July 19, 2011
Signals rate hike may be on the horizon
The Bank of Canada held its trend-setting Bank Rate at 1.25 per cent on June 19th, 2011. This marks the seventh consecutive policy decision in which interest rates have been kept on hold.
The Bank has been warning for some time that interest rates will ultimately have to rise, but hinted more strongly in this most recent announcement that a hike was coming by removing the word “eventually” as to when that might happen.
The Bank said, “To the extent that the expansion continues and the current material excess supply in the economy is gradually absorbed, some of the considerable monetary policy stimulus currently in place will be withdrawn, consistent with achieving the 2 per cent inflation target.”
The Bank noted, however, that downside risks to the outlook remain elevated, with debt woes on both sides of the Atlantic, and that the outlook for a gradually improving domestic picture assumes these issues will be contained. As regards the European situation the Bank said, “The Bank’s projection assumes that authorities are able to contain the ongoing European sovereign debt crisis, although there are clear risks around this outcome.”
The Bank’s forcast for economic growth in Canada was little changed from its April forecast. The Bank now expects the economy will grow 2.8 per cent this year. This was revised slightly from the previous forecast of 2.9 per cent. The Bank kept its 2012 and 2013 growth forecasts unchanged at 2.6per cent and 2.1 per cent respectively.
Also unchanged were expectations that the output gap, a measure the spare capacity in the economy, would be closed by the middle of next year, and that headline inflation would remain above 3 per cent in the near term due to temporary factors, namely higher food and energy prices.
The core rate of inflation, which strips out those volatile items, hit 1.8 per cent in May owing to “persistent strength in the prices of some services.” The Bank now expects the core rate to “remain around 2 per cent over the projection horizon.”
As of July 19th, 2011, the advertised five-year lending rate stood at 5.54 per cent. This is down 0.05 percentage points from 5.59 per cent on May 31st, when the Bank made its previous policy interest rate announcement.
The Bank will make its next scheduled rate announcement on September 7, 2011, and many experts had already been forecasting a rate hike at that time. Given the slight change in tone in this most recent announcement, bets for a September hike will likely be increased further. That said, a lot could happen between then and now, particularly given the magnitude of current downside risks.
Copyright CREA reprinted with permission
Showing posts with label Nelson BC Real Estate Kootenay Connector Robert Goertz Valhalla Path Realty. Show all posts
Showing posts with label Nelson BC Real Estate Kootenay Connector Robert Goertz Valhalla Path Realty. Show all posts
Tuesday, July 19, 2011
Canadian Home Sales Pick Up In June
According to statistics released today by The Canadian Real Estate Association (CREA), home sales activity over MLS® Systems of Canadian real estate Boards climbed in June 2011 compared to May.
Highlights:
• Sales activity climbed from May to June, with a big year-over-year gain reflecting falling demand in June 2010.
• Year-to-date sales remain in line with the ten-year average.
• The number of newly listed homes also rose from May to June.
• National housing market remains firmly entrenched in balanced territory.
• National average price still being skewed upward by the value of sales in expensive Vancouver neighbourhoods, with price gains in other markets providing additional loft.
Seasonally adjusted national home sales activity rose 2.6 per cent in June 2011 compared to the previous month. Two-thirds of local markets posted month-over-month gains in June.
Activity remained stable in Toronto while declining slightly in Vancouver and the Fraser Valley. Major markets that saw gains compared to May included Calgary, Montreal, Ottawa, London, Hamilton, and Victoria.
“Canadian housing demand remains resilient, thanks to low interest rates, job growth, and home buyer confidence in the economy,” said Gary Morse, CREA’s President. “That said, local housing market trends often differ from national trends, so buyers and sellers should consult their local REALTOR® to understand how the housing market is shaping up where they live.”
Actual (not seasonally adjusted) activity came in 10.8 per cent above June 2010 levels, but this largely reflects falling sales activity last June. This was also the case for the year-over-year increase in activity in May. Year-over-year comparisons in July may also be stretched by falling activity one year ago, since July 2010 marked the low point for activity last year.
