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Looking ahead to 2015 rates and trends

happyholidays (1) Seasons Greetings!  Happy New Year!   Quick thank you for making 2014 a great year!  Hope yours was just as special.  And I’m wishing you much success and happiness in 2015.

I’ll make this quick as I’m sure you have some New Year’s Eve celebrations to attend to.

QUICK YEAR IN REVIEW.

  • Interest rates haven’t really changed this year.
  • 5 yr fixed rates are under 3.00%.
  • Variable rate pricing improved to around Prime less 0.60% (less in some cases and dropping).
  •   In fact, looking at the big picture, interest rates haven’t really changed much in the last 4 yrs.   Yet, you wouldn’t know it by reading the newspaper headlines….(sorry to my media friends…)

Let’s get to it.  MY THOUGHTS ON 2015. Continue reading “Looking ahead to 2015 rates and trends”

Posted 2 Comments on Housing bubble? Waiting for the crash before buying has cost you 602 in the last 6 years. Case study

Housing bubble? Waiting for the crash before buying has cost you 60% in the last 6 years.

Housing BubleBad news travels 10 times faster than good news!  It’s just human nature that we can’t seem to escape.  We seem more likely to gossip about someone’s misfortune than their accomplishments.

Here’s a negative headline….  YOU LOST APPROXIMATELY $355,000, SO FAR, IF YOU’VE BEEN WAITING TO A BUY HOUSE SINCE 2008.  Read on to see understand how and why.

Take Wednesday’s headline in the Financial Post, “Bank of Canada warns house prices are overvalued by up to 30%” .  WOW!  How’s that not gonna get your attention?   It certainly got mine.  I immediately had to read this article.  But the more I read, the clearer it became that this statement wasn’t exactly true.

The article pointed to a semi-annual report that is put out by the Bank of Canada entitled, Financial System Review December 2014.  That headline is an attention grabber.. And like most media headlines, it’s not the full story.  In fact, it’s not an accurate reflection of what the Bank of Canada report had to say.   If you look at Stephen Poloz’s (Bank of Canada Governor) comments, he says “there is some risk that the housing market is overvalued, and our estimates fall in the 10 to 30 per cent range”.

But he’s not done there.. Continue reading “Housing bubble? Waiting for the crash before buying has cost you 60% in the last 6 years.”

Posted Case study

Attn: Ontario landlords… Rent control rules may not apply!

landlord-tenantDid you know that Alberta has no residential rent control?   And British Columbia landlords can increase rents by the rate of inflation PLUS 2%?   In Ontario, the Landlord and Tenant Board sets annual rent increases.   For 2014, the rent increase was a mere 0.8% and for 2015 the rents can only be increased by 1.6%.  Anyone that’s bought a rental property has probably been following these rules for years.   An increase of 2.2% over a 2 year period sounds great if you are a tenant, but somewhat unfair if you are landlord.

Now, what if I told you there’s a good chance your PROPERTY IS EXEMPT FROM ONTARIO’S RENT CONTROL RULES?  Meaning you can increase the rents as high as you like.   According to the Ontario Landlords Association, more and more properties are becoming exempt from Ontario’s rent control rules.  
Continue reading “Attn: Ontario landlords… Rent control rules may not apply!”

Posted 8 Comments on When this guy can’t qualify for a mortgage, you know the mortgage rules are too tight! Consumer Debt

When this guy can’t qualify for a mortgage, you know the mortgage rules are too tight!

BernankeFORMER US FED CHAIRMAN CAN’T GET A MORTGAGE.

Anyone remember this guy?  Ben Bernanke.   He’s just the former Chairman of the US Federal Reserve Bank. He served two terms from 2006 to 2014.   Earlier this month, he revealed that he was declined for a mortgage refinance.  Now, just to put this in perspective, he used to make a nice 6 figure salary.  And today, he is paid an estimated $250,000 per speaking engagement.

How can he not qualify?  Clearly, the mortgage rules tightening process has gone waaaaaay overboard.   But this isn’t just happening in the US.   Canada’s mortgage lending rules have always been tighter than the US.  And over the past 6 years, the Canadian govt has brought in numerous changes to tighten the rules even further.  (Actually, experts agree that they went way overboard.  And we are only now seeing the effects of the rule changes.. Look out.  You’re in for a big surprise the next time you need mortgage money).

CANADIAN MORTGAGE RULES ARE EVEN TIGHTER!!

Canada’s Banking industry has been the envy of the world.  We came out of the 2008 US sub-prime mortgage crisis with no visible scars.   Continue reading “When this guy can’t qualify for a mortgage, you know the mortgage rules are too tight!”

Posted 1 Comment on Bi-weekly payment myth…. it won’t pay your mortgage off faster. Mortgage News

Bi-weekly payment myth…. it won’t pay your mortgage off faster.

No Mortgage Bi-weekly payments won’t pay your mortgage off faster.  Yup, it’s true.  Around 4 yrs ago, I wrote an article showing some simple but effective math to explain this.  Recently, I’ve had several readers and clients ask me about bi-weekly payments.

I thought I’d repost that article as it seemed to get a lot of attention and answered a great many questions on what it really takes to pay your mortgage off faster.

Repost from July 2010….

Back in the mid 90’s, there was a huge marketing blitz by the Big Banks that promoted making bi-weekly payments instead of the traditional monthly payments.   The sales pitch was that you could save huge amounts of money and pay your mortgage off much faster….save 4 or 5 years off your amortization…. Sound familiar?   Well, BI-WEEKLY PAYMENTS DON’T REALLY SAVE AS MUCH AS YOU THINK!

And I’ll prove it…. here’s the straight facts! Continue reading “Bi-weekly payment myth…. it won’t pay your mortgage off faster.”