Canadian Mortgage News – April 2017


As an Ottawa mortgage broker, I am dedicated to helping my clients exceed their financial goals, no matter what they are. In order to be the best that I can be at helping my clients succeed financially, I strive to be as knowledgeable and prepared as possible.

That is why I stay up to date on industry news, especially as it affects my clients in Ottawa, Oshawa and the surrounding areas.

You may be aware of the new mortgage regulations that were put into place a few months ago. These new rules have caused a lot of uproar throughout the mortgage industry as they have a profound impact on most potential Canadian homeowners.

These changes were not necessarily welcomed by most mortgage professionals because they make it harder for our clients to get the loans they need, which is our ultimate goal as brokers – we want our clients to be able to purchase the homes of their dreams.

In an effort to inform the government of the possible consequences of these most recent changes to Canadian mortgage regulations, some prominent members of the mortgage industry came to Ottawa to participate in a new event, Parliament Hill Advocacy Days.

The main topic of discussion was the potential economic effects of the new mortgage rules that were put into effect in October of 2016, as well as those that were made in January of this year.

These discussions were not brought about because we are expecting immediate change, but because we want the Government to understand the burden that has been placed on many Canadians wishing to purchase a home, but no longer can.

It was the hope of the group who made arguments against certain aspects of these new rules that their insight will be taken into careful consideration and potentially reflected in any future changes.

As always, I am here to help my clients navigate through these uncertain times. I pride myself on my continued service to my clients and to find them the perfect mortgage options to match their financial needs. I work with my clients to make sure they are getting the mortgage options they deserve.

If you have any questions about what these mortgage regulations could mean for you, give me a call today at 1 (888) 421-9330. I am happy to help!




Ottawa Market Update – March 2017

Now is the time to consult with an Ottawa mortgage broker if you are in the market to purchase a home.

According to the Ottawa Real Estate Board, the resale market is off to a great start this year and is expected to lead to a great positive trend for the Ottawa market.

Residential resales in the month of January rose nearly 17% over the same month a year before, which has also translated into more home sales overall

The sale of residential properties showed an increase of 11.5% year over year for the month of January, rising from 598 properties sold in 2016 to 667 in 2017. This figure is a significant amount over the five-year average of 614 for residential sales in the month January. Of the 667 homes that were sold in January of 2017, only 119 were listed in the condominium-class.

Those who are looking to purchase a home in the Ottawa area shouldn’t worry, though! While there has been a sharp increase in home sales over the last couple months, there has also been a large influx of new listings on the market. In fact, the number of homes listed for sale in January was double that of December.

The majority, 35.2 %, of homes sold in January were in the $300,000 – $399,999 price range. The average sale price of residential homes sold in January was recorded at $394,001, only a slight 1.9% higher than the same month a year before. This, again, is great news!

The consistency and stability of these statistics is a testament to the health and strength of the current Ottawa market and a great prediction of what is to come.

There is nothing better than to be able to confidently purchase property in a stable and growing local market and economy.

Ottawa is a great place to find the home of your dreams and as your trusted Ottawa mortgage broker, I am here to help you finance that dream!

Whether you are looking to take advantage of such a solid market and purchase a home, or have considered refinancing your existing mortgage, give us a call today to find out how I can be saving you money!


Canadian Real Estate Market Forecast 2017

The Mortgage Emporium – Mortgage Broker Ottawa 

As trusted Ottawa Mortgage Brokers, we work tirelessly to stay abreast of what’s happening in the market place. Allowing us to offer sound and quality advice to our clients. Many home owners, and prospective home owners are wondering what a Canadian Real Estate Market Forecast in 2017 would like.

2017 Canadian Real Estate Market Forecast

Per the Canadian Real Estate Association (CREA), national sales are forecast to drop in 2017 by 3.3%, compared to the previous year. Specifically, in Ontario, they are looking at home sales to decline in Ontario by 2.7%. To take a look at the full statistics and forecast by province click here to visit CREA’s website.

