Category Archives: Real Estate Advice

Consumer Debt Impacts IMF’s Outlook for Canada

Canada’s economic outlook took a big hit this morning as the International Monetary Fund downgraded the nation’s financial outlook. Inflated consumer debt levels and a shaky housing market were at the heart of the downgrade, which was announced in Tokyo this morning at the IMF-World Bank annual meeting.

The Washington-based global lender’s quarterly World Economic Outlook downgraded Canada’s economic advance from 2.1 percent to 1.9 percent for 2012. Next year’s growth was also altered from 2.2 percent to 2.0 percent. Currently, the Bank of Canada has estimated growth of 2.1 percent for this year and 2.3 percent for 2013. The central bank doesn’t issue it’s next forecast until October 24 when the Monetary Policy Report is released. Continue reading →

What if the Government Didn’t Back Mortgages?

Saving for a down payment on a home takes dedication, perseverance, and sacrifice. For many, it also takes a long, long time. According to a recent report from Rate Supermarket, come 2020 the average cost of a home in Canada will be $553,000. To accumulate a measly 5 percent down payment for such a home, recent graduates should expect to spend at least 12 years saving up. If you’re hoping to pack away 10 percent, prepare to squirrel away your savings for roughly 21 years.  Continue reading →

Make the Right Investment in Your Home

Has owning your home become the new retirement savings plan? According to recent statistics, more and more Canadians are investing in their home rather than their RRSP. While half of Canadians haven’t contributed to their registered retirement savings plan, close to 70 percent of households currently own their own home.

It’s an interesting shift, and one that could prove extremely beneficial to budget-savvy individuals. Jason Heath, a certified-financial planner with Objective Financial Partners Inc. explained the rationale in a recent Financial Post interview, stating that “your money grows tax free” in your property, whereas RRSP savings feature fully-taxable withdrawals. Continue reading →

Questions to Help You Avoid Mortgage Penalties

Thinking about opting out of your fixed rate mortgage in order to take advantage of ultra low variable rates? Be careful! Interest rate differential (IRD) charges – commonly referred to as mortgage penalties – could leave a large dent in your wallet if you’re not careful.

Unfortunately, banks have historically made it nearly impossible to figure out just how expensive switching mortgages is. But that’s about the change. A new “voluntary” Code of Conduct has been implemented by the Department of Finance whereby banks are now required to provide their mortgage customers with clearer explanations of prepayment charge calculations, as well as provide calculators so that mortgage holders can estimate their own penalty estimates. Mortgage calculators can now be found on the official websites of the Bank of Montreal, CIBC, HSBC, ING Direct, Laurentian Bank, National Bank of Canada, Manulife Bank, Royal Bank, Scotiabank and TD Canada Trust. Continue reading →

What To Do When Housing Prices Fall

It appears as though the seemingly infinite rise of Canadian housing prices has finally come to an end. After years of marvelling at record breaking list prices and historically low mortgage rates, the tides have finally shifted. Phrases like “cooling market” and “slow sales” are gracing national headlines, causing buyers and sellers alike to contemplate the repercussions.

If we’re to believe what the experts are saying, real estate in Canada has hit a tipping point. According to the Canadian Real Estate Association, sales are down a staggering 30 percent compared to last years numbers. What’s more, the average house price has dropped by roughly 3.5 percent since July.  Continue reading →