Tag Archives: mortgage monday

Housing Market Calming & Condo Buying Report

June 3, 2013

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Article courtesy of MCAP.

 

Market Calming, Not Crashing: BMO

Bank of Montreal economics published a Special Report last week on the Canadian housing market which seems to provide ample evidence that markets really are in the process of achieving the much sought after “soft landing” after federal policy makers took steps to cool the market last summer. The bank also predicts that the soft landing will likely continue. This analysis is obviously good news for the real estate and mortgage industries in Canada.

There is growing consensus that re-sale transaction volumes have stabilized at levels more in line with historical averages. This means that the drop of about 9% from volumes seen in the first half of 2012 is the new normal level and will likely continue on this pace, after the bite taken by the mortgage rule changes in July of last year. The not-so-good news then is that the pie is clearly smaller and will probably stay smaller for some time.

Housing starts have also adjusted to slowing demand and are now trending at a rate much closer to the rate of household formation – which was and always is inevitable. With a couple of well-known exceptions (like the Toronto condominium market), the bank suggests that, despite the rate of housing starts running well above household formation rates prior to the slowdown, there should be no “material overhang” from the run-up in supply. In certain segments, like the Toronto condo market, excess supply will ultimately bring downward pressure on prices.

Re-sale markets are characterized by the bank as “balanced” and not just in the usual sense of the sales-to-listings ratio being around 50% (which it is) but also with respect to prices and relative ongoing price stability. The Greater Toronto and Vancouver Areas, home to 25% of Canada’s population, may see some “moderate declines” in prices but other regions like Saskatchewan and Alberta should continue to see price appreciation. Overall, prices will be “steadier” this year – and steady prices and valuations are key characteristics of the soft landing seen so far.

 

BMO Condo Buying Report

As part of its Housing Confidence Report, BMO published survey data specific to condominiums last week. The data measures intentions among prospective buyers over the next five years in Canada’s four largest urban markets: Vancouver, Calgary, Toronto and Montreal. Looking first at Vancouver, the intention to buy a condo is down is down 5 points from a year ago to 28% among prospective buyers. The Calgary market reflects the current affordability challenges as condo buying intentions have risen 8 points to 33% while intentions to buy a traditional home have dropped sharply from 71% to 58%. In Toronto, condo buying intentions are up 11 points from last year to 31%. Montreal presents a different scenario where general home buying intentions are up 16 points to 62% but condo buying intentions have fallen by 3points, to 24%.

Demand for condos seems to be growing among baby boomers who might be looking to downsize, decrease home maintenance and increase their sense of security. Condo buying intentions are much higher among those over the age of 50 than they are for those under 50 (30% compared to 17%).

 

Tim

Tim is a mortgage agent in Barrie who specializes in helping first-time home buyers. He works with a variety of lenders and can help customize a mortgage with the best rates & options that fit the needs of each customer.

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Mortgage Monday Rate Update – April 2013

April 8, 2013

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First off, let me apologize for missing my Mortgage Monday blog posts from the past couple of weeks. I was on vacation back in Vancouver before the big spring mortgage rush hit, and decided to enjoy the beautiful spring weather they already had out there. 😉  Thanks for understanding.

For those that are shopping for a new house, or looking to do a refinance (or even just a simple mortgage renewal), rates and numbers are an important part of the mortgage equation. When rates change even the slightest of percentage points, it could cost or save you thousands of dollars. Every once in a while, here on the Mortgage Monday posts, I’ll update you on what’s going on in the world of mortgage rates. While the numbers haven’t changed that much, we haven’t done an update here on the blog for a couple of months…

 

  • The Bank of Canada interest rate continues to be stuck at 1.00%.  They meet again next week, but I don’t see this changing for a while yet.
  • The Bank of Canada prime lending rate is also holding steady at 3.00%. It has also been holding steady since Fall 2010 – if the bank rate goes up, the prime lending rate will follow.  We probably won’t see this start to move up well into 2013 or even 2014.
  • The qualifying rate (the rate you would need to qualify at for a variable mortgage) for a 5-year mortgage has actually dropped slightly to 5.14% from 5.24%. That being said, there are still not too many folks  getting into a variable mortgage these days with fixed rates continuing to be so low.
  • The current best variable rate (can change on a daily basis) is in the prime-0.40% (2.60%) ballpark, though many lenders are still currently offering ‘prime’ as their variable rate.
  • The current best 5-year fixed mortgage rate (changes daily) has moved slightly lower over the past couple of months and sits in the 2.79%-2.99% range, depending on qualifications and options.  Again, always contact your mortgage broker for current best rates for your situation (and as we’ve talked about previously, The Best Mortgage Rate is Not Always the Best Option).  Be careful when looking at some of the heavily discounted rates – many of them are considered “no-frills” mortgages and can come with restrictive options which could end up costing you thousands.
  • While the “hot term” in Canada these days may still continue to be the full-featured, 10-year fixed mortgage with rates as low as 3.69% (check out my posts from last year on the 10-Year Mortgage Below 4% and Should You Consider a 10-Year Mortgage?), the 5-year term is remaining the “go-to” term in Canada – especially with 5-year rates as low as 2.79%. Based on the history of lending rates, locking in for 10 years at below 4%, or 5 years for less than 3% is nothing short of fantastic.