In its annual year-end report, CREA states: “Transactions in B.C. and Ontario are anticipated to remain strong but fall short of this year’s record levels due to deteriorating affordability, an ongoing shortage of affordably priced listings for single family homes and tightened mortgage regulations.”

Most Canadian markets are leaning towards a flattening out of property prices, with some areas of the country experiencing a decline in both sales activity and prices. As other areas continue to experience price gains, albeit at a much slower pace than we’ve seen in recent years.

Consider the slowing of the Calgary real estate market. We expected aggressive price drops when oil prices crashed, however the market didn’t suffer all that much. Sure, there were price decreases, most neighbourhoods saw price reductions that were less than 5%.

The biggest factor in the predicted 2017 slowdown are the tighter mortgage regulations that were introduced in 2016. “Tightened regulations are expected to reduce the number of first-time buyers who qualify for mortgage financing, particularly in pricier markets, where there is a severe shortage of lower-priced listings.” Click here to read our blog about the change to the Canadian mortgage rules.

If you’re thinking about purchasing a home or refinancing the mortgage your currently have, our Ottawa Mortgage brokers will take the time to discuss your personal and individual financial situation. This way we can offer you the best advice and guidance.

Contact Us Today! The Mortgage Emporium – Mortgage Broker Ottawa


Changes to the Canadian Mortgage Rules

Once again we have Changes to the Canadian Mortgage rules. You’re probably wondering how the new changes will affect your ability to get a mortgage. Mortgages have always been complex that’s why I always recommend working with a licensed Ottawa Mortgage broker like myself.

Stress Test

Home buyers who are seeking an insured mortgage, are now subject to a mortgage rate stress test beginning Oct. 17th 2016. Regardless of how much they have for a down payment. Previously if your down payment was less than 20%, you would have been required to pass a stress test and have mortgage insurance backed by the federal government through the Canada Mortgage and Housing Corporation. You can visit their website by clicking here.

The new stress test is designed to measure whether the buyer could still afford to make payments if mortgage rates rose to the Bank of Canada’s posted five-year fixed mortgage rate. That rate is usually significantly higher than what typical banks or other lenders can offer. For instance, TD has a five-year fixed rate mortgage at 2.59%, while the Bank of Canada’s rate is 4.64% per cent. The test also sets a ceiling of no more than 39% of household income being necessary to cover home-carrying costs such as mortgage payments, taxes and utilities.

Low-Ratio Insurance

Starting Nov.30th 2016, new criteria for low-ratio insurance will take effect. To qualify, the mortgage’s amortization period must be 25 years or less, the purchase price be less than $1 million, the property be owner-occupied, and the buyer have a credit score of 600 or more. Previously, buyers with more than a 20% down, opting for mortgage insurance have escaped such scrutiny. Being able to obtain low-ratio insurance sold through two private insurers, but backed by the federal government, subject to a 10 per cent deductible.

Tax Implications

These new rules also have major tax implications. Beginning this tax year, all home sales must be reported to the Canada Revenue Agency. Click here for their website. The gains from sales of primary residences will remain tax-free. The government is aiming to block foreign buyers from purchasing and flipping homes while falsely claiming the primary residence exemption from capital gains tax.

Despite the changes, whether you’re a first-time home buyer, seasoned investor or refinance an existing property, you’re in good hands. Together we’ll review the best options based on your specific financial situation and discuss how the Changes to the Canadian Mortgage Rules effect you.. Contact us today.

Three Reasons You Should Consider a Mortgage Broker

Generally, there are two ways to get a mortgage in Ontario. You can use a traditional lender, like a bank or a Mortgage Broker. Mortgages are complex and you’re going to have questions. So here are Three Reasons You Should Consider a Mortgage Broker

A Mortgage Broker will save you money

There are many fees that are typically associated when obtaining a mortgage, ranging from application fees to appraisal fees. Often brokers can potentially help by reducing or sometimes even eliminating some of the fees mentioned above thanks in large part to our relationships with a variety of lenders. Brokers are generally able to offer their services for no cost because we only get paid once your mortgage loan is approved and becomes official. When this happens, it is the lenders duty to compensate brokers.