“The Canadian housing sector remains on a solid footing,” said Gregory Klump, CREA’s Chief Economist. “The rise in monthly home sales activity at the end of the second quarter, upbeat business sentiment and hiring intentions, and signs that the Bank of Canada is in no rush to raise interest rates bode well for home sales activity and prices going into the second half of 2011.”
National sales activity was down 4.7 per cent in the second quarter compared to levels in the first quarter. This in part reflects how new mortgage rules announced in January and implemented at the end of March pulled sales forward into the first quarter at the expense of sales activity in April and May. Mortgage interest rates also rose in April and May, which may have moved some home buyers to the sidelines.
A total of 245,170 homes have traded hands via Canadian MLS® Systems in the first half of 2011. Year-to-date sales activity is running in line with the ten-year average, with monthly sales activity having come close to the ten-year average from January to June this year (Chart A). This highlights the relative stability of demand this year compared to the past three years, when activity swung significantly above and below average monthly levels.
The number of newly listed homes also rose nationally by 1.8 per cent from May to June. Gains in Toronto, Vancouver, and Ottawa contributed most to the national increase. The rise in new listings will be especially welcome news for home buyers in Toronto, where listings have been in short supply relative to demand this year.
The national housing market remains firmly planted in balanced territory. The national sales-to-new listings ratio, a measure of market balance, stood at 52.6 per cent in June, little changed from 52.2 per cent in May.
About 60 per cent of local housing markets in Canada were balanced in June. Almost half of the remainder can be classified as sellers’ markets, based on a sales-to-new listings ratio above 60 per cent.
The seasonally adjusted number of months of inventory stood at six months at the end of June on a national basis, holding steady compared to May. The number of months of inventory represents the number of months it would take to sell current inventories at the current rate of sales activity, and is another measure of the balance between housing supply and demand.
The national average price for homes sold in June 2011 was $372,700, up 8.7 per cent from the same month last year. The national average price is becoming less affected by the overall number of sales in some expensive Vancouver neighbourhoods, but is still being pitched higher by the value of those sales. Activity in these neighbourhoods has eased from levels reported in February and March, while sales elsewhere across Canada have risen in line with normal seasonal trends. As a result, property sales above $1 million in Vancouver West, West Vancouver, and Richmond now account for a smaller but still elevated share of national activity.
While the effect of Vancouver activity on the national average price has begun to wane, broadly based price gains in other housing markets are holding the national average price aloft. Close to 80 per cent of local markets posted year-over-year average price gains in June. This includes Toronto, where price gains reflect a tight balance between supply and demand.
Copyright BCREA reprinted with permission
Highlights:
• Sales activity climbed from May to June, with a big year-over-year gain reflecting falling demand in June 2010.
• Year-to-date sales remain in line with the ten-year average.
• The number of newly listed homes also rose from May to June.
• National housing market remains firmly entrenched in balanced territory.
• National average price still being skewed upward by the value of sales in expensive Vancouver neighbourhoods, with price gains in other markets providing additional loft.
Seasonally adjusted national home sales activity rose 2.6 per cent in June 2011 compared to the previous month. Two-thirds of local markets posted month-over-month gains in June.
Activity remained stable in Toronto while declining slightly in Vancouver and the Fraser Valley. Major markets that saw gains compared to May included Calgary, Montreal, Ottawa, London, Hamilton, and Victoria.
“Canadian housing demand remains resilient, thanks to low interest rates, job growth, and home buyer confidence in the economy,” said Gary Morse, CREA’s President. “That said, local housing market trends often differ from national trends, so buyers and sellers should consult their local REALTOR® to understand how the housing market is shaping up where they live.”
Actual (not seasonally adjusted) activity came in 10.8 per cent above June 2010 levels, but this largely reflects falling sales activity last June. This was also the case for the year-over-year increase in activity in May. Year-over-year comparisons in July may also be stretched by falling activity one year ago, since July 2010 marked the low point for activity last year.
“The Canadian housing sector remains on a solid footing,” said Gregory Klump, CREA’s Chief Economist. “The rise in monthly home sales activity at the end of the second quarter, upbeat business sentiment and hiring intentions, and signs that the Bank of Canada is in no rush to raise interest rates bode well for home sales activity and prices going into the second half of 2011.”