While I’m happy to provide an update on what’s going on as rates, if you’re interested on getting personalized mortgage advice, speak to your favorite mortgage broker who can help you decide the best rates and options for you.

Tim

Tim is a mortgage agent in Barrie who specializes in helping first-time home buyers. He works with a variety of lenders and can help customize a mortgage with the best rates & options that fit the needs of each customer.

More Posts - Website

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Mortgage Monday Rate Update – February 2013

February 11, 2013

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For those that are shopping for a new house, or looking to do a refinance (or even just a simple mortgage renewal), rates and numbers are an important part of the mortgage equation. When rates change even the slightest of percentage points, it could cost or save you thousands of dollars. Every once in a while, here on the Mortgage Monday posts, I’ll update you on what’s going on in the world of mortgage rates. If this kind of stuff doesn’t really interest you, I won’t be offended if you just skim through it – I’ll try to make it as painless as possible. 😉

  • The Bank of Canada interest rate continues to be stuck at 1.00%.  The next meeting is scheduled for March 6th, 2013, but forecasters are now predicting this will stay at 1% for the foreseeable future.
  • The Bank of Canada prime lending rate is also holding steady at 3.00%. It has also been holding steady since Fall 2010 – if the bank rate goes up, the prime lending rate will follow.  We probably won’t see this start to move up well into 2013 or even 2014.
  • The qualifying rate (the rate you would need to qualify at for a variable mortgage) for a 5-year mortgage is still at 5.24% (its been holding steady there since June 2012), though ot many folks are getting into a variable mortgage these days with fixed rates being so low.
  • The current best variable rate (can change on a daily basis) is in the prime-0.35% (2.65%) ballpark, though many lenders are still currently offering ‘prime’ as their variable rate.
  • The current best 5-year fixed mortgage rate (changes daily) hasn’t really moved around much and is still in the area of 2.99%-3.09%, though it looks like rates are starting to move a little higher.  Again, always contact your mortgage broker for current best rates for your situation (and as we’ve talked about previously, The Best Mortgage Rate is Not Always the Best Option).  Be careful when looking at some of the heavily discounted rates – many of them are considered “no-frills” mortgages and can come with restrictive options which could end up costing you $1,000’s.
  • The “hot term” in Canada these days continues to be full-featured, 10-year fixed mortgage with rates as low as 3.79% (check out my posts from last year on the 10-Year Mortgage Below 4% and Should You Consider a 10-Year Mortgage?). If you want to lock in for a decade and record-low rates, definitely take a look at locking in for 10 years at less than 4%.  I had more clients moving into 10-year terms than any other term in the last quater of 2012.

If you’ve been following along with my rate updates, they have been very repetitive for the past 6-8 months – very few of the numbers have changed since mid-2012. While I’m happy to provide an update on what’s going on as rates, if you’re interested on getting personalized mortgage advice, speak to your favorite mortgage broker who can help you decide the best rates and options for you.

Tim

Tim is a mortgage agent in Barrie who specializes in helping first-time home buyers. He works with a variety of lenders and can help customize a mortgage with the best rates & options that fit the needs of each customer.