Keep control of your time

Your personal time is important. A licensed mortgage broker will do all the leg work for you. From shopping for the best rates or working to find the best mortgage product for you. Brokers will save you a considerable amount of your own personal time during the mortgage process. Once we sit down together and draw out a plan of your goals and wishes, my team will work to seek the best mortgage based on your unique situation.

From great to not so great credit

It’s true that a great or good credit score makes it easier to get approved, however it certainly isn’t required. Most people think to qualify for a mortgage loan they need to have a tremendous credit score. A mortgage broker like myself can help you get a loan even if your credit score isn’t great. It will all come down to your specific financial situation.

Your trusted Ottawa Mortgage Broker. For a free, no obligation consultation, contact us today!

The Mortgage Emporium - Why use an Ontario Mortgage Broker

Bank of Canada – Hints at Longer Wait for Rate Hike

The Mortgage Emporium – Mortgage Brokers Ottawa

In a move anticipated by most analysts, The Bank of Canada announced today that the overnight rate will remain at 1 per cent target, suggesting it – along with variable rates — won’t rise anytime soon.

The Bank cited “weaker business investment and exports” as a one reason the rate remained the same, along with a pullback in household spending, the European recession, slow but gradual recovery in the U.S and muted inflation.

“Reflecting all of these factors, the Bank has decided to maintain the target for the overnight rate at 1 per cent,” the bank said in a statement. “While some modest withdrawal of monetary policy stimulus will likely be required over time, consistent with achieving the two per cent inflation target, the more muted inflation outlook and the beginnings of a more constructive evolution of imbalances in the household sector suggests that the timing of any such withdrawal is less imminent than previously anticipated.”

Governor Mark Carney’s commentary hinted that no rate hike is in the cards in the near future, but according to Jimmy Jean, economic strategist at Desjardins, his painting of lower interest rates as desirable came as a shock.

“It’s a surprise,” he said, “It has more dovish content than what we were anticipating. The forecast adjustments were pretty much in line with what we were expecting. The language is really where the surprise comes from. We still don’t think we’re likely to see any move (on interest rates) in 2013.”

The announcement likely doesn’t come as a shock to brokers who have been monitoring the rate.

Short-term mortgage rates are unlikely to rise anytime soon, but overall rates are not expected to fall.

The economy slowed more than anticipated in the latter half of 2012, falling below the projections outlined by the Bank in the Monetary Policy Report (MPR) released in October, and is expected to continue at a “restrained” pace until the second half of 2014. The Bank revisited earlier projections for 2013, revising the 2.3 per cent growth estimate to 2 per cent.
carney is expected to address new numbers later today at a press conference alongside Bank of

Canada Senior Deputy Governor Tiff Macklem. The Bank will announce the overnight rate target again on March 6, and provide a fully updated outlook for the economy and inflation in the new MPR released April 17, 2013.

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By Jemima Codrington

Canada’s Waning Growth Puts Balanced Budget at Risk

Theophilos Argitis, Bloomberg News | Jan 21, 2013 1:46 PM ET
More from Bloomberg News

The Mortgage Emporium – Ottawa Mortgage

Aaron Vincent Elkaim/The Canadian PressBudget planners are concerned that weaker revenue may outpace Finance Minister Jim Flaherty’s ability to offset it through accelerated spending cuts.

Canada’s revenue outlook has deteriorated since Finance Minister Jim Flaherty updated his fiscal plan in November amid signs the economy has slowed, making it more difficult to bring the budget into balance, a person with direct knowledge of the government’s budget planning said.