National sales activity was down 4.7 per cent in the second quarter compared to levels in the first quarter. This in part reflects how new mortgage rules announced in January and implemented at the end of March pulled sales forward into the first quarter at the expense of sales activity in April and May. Mortgage interest rates also rose in April and May, which may have moved some home buyers to the sidelines.
A total of 245,170 homes have traded hands via Canadian MLS® Systems in the first half of 2011. Year-to-date sales activity is running in line with the ten-year average, with monthly sales activity having come close to the ten-year average from January to June this year (Chart A). This highlights the relative stability of demand this year compared to the past three years, when activity swung significantly above and below average monthly levels.
The number of newly listed homes also rose nationally by 1.8 per cent from May to June. Gains in Toronto, Vancouver, and Ottawa contributed most to the national increase. The rise in new listings will be especially welcome news for home buyers in Toronto, where listings have been in short supply relative to demand this year.
The national housing market remains firmly planted in balanced territory. The national sales-to-new listings ratio, a measure of market balance, stood at 52.6 per cent in June, little changed from 52.2 per cent in May.
About 60 per cent of local housing markets in Canada were balanced in June. Almost half of the remainder can be classified as sellers’ markets, based on a sales-to-new listings ratio above 60 per cent.
The seasonally adjusted number of months of inventory stood at six months at the end of June on a national basis, holding steady compared to May. The number of months of inventory represents the number of months it would take to sell current inventories at the current rate of sales activity, and is another measure of the balance between housing supply and demand.
The national average price for homes sold in June 2011 was $372,700, up 8.7 per cent from the same month last year. The national average price is becoming less affected by the overall number of sales in some expensive Vancouver neighbourhoods, but is still being pitched higher by the value of those sales. Activity in these neighbourhoods has eased from levels reported in February and March, while sales elsewhere across Canada have risen in line with normal seasonal trends. As a result, property sales above $1 million in Vancouver West, West Vancouver, and Richmond now account for a smaller but still elevated share of national activity.
While the effect of Vancouver activity on the national average price has begun to wane, broadly based price gains in other housing markets are holding the national average price aloft. Close to 80 per cent of local markets posted year-over-year average price gains in June. This includes Toronto, where price gains reflect a tight balance between supply and demand.
Copyright BCREA reprinted with permission
Home Sales to Rise 5 Per Cent This Year
BCREA 2011 Second Quarter Housing Forecast
Vancouver, BC – June 30, 2011. The British Columbia Real Estate Association (BCREA) released its 2011 Second Quarter Housing Forecast today.
BC Multiple Listing Service® (MLS®) residential sales are forecast to increase 5 per cent from 74,640 units in 2010 to 78,200 units this year, before increasing a further 3.1 per cent to 80,700 units in 2012.
“Home sales will post some modest gains over the next two years,” said Cameron Muir, BCREA Chief Economist. “However, positive housing fundamentals like job growth, rising wages and an expanding population base will be somewhat offset by higher borrowing costs over the next eighteen months.”
“Following a decade where unit sales broke all records, consumer demand over the next few years will be relatively moderate,” added Muir. The ten-year BC MLS® residential sales average is 87,000 units. A record 106,300 MLS® residential sales were recorded in 2005.
Copyright BCREA reprinted with permission
Vancouver, BC – June 30, 2011. The British Columbia Real Estate Association (BCREA) released its 2011 Second Quarter Housing Forecast today.
BC Multiple Listing Service® (MLS®) residential sales are forecast to increase 5 per cent from 74,640 units in 2010 to 78,200 units this year, before increasing a further 3.1 per cent to 80,700 units in 2012.
“Home sales will post some modest gains over the next two years,” said Cameron Muir, BCREA Chief Economist. “However, positive housing fundamentals like job growth, rising wages and an expanding population base will be somewhat offset by higher borrowing costs over the next eighteen months.”
“Following a decade where unit sales broke all records, consumer demand over the next few years will be relatively moderate,” added Muir. The ten-year BC MLS® residential sales average is 87,000 units. A record 106,300 MLS® residential sales were recorded in 2005.
