Did you know that along with July, January is the most practical, penny-wise month to go furniture shopping? The after Christmas sales are serious business, and you’re likely to land right in-between on-sale collections for many top home brands. So, if you managed to stick to your Christmas budget, go treat yourself to the fun light-fixture or cushy armchair you’ve had your eye on.
TAMSIN MCMAHON – REAL ESTATE REPORTER
The Globe and Mail
New home buyers taking out insured mortgages will have to dig a bit deeper into their pocketbooks as Canada Mortgage and Housing Corp. announced it will hike mortgage insurance premiums for the third time in the past four years.
The government-owned mortgage insurer said the increases would amount to an extra $5 a month for the typical insured mortgage. The changes apply only to new insured mortgages and would kick in as of March 17.
The move is a response to stricter new capital requirements for mortgage insurers that the Office of the Superintendent of Financial Institutions introduced at the start of the year, part of a broader move to make the mortgage industry more responsive to what regulators see as potential risks to the housing market.
Federal rules require lenders to take out mortgage insurance for any loan in which the borrower has a down payment of less than 20 per cent. The insurance protects lenders in the event that a borrower defaults on the mortgage, but the premiums are typically passed onto borrowers and folded into monthly mortgage payments.
Unlike past premium increases, which have predominantly affected borrowers with small down payments, the changes that take effect in March are more significant for home buyers with bigger down payments.
Home buyers with a 5-per-cent down payment will see their premiums increase by 40 basis points, while premiums will rise by 100 basis points for borrowers with down payments of 15 per cent. (A basis point is 1/100 of a percentage point.)
For example, a home buyer with a 5-per-cent down payment on a $150,000 mortgage pay an extra $2.82 a month on average, while monthly premiums will rise by nearly $40 a month for a buyer with a 15-per-cent down payment on an $850,000 mortgage.
Roughly two-thirds of home buyers taking out a CMHC-insured mortgage have down payments of less than 10 per cent, meaning for most new home buyers the changes will be “negligible,” said Steven Mennill, the Crown corporation’s senior vice-president of insurance.
“We are not doing this to affect housing markets or valuations,” Mr. Mennill said. “That’s not the objective. The objective is simply to preserve the returns on capital in the mortgage industry in a competitive environment.”
However, the premium increases come at a time when first-time buyers are facing mounting challenges to achieving home ownership thanks to mortgage rates that have jumped roughly 50 basis points since November, along with stricter income-testing criteria for insured mortgages and new restrictions on portfolio insurance that lenders sometimes take out on mortgages with down payments greater than 20 per cent.
“On top of the stress test requirements and mortgage rates starting to push up and home prices at all-time highs, I think that 2017 will be the most difficult year for first-time home buyers to enter the market in the last 10 years,” said James Laird, president of mortgage brokerage CanWise Financial.
CMHC’s move will likely come as a relief to the agency’s private-sector competitors, who had been pressing for premium increases to ease the pressure of OSFI’s higher capital requirements. As the dominant government-owned mortgage insurer, CMHC is a price-setter in the mortgage insurance industry and typically makes the first move when it comes to raising and lowering insurance rates.
“We do have a responsibility to make sure that the premiums in the industry are such that the competitive environment is maintained, being the largest mortgage insurer and historically the centre of the pricing industry,” Mr. Mennill said.
The announced increases are slightly higher than what analysts had expected and should be a positive move for private mortgage insurers Genworth MI Canada Inc. and Canada Guaranty, Geoffrey Kwan, a Royal Bank of Canada analyst, wrote in a note to clients on Tuesday.
“We view mortgage insurance price increases as an effective tool to increase mortgage insurer profitability and capital positions yet is unlikely to materially impact the housing market,” he said.
Neither private-sector insurer announced premium changes on Tuesday, but both are expected to follow CMHC. “The price adjustments are reasonable given increased regulatory capital requirements and will support a healthy industry,” Andrew Charles, chief executive of Canada Guaranty, said in an e-mail.
The premium changes represent the latest move in an effort by regulators to protect the financial industry and consumers from rising household debt and soaring house prices in some markets.
After leaving mortgage insurance premiums virtually unchanged for more than a decade, CMHC has raised them three times in recent years. It hiked premiums by an average of 15 per cent in May, 2014, and then raised rates an additional 15 per cent in June, 2015, for borrowers who had down payments of 10 per cent.
CMHC also announced that it was hiking premiums for “non-traditional” insured mortgages, such as those to home buyers with borrowed down payments, which it said it expects to grow in popularity as Canadians struggle to get a foothold in the housing market.
“There is some activity in that borrowed down payment area out in the marketplace, so this is a product that we expect to be used more going forward than it has been perhaps previously,” Mr. Mennill said.
This Cardel “Ellsworth Towne” family home mixes classic comforts and sensible design with appealing modern twists. As natural light streams through generous windows on the main floor, your 9” ceilings will seem even higher.
A sun-lit dining nook adds interest and appeal to the otherwise open plan dining area, and the attractive tiled floor adds style and function to your main living space. A corner gas fire place and kitchen island with 2-person breakfast bar top off the room with cozy charm.