Budget planners are concerned that weaker revenue may outpace Flaherty’s ability to offset it through accelerated spending cuts, especially since the government pledged not to curb transfers to individuals and provinces, the person said on condition they not be identified because they aren’t authorized to speak to the media on the subject. Still, the goal remains to balance the budget by 2015, the person said.

Tax revenues are just not going to be maintaining the pace you would have expected just six months ago

Canada’s economy probably had its worst six-month performance since the end of the 2009 recession in the second half of last year, as exports fell and uncertainty about the global expansion prompted businesses to curb spending, leading economists to scale back their expectations for 2013.

“Tax revenues are just not going to be maintaining the pace you would have expected just six months ago,” said David Watt, chief economist at HSBC Bank Canada.

Flaherty, seeking to return the country to surpluses while ensuring the economy isn’t hurt by fiscal tightening, already scaled back revenue projections in a November budget update by $7-billion for the next fiscal year and by $36-billion over five years, citing lower commodity prices.

Optimistic Forecast

In that update, growth projections for 2013 were cut to 2% from a March forecast of 2.4% when the budget for the fiscal year beginning in April was released. That 2% now looks optimistic.

Slower growth will sap $22-billion a year from Canada’s economy, budget watchdog warns

Parliamentary Budget Officer Kevin Page says in a new report that he anticipates economic growth will brake to an annual rate of 1.6% in the second half of this year, after slowing to 1.8% in the first half.

Read full story here.

Growth in 2013 will probably be closer to 1.7%, according to the median of the forecasts of economists at six Canadian banks: Toronto-Dominion Bank, Canadian Imperial Bank of Commerce, Bank of Nova Scotia, BMO Capital Markets, Royal Bank of Canada and HSBC Canada.

A 0.3 percentage-point reduction in 2013 growth projections may create an additional budget shortfall of more than $1-billion in the next fiscal year and almost $4-billion over three years, according to Bloomberg calculations based on a formula provided by the finance department in its last update. A one-year 1 percentage-point reduction in growth narrows the budget balance by $3.9-billion in the first year and $12.8-billion over three years, according to that formula.

“Growth has not been as firm as they had been expecting,” Watt said. “As a result, the fiscal situation has been a bit more of a challenge.”

Budget Balance

Flaherty has said he will balance the budget before the next federal election, expected in 2015, by cutting departmental expenses and forgoing new spending. A government pledge not to raise taxes or cut transfers to individuals and provinces is handcuffing the government’s ability to meet that goal as revenue wanes.

Direct program spending, which excludes transfers and makes up just under 50% of federal government spending, is projected to decline to $118.9-billion in the fiscal year that begins April 1, down from $120.8-billion projected in the 2012-13 fiscal year, then remain little changed through 2017, according to the November fiscal update. As a share of GDP, direct program expenses will decline to 5.4% by 2017, the lowest since at least 1967, from 6.7% this year.

The finance department also scaled back its revenue assumptions in the update, after final figures for the fiscal 2011-12 showed the government’s revenue as a share of the economy shrank to its lowest in at least 45 years.

Canada now projects total tax revenue as a share of GDP will average 14.3% over the next five years, ranging from 14% in the current year to as high as 14.4% in 2015. That ratio has averaged about 15.5% over the previous 10 years.


Jim Flaherty on home sales dive: ‘I don’t mind prices coming down a bit, too’