Copyright BCREA reprinted with permission
Sunday, May 22, 2011
Home Sales Slow After Strong First Quarter
The British Columbia Real Estate Association (BCREA) reports that Multiple Listing Service® (MLS®) residential unit sales in the province declined 14 per cent to 7,187 units in April compared to the same month last year. The average MLS® residential price climbed 16 per cent to $598,308 last month compared to April 2010.
"BC home sales edged lower in April as the result of home purchases that were pulled forward during the first quarter,” said Cameron Muir, BCREA Chief Economist. “The province’s housing markets continue to exhibit a two steps forward, one step back trajectory in tandem with economic and employment growth."
Year-to-date, BC residential sales dollar volume increased 14 per cent to $15.4 billion, compared to the same period last year. Residential unit sales edged back one per cent to 26,334 units, while the average MLS® residential price rose 15.5 per cent to $586,466 over the same period.
Copyright BCREA Reprinted with permission
"BC home sales edged lower in April as the result of home purchases that were pulled forward during the first quarter,” said Cameron Muir, BCREA Chief Economist. “The province’s housing markets continue to exhibit a two steps forward, one step back trajectory in tandem with economic and employment growth."
Year-to-date, BC residential sales dollar volume increased 14 per cent to $15.4 billion, compared to the same period last year. Residential unit sales edged back one per cent to 26,334 units, while the average MLS® residential price rose 15.5 per cent to $586,466 over the same period.
Copyright BCREA Reprinted with permission
Monday, April 18, 2011
National home sales hold steady in March
OTTAWA – April 15th, 2011 – According to statistics released today by The Canadian Real Estate Association (CREA), national resale housing activity held steady in March 2011 compared to February.
Seasonally adjusted national home sales activity in March came in one tenth of a percentage point above levels for the previous month, with stable demand in most large urban centres.
With national sales in each of the first three months of 2011 running close to their five- or ten-year monthly averages, seasonally adjusted national sales activity in the first quarter of 2011 was up 4.5 per cent from levels recorded in the fourth quarter of last year, and reached the highest quarterly level in a year.
Most of the quarterly increase in seasonally adjusted national sales activity was due to demand in Vancouver and Toronto. Recent changes to mortgage regulations may have caused a number of sales in some of Canada’s more expensive housing markets to be brought forward into the first quarter that would have otherwise occurred later in the year.
Sellers looking to trade up before changes to mortgage regulations took effect made their move early, resulting in a significant rise in newly listed homes in January and February of this year. With changes to mortgage regulations looming in March, seasonally adjusted new residential listings for the month dropped five per cent month-to-month.
Steady sales activity combined with fewer new listings tightened the national resale housing market. The national sales-to-new listings ratio, a measure of the balance between supply and demand, stood at 56.5 per cent in March. This kept the national housing market firmly entrenched in balanced territory, with March marking the firmest reading for national market balance in more than a year.
Based on sales-to-new listings ratios, more than half of local markets in Canada could be considered balanced in March, with two-thirds of the remaining markets considered to be as sellers’ markets.
“The majority of local housing markets across Canada are well balanced, but not all of them are,” said Gary Morse, CREA’s President. “Within a province or local market, the balance between resale housing supply and demand can vary widely and evolve quickly, so buyers and sellers should speak with a local REALTOR® to understand housing market trends where they live.”
The number of months of inventory represents the number of months it would take to sell current inventories at the current rate of sales activity, and is another measure of the balance between housing supply and demand. The seasonally adjusted number of months of inventory stood at 5.6 months at the end of March on a national basis. This was unchanged from the previous month. Almost half of all local markets saw the number of months of inventory shrink compared to the previous month.
Throughout the first quarter of 2011, the national average price was skewed higher by strong activity in a few pricey areas of Greater Vancouver. March 2011 was no exception, with an increase of 8.9 per cent year-over year.
“A record number of multi-million dollar property sales in Richmond and Vancouver West are pushing up average prices for Greater Vancouver, British Columbia and nationally,” stated Gregory Klump, CREA’s Chief Economist. “If Vancouver is excluded from the equation, the national average price increase is cut by more than half to 4.3 per cent.”
