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Why I started this site… 400+ articles later

Facts Myths

I’m often asked why I started this site. It’s simple: I was tired of reading misinformation and twisted truths about mortgage brokering in Canada.

Back in 2009 when I created the site, there were some new blogs reporting on mortgage trends and offering ‘expert’ advice. (I use the term ‘expert’ loosely.) In reality, these sites were full of misinformation. The information was even damaging to the mortgage brokering landscape, in many cases… yet, they were being quoted by our largest newspapers and TV news channels. Wow! How can the major newspapers print this stuff?? It made me angry.

At the same time, there were rate shopping sites being launched. You know the ones… they compare bank, credit union and mortgage broker rates. These sites promised to compare rates, with no strings attached and tell you which provider has the lowest rate. They were supposed to be totally unbiased. They were supposed to be market neutral. Hey, don’t get me wrong, everyone loves to compare, shop and save, right? Comparing is part of being a smart consumer… but there is this huge problem… These sites are NOT unbiased or neutral. These sites are NOT run or owned by independent people.

You would expect a product review site to be neutral and unbiased, right? I mean, it just makes sense. If I want to compare hotels or vacation destinations, I’ll go to a site like TripAdvisor or Booking.com. We can clearly view the best available price and past customer experiences. We wouldn’t expect TripAdvisor or Booking.com to own the hotels or airlines they were advertising. That would be a conflict of interest.

Continue reading “Why I started this site… 400+ articles later”

Housing market is active but will slow in summer as it ALWAYS does..

Much has been written about the Canadian housing market.  Even more about greater Toronto and Vancouver.  The pessimists are waiting for a collapse.  The optimists are hoping the prices keep going up.  Then there’s the realists.  They would like to see the market slow and maybe even for prices to go down, so that we don’t have a housing bubble. Which one are you?

When it comes to the housing market, I’m a realist.

Every Spring, for the last 10+ years, the real estate market in Canada heats up.  Prices increase, they sell faster, and supply can’t keep up with demand. It’s become the norm.  In June, July and August, the market gets very quiet and prices go down.  That’s right, they actually go down.

This year was no different except for 2 things..  Supply was very low in January, February and March, causing selling prices to jump as much as 20% over last year in some markets.   Now, let’s look more closely.. Continue reading “Housing market is active but will slow in summer as it ALWAYS does..”

Housing bubble is coming… again?

You’ve seen them before.. but they went silent for a few years.  I’m talking about the housing bears.  The pessimists that say house prices are too high and will crash.  A housing bubble.

Are they right?  Maybe.  But here’s the thing.  We’ve been hearing that house prices are too high for over a decade.  One of the more vocal pessimists is David Madani, Economist for Capital Economics.

HOUSING BUBBLE?

Madani was on BNN this past week saying we are in a ‘Full blown housing bubble’.   Hmmm, that sounds familiar.  Let me think… when did I hear that before?  Oh, that’s right, 2011.   He said, we could see house prices drop by 25% in 2011.  And he was completely wrong. (hope you didn’t listen to him). Continue reading “Housing bubble is coming… again?”

Fall 2015 housing market remains hot!

$$ up arrowThe stats are in… House prices are up 6.1% in September compared with Sept 2014.  In fact, house prices were up across the country except Alberta, Saskatchewan and PEI.

Now, what’s the first thought that popped into your head?  Did you ask, ‘when will house prices collapse or go downs?’.   That’s probably what most of us are thinking.  The answer is, no one really knows.

The Canadian real estate market has proven to be as resilient as Justin Trudeau.   Our new PM took a lot of personal attacks but somehow, he managed to survive and win… a majority govt.  (not saying I want or don’t want him there… I’ll keep my personal politics private… for now anyways). Continue reading “Fall 2015 housing market remains hot!”

Average Toronto detached home sale is over $966k

$$ up arrow Recent housing stats released by Toronto Real Estate Board (TREB) show listings and sales are down but, prices are up.  According to TREB, the average sale price for a detached home in Toronto is $966,875.    For those that have invested in real estate, you’ve done well.  For those that are looking to buy, this may not be such good news.. However, there is a bright spot.

TREB also said that affordability has not deteriorated due to low mortgage rates.   No doubt that low rates are helping to fuel real estate price increases.   If you are waiting for the market to fall and prices to drop, you may want to reconsider that plan.   The forecast is for prices to remain strong.

It’s been an interesting year so far.  We’ve had a cold Spring, an even colder Winter, and yet the real estate market is red hot.   Watch for house sales to remain strong.   Trying to time the market can be costly.  Just ask those that sold 2, 3 and 4 years ago.   There have been many calls to exit the market.  I have personally seen some clients sell and rent for the last 2 and 3 years.  They are questioning that decision now.

I think buying a home should be a long term investment.  Plan to hold for 7 years.  That’s a long enough time to live through any up or down housing cycles.   If you can stick with that plan, then you should be okay.  Don’t buy because you are afraid of missing out.  Buy because you need a home and can afford it.  Buy because it’s a long-term investment and you have planned and thought it out.   Buying to invest is a good idea, you just need to understand what it takes to own and finance a property.

Speak with a team of professionals.  You need a good realtor, a lawyer, a mortgage broker, and an accountant.   Professional advice doesn’t mean it’s gonna cost you a lot of money either.   Professionals usually cost less than you think.. or they get compensated by other parties.. such as realtors and mortgage brokers.. you don’t pay them when you buy a house…  The get paid by the seller or the mortgage lender (unless you don’t qualify for a traditional mortgage).    The point is, it’s easier than you think.

Your best interest is my only interest.   I reply to all questions and I welcome your comments.  Like this article?  Share with a friend.

Steve Garganis 416 224 0114 steve@mortgagenow.ca

 

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