TORONTO/OTTAWA — The Globe and Mail
Published Tuesday, Jan. 15 2013, 11:25 AM EST
The way Jim Flaherty sees it, his July changes to Canada’s mortgage rules are having the desired effect on the housing market.
“Well, yeah,” the finance minister told The Globe and Mail. “I don’t mind prices coming down a bit, too.”
Mr. Flaherty’s comments Tuesday followed new numbers showing Canadian home sales posted their fastest year-over-year decline in December since he tightened mortgage rules in July.
Sales of existing homes over the Multiple Listing Service fell 17.4 per cent in December from a year earlier, and were down 0.5 per cent from November, according to the Canadian Real Estate Association.
The MLS Home Price Index, which seeks to factor out changes in the types of homes being sold to get an indication of underlying prices, rose 3.3 per cent from a year earlier. That’s the slowest growth since April of last year.
“Successive rounds of tightening mortgage regulations have kept the housing market in check during what has become an extended low interest rate environment,” said CREA chief economist Gregory Klump.
Having said that, the impact of the new rules are probably fully priced into the market now, said Toronto-Dominion Bank senior economist Sonya Gulati.
Economists at TD went through the data last year in an attempt to quantify just how much of an impact Mr. Flaherty’s four rounds of rule tightening were having.
In a report in September, they concluded that the changes had a significant permanent drop in housing demand, but “while home prices took an immediate hit following the rule changes, they bounced back within two or three quarters and continued to grow faster than underlying economic fundamentals.”
Blame interest rates.
Now, “with the whopping 17.4 per cent year-over-year change in sales seen in December, we suspect that the impacts from the mortgage rule tightening in July are now fully priced in,” Ms. Gulati said Tuesday. “We expect the Canadian housing market to stabilize at current levels over the next few months.”
Indeed, Royal Bank of Canada economist Robert Hogue pointed out that listings declined by more than sales in December, and that should lend some support to prices now. The number of newly listed homes fell 1.3 per cent from November.
The MLS Home Price Index has been declining for six months on a month-over-month basis, and there have been fears that those declines will accelerate.
“But now if supply is adjusting to the lower demand, this may guard against this acceleration of the decline,” Mr. Hogue said in an interview.
He has been of the opinion that the impact of Mr. Flaherty’s latest round of rule changes, which included cutting the maximum length of insured mortgages to 25 years from 30, would only be temporary.
“We’ll get the answer in the coming months,” he said.
And if the sharp declines in year-over-year sales end, and sales flatten out or even pick up a bit, the measures will have run their course, he said.
Ms. Gulati said the sales-to-listings ratio and the number of months of unsold inventory are well within the normal range.
“However, when we compare prices to other standard metrics like price-to-income, we still believe that prices have deviated from underlying economic fundamentals,” she said. “With this in mind, house prices will likely resume their trek downwards once higher interest rates come into effect in the fourth quarter of 2013.”

Why more home sellers are listing in January

Michael Stuparyk/Toronto Star file photo
By Mark Weisleder | Fri Jan 11 2013–why-more-home-sellers-are-listing-in-january
Traditionally, January is a slow month for real estate as most sellers choose to wait until the middle of February in the hopes of capitalizing on the early spring market. However, given the uncertainty in the housing market right now, more sellers are opting to put their house on the market in January.
This presents an opportunity for buyers. Most people are reluctant to uproot their families during the school year, so that means less competition — and fewer bidding wars. Lenders will not be as busy, so buyers can expect a more efficient process to get approved for a mortgage to ensure they have financing in place before making an offer.
But there are things you simply won’t be able to inspect during the winter. Here are some tips for protecting yourself when making a deal during the winter months:
Spruce up the outside: Use urns with light wood branches to brighten up the exterior of your home, to compensate for any overcast day or snow on the ground.
Get rid of the Christmas lights: homes that look dated on the outside give the impression that they are probably dated on the inside.
Make sure your fireplace is working during any showing, that the temperature is comfortable in the home and that any interior lighting compensates for what is usually grey lighting from outside.
Have pictures of your landscaping available from the summer and autumn, showing how beautiful your home looks year round.
Have available any inspections that you may have done on your air-conditioning unit or swimming pool before they were closed for the winter, as buyers will likely not be able to conduct inspections on these items and will have questions.
Consider inviting a company to do an environmental audit on your home in advance, confirming that there is no moisture behind the walls that could lead to mould and that you have sufficient insulation behind the walls.
If there is anything that cannot be inspected because of the winter, such as the air-conditioning system or any swimming pool, then negotiate an extended warranty in the agreement, to give you until at least May 1, to inspect and have the seller be responsible for any damages. In addition, also negotiate a holdback of, say, $2,000 so that if a problem arises, the money comes out of that fund to fix it and you don’t have to chase the seller in court later.
Be careful about snow accumulating around the base of the home. It will be difficult for a home inspector to figure out whether the grading is likely to cause water problems in the basement later. Consider doing your own environmental audit to check for moisture behind any walls.
If the snow on the roof looks like it is evaporating faster than the snow around the house, it is likely a sign that there is not enough insulation in the home.
Check with your insurance company early as to whether you will have any difficulty obtaining insurance on the home; for example, by finding out whether there have been claims made in the neighbourhood about water damages or sewage backups.
Check whether snow accumulation makes it more difficult for street parking, as this may be the only parking available on certain streets. Also see how bad weather may affect your morning commute.
Check the last electric/gas bills, to determine how energy efficient the home is in winter.
People tend to hibernate and stay at home in the winter, so take the opportunity to get to know the neighbours before you finalize your purchase.
By being properly prepared in advance, buyers and sellers can negotiate a safe and successful winter home sale.