More Posts - Website

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Mortgage Monday Rate Update: December 2012

December 10, 2012

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While the mortgage industry slows down around Christmas, it doesn’t quite slow to a standstill.  For those that are shopping for a new house, or looking to do a refinance (or even just a simple mortgage renewal), rates and numbers are an important part of the mortgage equation. When rates change even the slightest of percentage points, it could cost or save you thousands of dollars. Every once in a while, here on the Mortgage Monday posts, I’ll update you on what’s going on in the world of mortgage rates. If this kind of stuff doesn’t really interest you, I won’t be offended if you just skim through it – I’ll try to make it as painless as possible. 😉

  • The Bank of Canada interest rate continues to hang out at 1.00%.  The next meeting is scheduled for January 23rd, 2013.
  • The Bank of Canada prime lending rate is also holding steady at 3.00%. It has also been holding steady since Fall 2010 – if the bank rate goes up, the prime lending rate will follow.  We probably won’t see this start to move up well into 2013 or even later.
  • The qualifying rate (the rate you would need to qualify at for a variable mortgage) for a 5-year mortgage is still at 5.24%.  Not many folks are getting into a variable mortgage these days (though we’re starting to see some better rates in the variable department now).
  • The current best variable rate (changes daily) is in the prime-0.35% (2.65%) ballpark, though many lenders are still currently offering ‘prime’ as their variable rate.
  • The current best 5-year fixed mortgage rate (changes daily) hasn’t really moved around much and is still in the area of 2.99%-3.09% – again, always contact your mortgage broker for current best rates for your situation (and as we’ve talked about previously, The Best Mortgage Rate is Not Always the Best Option).  Be careful when looking at some of the heavily discounted rates – many of them are considered “no-frills” mortgages and can come with restrictive options which could end up costing you $1,000’s.
  • The “hot term” in Canada these days is still the full-featured, 10-year fixed mortgage with rates as low as 3.89% (check out my post from a couple of months ago on the 10-Year Mortgage Below 4% and a more recent one: Should You Consider a 10-Year Mortgage?). If you want to lock in for a decade and record-low rates, definitely take a look at locking in for 10 years at less than 4%.  I have more clients moving into 10-year terms than any other term this month.

If you’ve been following along with my rate updates, they are probably starting to sound pretty repetative.  Very few of the numbers have changed for the past several months. While I’m happy to provide an update on what’s going on as rates, if you’re interested on getting personalized mortgage advice, speak to your favorite mortgage broker who can help you decide the best rates and options for you.

Tim

Tim is a mortgage agent in Barrie who specializes in helping first-time home buyers. He works with a variety of lenders and can help customize a mortgage with the best rates & options that fit the needs of each customer.

More Posts - Website

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Mortgage Monday Rate Update

November 12, 2012

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Yup, it’s time for another monthly rate update.  Whether you like it or not, stats and numbers are a part of the world of mortgages. When rates change even the slightest of percentage points, it could cost or save you thousands of dollars. Every once in a while, here on the Mortgage Monday posts, I’ll update you on what’s going on in the world of mortgage rates. If this kind of stuff doesn’t really interest you, I won’t be offended if you just skim through it – I’ll try to make it as painless as possible. 😉

  • The Bank of Canada interest rate continues to hang out at 1.00%.  The next meeting is scheduled for December 4th, 2012.
  • The Bank of Canada prime lending rate is also holding steady at 3.00%. It has also been holding steady since Fall 2010 – if the bank rate goes up, the prime lending rate will follow.  We probably won’t see this start to move up well into 2013.
  • The qualifying rate (the rate you would need to qualify at for a variable mortgage) for a 5-year mortgage is still at 5.24%.  Not many folks are getting into a variable mortgage these days (though we’re starting to see some better rates in the variable department now).
  • The current best variable rate (changes daily) is in the prime-0.35% (2.65%) ballpark, though many lenders are still currently offering ‘prime’ as their variable rate.
  • The current best 5-year fixed mortgage rate (changes daily) hasn’t really moved around much and is still in the area of 2.99%-3.09% – again, always contact your mortgage broker for current best rates for your situation (and as we’ve talked about previously, The Best Mortgage Rate is Not Always the Best Option).  Be careful when looking at some of the heavily discounted rates – many of them are considered “no-frills” mortgages and can come with restrictive options which could end up costing you $1,000’s.
  • The “hot term” in Canada these days is still the full-featured, 10-year fixed mortgage with rates as low as 3.99% (check out my post from a couple of months ago on the 10-Year Mortgage Below 4% and a more recent one: Should You Consider a 10-Year Mortgage?). If you want to lock in for a decade and record-low rates, definitely take a look at locking in for 10 years at less than 4%.

If you’ve been following along with my rate updates, they are probably starting to sound pretty repetative.  None of the numbers have changed from last month (again). While I’m happy to provide an update on what’s going on as rates, if you’re interested on getting personalized mortgage advice, speak to your favorite mortgage broker who can help you decide the best rates and options for you.

Tim

Tim is a mortgage agent in Barrie who specializes in helping first-time home buyers. He works with a variety of lenders and can help customize a mortgage with the best rates & options that fit the needs of each customer.

More Posts - Website

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