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CMHC Makes It Harder To Qualify For An Insured Mortgage

Once again, the Canadian Mortgage and Housing Corporation (CMHC) is tightening the criteria to get a mortgage with less than a 20% down payment. Any potential home buyer with less than a 20% down payment must purchase default insurance on their loan and have a minimum down payment of 5%. CMHC is a federal Crown Corporation that provides such default insurance. Its mandate is to help Canadians access affordable housing options. Providing mortgage insurance to home buyers is one of its main activities. Mortgage default insurance protects lenders in the event a borrower ever stopped making payments and defaulted on their mortgage loan–a very infrequent occurrence in Canada. There are private providers of default insurance as well–Genworth Financial Canada and Canada Guaranty. CMHC is the only insurer of mortgages for multi-unit residential properties, including large rental buildings, student housing and nursing and retirement homes. It is the largest provider of mortgage default insurance by far …
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Canada Emergency Commercial Rent Assistance (CECRA)

Federal Government Update Today, the Prime Minister announced that the federal government has reached an agreement in principle with all provinces and territories to implement the Canada Emergency Commercial Rent Assistance (CECRA) for small businesses. This program will lower rent by 75 per cent for small businesses that have been affected by COVID-19. The details that have been announced at this point are below. We will share more details about the CECRA as they become available. The CECRA program will provide forgivable loans to qualifying commercial property owners to cover 50 per cent of three monthly rent payments that are payable by eligible small business tenants who are experiencing financial hardship during April, May, and June. The loans will be forgiven if the mortgaged property owner agrees to reduce the eligible small business tenants’ rent by at least 75 per cent for the three corresponding months under a rent forgiveness agreement, which will …
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5 Steps to Start Investing in Real Estate

From the desk of Matthew Shantz: When looking to start investing in Real Estate it is very easy to get caught up in the excitement. We read books, listen to podcasts, take courses, talk to friends, go to open houses, speak with realtors and spend hours browsing through MLS and listings. We ask everyone “how did you do it?” or “what are you investing in?” or worst still “how much money did you make?”. I get it, I have been there. We just want to do something, anything, because not doing something feels like we are wasting our time, missing out on the next big opportunity and have let another chance to ‘get rich’ slip through our fingers. Over the past 15 years I have attended more seminars, read more books, listened to more speakers, interviewed more experts and walked through more houses then I could count. I figured that …
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Home Sales Slip A Bit In January As Supply Tightens Pushing Up Prices

  Statistics released today by the Canadian Real Estate Association (CREA) show that national existing-home sales dipped between December and January owing to a dearth of new listings, especially in the GTA. As the CREA chart below shows, the pace of monthly home resales nevertheless remained strong.  Home sales recorded over Canadian MLS® Systems declined by 2.9% in January 2020, although they remain among the stronger monthly readings of the last few years.  Transactions were down in a little over half of all local markets in January, with the national result most impacted by a slowdown of more than 18% in the Lower Mainland of British Columbia. According to CREA, “While there were few notable gains in January, it should be noted that many of the weaker results have come alongside a shortage of new supply in markets where inventories are already very tight.” Actual (not seasonally adjusted) sales activity was …
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Canadian 5-year Yield Fell To Lowest Level Since October

Global investors are selling stocks and piling into the safety of bonds in response to fears that the Wuhan coronavirus could disrupt global economic activity. Gold prices, another haven, have also risen. The Government of Canada 5-year bond yield traded this morning at roughly 1.35%, well below its nearly 1.70% level one month ago. The 5-year yield leads fixed mortgage rates, so if this trend persists, we might see widely available fixed-5-year rates in the 2.50% range once again in February.    ____________________________________________ Bank of Canada Now Buying 10-year CMBs   The Bank of Canada announced yesterday that effective immediately, the Bank will expand the Canada Mortgage-Backed securities (CMBs, which are government-guaranteed) it can purchase in the primary market to include 10-year fixed-rate bond issues. In 2018, The Bank expanded the assets it acquires to 5-year fixed and floating CMBs. The Bank held $517 million of these 5-year CMBs as of …
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Weak New Listings Slow Canadian Home Sales as Prices Continue to Rise

Sellers Housing Market  Now in the Greater Toronto Area (GTA) Statistics released today by the Canadian Real Estate Association (CREA) show that national existing-home sales dipped between November and December owing to a dearth of new listings, especially in the GTA. National home sales edged down 0.9% in the final month of 2019, ending a streak of monthly gains that began last March. Activity is now about 18% above the six-year low reached in February 2019 but ends the year about 7% below the peak recorded in 2016 and 2017 (see chart below). There was an almost even split between the number of local markets where activity rose and those where it declined, with higher sales in the Lower Mainland of British Columbia, Calgary and Montreal offsetting declines in the Greater Toronto Area (GTA) and Ottawa. Actual (not seasonally adjusted) activity was up 22.7% compared to the quiet month of …
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Bank of Canada Interest Rate as of December 2019

The Bank of Canada is maintaining the interest rate at 1.75% as of December 2019. The bank has confirmed that there are ongoing trade conflicts and uncertainty are preventing business investment, trade, and global growth in Canada. 🇨🇦🗞️ The global economy is stabilizing and economic growth is expected to increase over the next couple of years. The next interest rate announcement is January 22nd.. Stay Tuned! 👀🗞️ . To learn more about the Bank of Canada’s decision visit https://bit.ly/2DN7WPo The scheduled dates for the interest rate announcements for 2020 are as follows: Wednesday, January 22 Wednesday, March 4 Wednesday, April 15 Wednesday, June 3 Wednesday, July 15 Wednesday, September 9 Wednesday, October 28 Wednesday, December 9

May Market Report

In this month’s market report, Tracy looks at the May real estate market with guest Realtor, Caroline Harvey from Royal LePage Wolle, right here in Kitchener. Caroline works closely with her husband, Mike, and TEAM HARVEY is consistently one of the top-producing teams with Royal LePage, and you can check out their current listings, or contact them here.

Bank of Canada Rate Change: Here’s what you need to know

As a home owner, or someone who is looking at purchasing a home, you’re probably wondering what today’s announcement from the Bank of Canada really means.  Today, for the first time in 7 years, the key interest rate was increased by a 1/4 percent, setting the rate at 0.75%.  This directly changes the Prime lending rate, which Banks and Mortgage Lenders use to set their rates. It’s no secret that the housing market here in Canada has been hot. In the Waterloo Region alone we have seen prices increase month over month by over 30%, according to the Kitchener-Waterloo Association of REALTORS®. Since the Bank of Canada has held the key interest rate for so long, it is only natural that in a strong economy this rate would eventually increase.  Current mortgage rates have been affected by the market as well: rates have been inflated because of market pricing, and …
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Make Your Voice Heard About Affordable Homes

As you may know, the government has made changes to the rules and regulations around qualifying for mortgage financing last year. We are very proud that Tracy has joined forces with Mortgage Professionals Canada, attempting to drive positive change for Canadians. If you have been affected by these changes in any way, now is your time to speak up! www.tellyourmp.ca is a simple and easy way to express your concerns to those who need to hear it most. If you’re a first-time homebuyer, or looking to refinance – make your voice be heard!  

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