Canada’s housing market set for soft landing: Scotiabank

Melissa Leong – Canada’s cooling housing market has made a soft landing with steady sales and pricing through the fall, providing further evidence of an expected gradual decrease rather than a U.S.-style housing market crash, according to a report released Tuesday.
“Canada’s national housing market is shifting toward a more sustainable path, though significant differences in regional conditions continue,” Adrienne Warren, Scotiabank’s senior economist, said in the report entitled Global Real Estate Trends.
Housing demand is expected to be soft which could lower sales and home prices, especially in buyers’ markets such as Vancouver or where there is over supply such as the condominium market in Toronto, it added.
“However, with the Canadian economy continuing to post healthy job growth, and sellers proving responsive to the underlying shift in market conditions, a sharp decline in prices nationally is unlikely.”
Despite an “orderly slowdown,” there are still risks, Ms. Warren cautioned.
“There’s a lot of uncertainty out there in terms of the global economic outlook, whether it’s the U.S. fiscal cliff or the eurozone problems, that can have a significant impact on the Canadian economy and Canadian hiring in 2013,” she said in an interview.
As well, even a soft landing has serious implications for the Canadian economy.
“A lot of activity in recent years, especially Canada’s relative outperformance to other economies, is attributable to the strength of the housing market. It’s generated jobs, a lot of retail spending. We see broad housing investment being a drag on the overall economy.”
Nationally, sales in October were down about 10% from strong spring levels, but only slightly below the average pace of the past decade. Home sales in Alberta and Saskatchewan have increased this year, supported by stronger economic and labour market performance; in contrast in B.C., which faces the greatest housing affordability challenges, sales have dropped about 10% this year, the report said.
Housing starts in 2013 are forecast to drop to around 180,000 units, down from an estimated 215,000 units this year.
Canada’s housing market has been slowing since the spring after years of red-hot growth that sparked debate about a bubble. The market boomed as historically-low interest rates fuelled purchases, driving up prices and adding to household debt. The high and rising home prices combined with the tightening of mortgage insurance rules in recent years have made houses less affordably, notably for first-time buyers.
Meanwhile globally, the report revealed that despite falling housing prices in the advanced and emerging nations that Scotiabank track, there are signs of stabilization in the U.S., the U.K. Australia and China. In the U.S., real home prices rose 5% year-over-year in the third quarter, though average prices remain about 30% lower than their 2005 peak.
Canadians are contributing to the recovery south of the border: in the 12 months to March 2012, foreign purchases of U.S. homes jumped 24%, representing almost 5% of all transactions and Canadians made up 24% of all international buyers.