follows: Require that all borrowers meet the standards for a five-year fixed rate mortgage even if they choose a mortgage with a lower interest rate and shorter term. This initiative will help Canadians prepare for higher interest rates in the future. Lower the maximum amount Canadians can withdraw in refinancing their mortgages to 90 per

There will be lots of information coming out today. Bank of Canada governor Mark Carney will be explaining (maybe vaguely) the reasons for the BoC rate drop and expectations we should have for the future, quantitative easing (printing money), and how this will all affect the Canadian economy. Here is an article from the Financial Post that expands on this. Keep an eye on this as it will affect bond rates/yields which could affect mortgage rates. Terence Corcoran: Quantitative schemes at the Bank of Canada Posted: April 22, 2009, 9:17 PM by Ron Nurwisah Terence Corcoran , central banks On Thursday we will learn what the Bank of Canada will do next to stimulate the economy, how it will apply the now famous “quantitative easing” phase of its ongoing effort.The bank is already giving away money, setting an overnight rate of 0.25% — “virtually zero,” as former governor John Crow says in his commentary . At the chartered banks, astute mortgage borrowers can almost lock in less than 2% for

• 100% financing (5% will now be the minimum down payment on an insured mortgage) • 40 year amortizations (35 years will be the new maximum on insured mortgages) The government will also require the following with all new mortgages it insures: • A new 620 minimum credit score requirement • New loan documentation standards The new rules will take effect October 15, 2008. This affects CMHC insured mortgages as well as mortgages insured by Genworth, AIG, etc. Insured mortgages are generally those with less than 20% down. Certain conventional mortgages are also insured, however, in a statement from the Department of Finance said, "Today’s announcement marks a responsible and measured approach by the Government to ensure Canada’s housing market remains strong and to reduce the risk of a U.S.-style housing bubble developing in Canada. "These new rules pertain only to new, government-backed insured mortgages. This will not affect existing mortgages."

Housing starts were up for January to a seasonally adjusted annual rate of 222,700 units, compared to 184,700 units in December, according to Canada Mortgage and Housing Corporation figures released Friday. A seasonally adjusted annual rate measures monthly figures adjusted to remove normal seasonal variation and multiplied by 12 to reflect annual levels. "Historically low mortgage rates, solid employment and income growth as well as a high level of consumer confidence continue to underpin the high level of housing starts," chief economist Bob Dugan said in a news release. "Housing starts in January returned to a level more consistent with our expectation that housing starts will total 211,700 units in 2008, remaining above the 200,000 mark for the seventh consecutive year." Continue Article