A separate front den/office, a 2pc bathroom and conveniently placed laundry room complete this level.
Upstairs, you’ll find a sun-lit bonus room perfect for hobbies or play, and a balcony. Spa-like fixtures beckon from the master ensuite, like the glass shower and jet tub. Two additional bedrooms and 4pc bathroom complete the upper floor.
The lower floor is partly finished, but is home to a seriously cool rec room. Back lane gives you access to your beautiful backyard, large deck and double detached garage.
For more details click here!
After a long period of economic downturn, Calgary’s housing market is expected to see some price stability in 2017, but not across all market segments and property types. Both detached and attached prices remain unchanged over 2016 levels, while apartment is forecasted to contract by another two per cent.
“The transition in the housing market will be a slow process,” said CREB® chief economist Ann-Marie Lurie. “We are entering the year with high unemployment rates and the possibility that job growth will not occur until the latter portion of 2017. These conditions will continue to weigh on housing demand, but supply is adjusting to weaker sales activity, which will eventually translate into price stability.”
City-wide sales are forecasted to total 18,335 units in 2017, a three per cent gain over 2016, but 12 per cent below long-term averages. This modest demand change will merge with declining listings and easing inventory in the new home market to support more balanced conditions and prevent further downward pressure on prices.
“This year is about moving away from extremely challenging conditions,” said 2017 CREB® president David P. Brown. “The transition is going to take some time, which means sellers need to stick with the fundamentals of pricing their homes correctly against other comparable product in the market. There’s still lots of choice out there for buyers, but major price declines are unlikely in most segments.”
Alberta’s economy was much softer than many predicted over the past two years, as prolonged weakness in energy weighed on other sectors of the economy, including housing. Since the start of the downturn in late 2014, price adjustments have ranged from a low of nearly five per cent in the detached sector, to a high of 11 per cent in the apartment sector. The amount of price change between these different areas of the market was based on how much oversupply there was in each sector at any given time.
Our housing market is moving toward a new equilibrium, but that shift is heavily dependent on stability in the energy sector and overall labour markets. There is also considerable risk from recent government policy changes that could derail expected gains in the second half of 2017. It’s a new outlook this year, but the market risks shouldn’t be overlooked.
For the full report click here
Modern, luxurious living begins and ends in fashionable Marda Loop. Tired of cookie-cutter layouts and unimaginative design? This extraordinary penthouse suite of the coveted Courtyards at Garrison Woods speaks to a new class of contemporary Calgarians. Incredible double-height ceilings and a sunlit, open plan impress straight through the door, while a corner gas fireplace and oversized garden-facing windows make entertaining an effortless thrill. The peninsula kitchen features upgraded appliances, a tiled backsplash, a sizable pantry and slate flooring. Under the stairs is a built-in office nook, and around the corner a convenient powder/laundry room and a spacious balcony.
Last but certainly not least, atop the elegant staircase is the inspiring master retreat — a private loft that stretches the entirety of the suite and features an interior balconied view of the living-space below, and the courtyard beyond. A roomy mirrored closet and 4-piece, modern master-bath polish off this compelling upper floor.
This is a secure, upscale 18+ building with exceptional recreational features including a lap pool and change rooms with shower facilities. The exercise area includes stationary equipment. There is also a clubhouse with a fireplace, kitchen facilities and furnishings. Guest suites are available. Also note there is an assigned, secure underground parking stall, storage locker, air conditioning and integrated sprinkler system. Two blocks from everything you need from, restaurants, groceries and coffee shops to Village Ice Cream. Just a quick trip to Mount Royal University, Glenmore Athletic Park or Downtown.
For more details click here! Call 403-370-2620 to book a private showing!
If you are one of the excited few thinking about taking the leap into the house of your dreams this year, congratulations! Choosing and customizing your home should be among the most thrilling, fulfilling experiences out there. And, just in case you were wondering when this was going to start being about me, well here it is: when buying a new home, it’s a pretty excellent idea to have professional REALTOR® representation. Oh wait, I’m a REALTOR®! What a coincidence!
Let’s talk about show suites for a minute. If you’ve got your eyes on a new build, and feel like browsing around a show suite… HOLD IT! Did you know, that if you don’t have REALTOR® representation the first time you set foot on that site, you may not be allowed to include me as part of the process after that? Basically, if I don’t “introduce” you to the builder, you may lose the right to future REALTOR® representation completely. Yikes is right.
Now, if you’re working with a builder sales rep on a new construction, don’t get me wrong; they will give you quality information regarding development specifications, financing options, upgrades and sales. However, while REALTORS® are contractually obligated to represent the buyer (you), on site sales reps are hired by, and contractually obligated to represent the seller (not you). Think of it as showing up to court without a lawyer, and then asking your opponent’s lawyer for legal advice.…Ok, maybe it’s not that serious. But you know what I mean!
So, as shiny, manicured and tempting as they are, remember to give me a shout before succumbing to the enticing lure of the show home! Plus, then we can grab milkshakes afterwards and chat about it.