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Spring/Summer 2010
The Canadian Real Estate Association predicted the average resale price of a residence in Canada would jump by 5.4% in 2010. To date, the average price in the greater Toronto area has actually grown 13% over the last 12 months.. Economists however are predicting that home prices will level off over the summer and fall. They predict the market will start to dip by 1.5% in 2011. There is a lot of inventoryof homes on the market and predictions are that will continue to climb. This is great news for buyers. With more inventory we are not seeing the bidding wars we saw in the early spring.
With interest rates starting to creep up and with the the banks tightening their mortgage qualification rules we are in for a bit of uncertainty over the next few months. HST also takes effect July 1, 2010 and this should also prove to have a small impact on what buyers and sellers decide to do.
TOPIC OF THE SEASON:
Mortgage Rules change April 19th, 2010!
The federal government has announced changes to the rules for
government-backed insured mortgages (less than 20 percent down payment) as
follows:
- All borrowers will be required to meet the standards for a five-year fixed
rate mortgage even if they choose a mortgage with a lower interest rate and
shorter terms.
- Reduced maximum amount that can be withdrawn in refinancing a
government-backed insured mortgage to 90 per cent from 95 per cent of the value
of the home.
- Require a minimum down payment of 20 per cent for government-backed mortgage
insurance on non-owner occupied properties purchased for speculation. Borrowers
purchasing owner-occupied residential properties will still be able to access
government-backed mortgage insurance with a 5 per cent down
payment. |