Tag Archives: mortgage market

S&P Ratings Questionable

S&P has made questionable ratings over the past few years, putting into doubt their value and purpose.  A recent downgrade of Canada’s big banks is the most recent example of how out of touch they can be with their ratings system.  It’s 2011 downgrade of the US government was farcical at best and interpreted by many as more of a political statement than a risk rating. It seems that the … Read More

Posted in Blog, Government Policy, Personal Finance | Tagged , , | Leave a comment

Are Non-Bank Mortgages Safe?

There are dozens of mortgage companies across the Country providing consumers with a broad array of choices.  Although there are only a small number of banks, they dominate the market due to their strong brand names and their vast branch networks.  But that doesn’t mean they’re better. Non-bank mortgage lenders offer mortgages with similar and sometimes better pre-payment privileges, features and benefits.  More importantly they often offer lower mortgage rates.  … Read More

Posted in Blog, Canadian Housing Market, Personal Finance | Tagged , , , , | 1 Comment

Mortgage Rules Affect All Purchase Price Levels

The most recent round of mortgage rule tightening reduced maximum amortizations to 25 years.  This effectively increased the minimum mortgage payments required by home purchasers.  “The rule changes are affecting the entire housing market – high end, low end, mid-range,” echoed Sal Guatieri, Bank of Montreal senior economist. This is no more evident than in the Vancouver housing market.  Residential property transactions are down 33% to 1,516 units in September … Read More

Posted in Blog, Canadian Housing Market, Government Policy | Tagged , , | Leave a comment

CREA Cuts Forecasts

The Canadian Real Estate Association (CREA) cut its home sales forecasts for 2012 and 2013 and lowered its national average price predictions in a report issued earlier today. The new forecast eliminates 8,900 transactions from the previous 2012 forecast, but still calls for growth of 1.9% over 2011.  Of bigger concern is the 1.9% reduction in transactions forecast for 2013 bringing us back two years to the 2011 activity of … Read More

Posted in Blog, Canadian Housing Market, Government Policy | Tagged , , , , | Leave a comment

CMHC on Track to Profit another Billion

CMHC released its second quarter results on Wednesday reporting a quarterly profit of $255 million.  The crown corporation is well on its way to generating another $1 billion in annual profits.  The Canadian government doesn’t usually do well running profitable businesses, but this is one cash cow that we’d be foolish to privatize. Mortgage insurance claims for the quarter were $168 million, up from $144 million in the same period … Read More

Posted in Blog, Canadian Housing Market, Government Policy | Tagged , , | 1 Comment

Scotiabank Buys ING Direct

After a short time on the auction block ING Direct has been gobbled up by Scotiabank for a reported $3.1 Billion.  It’s the largest transaction in Scotiabank’s 180 year history.  Although many of Canada’s big banks were interested in the transaction, Scotiabank was the hungriest to acquire its $30 billion of deposits.  On the heels of the announcement Scotiabank published a high profile letter reassuring ING Direct customers that it … Read More

Posted in Blog, Canadian Housing Market, Mortgage Rates | Tagged , | 2 Comments

15 Years to Mortgage Freedom

On average Canadians have 15 years left to pay off their mortgage.  This is the findings of a survey released yesterday, conducted by Leger Marketing, for BMO Bank of Montreal.  It’s difficult to distil any meaning from an average of the entire Canadian population, but thankfully the survey breaks down its findings by province and by 5 year amortization increments.  Here are a summary of the results. Years Left on                                                   … Read More

Posted in Blog, Canadian Housing Market, Government Policy | Tagged , , , , | Leave a comment

Beat the Mortgage Tightening Deadline

One week ago, the department of finance announced its latest round of mortgage rule tightening.  The four rule changes are as follows: Reduce the maximum amortization to 25 years from 30 years. Lower the maximum amount Canadians can borrow when refinancing to 80% from 85% of the value of their homes. Reduce the maximum gross debt service ratio to 39% from 44% Limit the availability of government-backed insured mortgages to … Read More

Posted in Blog, Government Policy | Tagged , , , , | Leave a comment

CMHC Back to Basics

The latest round of mortgage rule tightening brings Canada Mortgage and Housing Corporation’s (CMHC’s) mortgage rules back in line with its original mandate.  Helping Canadians buy their first home.  CMHC was established in 1946 as a government-owned corporation to address Canada’s post-war housing shortage.  Over the years scope creep entered the picture and the government insurer began meeting market needs by allowing borrowers to refinance their homes to 95% of … Read More

Posted in Blog, Government Policy | Tagged , , , , | Leave a comment

Mortgage Rates Not Going Anywhere

The federal government along with the Canadian Central Bank is growing increasingly concerned with our low interest rate environment.  Traditional thinking stipulates that these low rates are un-natural and in time, when the global economy rights itself, interest rates will rise to 6%-7% back to their natural norm.  This is a reasonable expectation although as time goes on the strongest argument in favor of the 6.5% natural interest rate theory … Read More

Posted in Blog, Government Policy, Mortgage Rates | Tagged , , , | 2 Comments