“Looking ahead, evidence suggests that the potential rush of sales activity in March before recent changes to mortgage regulations took effect was a story that was largely focused in condo sales activity in Greater Vancouver. This confirms that the expected impact on sales activity of recent changes to mortgage regulations will likely be minor over the near term. Interest rates are now widely expected to remain on hold until at least mid-July, which is supportive for resale housing demand, market balance and prices,” Klump added.
Copyright CREA reprinted with permission
Seasonally adjusted national home sales activity in March came in one tenth of a percentage point above levels for the previous month, with stable demand in most large urban centres.
With national sales in each of the first three months of 2011 running close to their five- or ten-year monthly averages, seasonally adjusted national sales activity in the first quarter of 2011 was up 4.5 per cent from levels recorded in the fourth quarter of last year, and reached the highest quarterly level in a year.
Most of the quarterly increase in seasonally adjusted national sales activity was due to demand in Vancouver and Toronto. Recent changes to mortgage regulations may have caused a number of sales in some of Canada’s more expensive housing markets to be brought forward into the first quarter that would have otherwise occurred later in the year.
Sellers looking to trade up before changes to mortgage regulations took effect made their move early, resulting in a significant rise in newly listed homes in January and February of this year. With changes to mortgage regulations looming in March, seasonally adjusted new residential listings for the month dropped five per cent month-to-month.
Steady sales activity combined with fewer new listings tightened the national resale housing market. The national sales-to-new listings ratio, a measure of the balance between supply and demand, stood at 56.5 per cent in March. This kept the national housing market firmly entrenched in balanced territory, with March marking the firmest reading for national market balance in more than a year.
Based on sales-to-new listings ratios, more than half of local markets in Canada could be considered balanced in March, with two-thirds of the remaining markets considered to be as sellers’ markets.
“The majority of local housing markets across Canada are well balanced, but not all of them are,” said Gary Morse, CREA’s President. “Within a province or local market, the balance between resale housing supply and demand can vary widely and evolve quickly, so buyers and sellers should speak with a local REALTOR® to understand housing market trends where they live.”
The number of months of inventory represents the number of months it would take to sell current inventories at the current rate of sales activity, and is another measure of the balance between housing supply and demand. The seasonally adjusted number of months of inventory stood at 5.6 months at the end of March on a national basis. This was unchanged from the previous month. Almost half of all local markets saw the number of months of inventory shrink compared to the previous month.
Throughout the first quarter of 2011, the national average price was skewed higher by strong activity in a few pricey areas of Greater Vancouver. March 2011 was no exception, with an increase of 8.9 per cent year-over year.
“A record number of multi-million dollar property sales in Richmond and Vancouver West are pushing up average prices for Greater Vancouver, British Columbia and nationally,” stated Gregory Klump, CREA’s Chief Economist. “If Vancouver is excluded from the equation, the national average price increase is cut by more than half to 4.3 per cent.”
“Looking ahead, evidence suggests that the potential rush of sales activity in March before recent changes to mortgage regulations took effect was a story that was largely focused in condo sales activity in Greater Vancouver. This confirms that the expected impact on sales activity of recent changes to mortgage regulations will likely be minor over the near term. Interest rates are now widely expected to remain on hold until at least mid-July, which is supportive for resale housing demand, market balance and prices,” Klump added.
Copyright CREA reprinted with permission
Two Speed Market Continues for BC Home Sales
Vancouver, BC – April 18, 2011. The British Columbia Real Estate Association (BCREA) reports that Multiple Listing Service® (MLS®) residential sales in the province continued to climb higher in March. Compared to March of 2010, MLS® residential unit sales increased 11.5 per cent to 8,600 units. The average MLS® residential price rose 15 per cent to $594,157 in March compared to the same month last year.
"We continue to observe a two-speed market in BC, with surging consumer demand in Metro Vancouver overshadowing more moderate demand in other regions," said Cameron Muir, BCREA Chief Economist. "Vigorous consumer demand drove Greater Vancouver to its most active March since 2004, while the Fraser Valley had its strongest March in four years. Conversely, sales activity in other BC markets is expanding at a pace more inline with overall economic growth."
Year-to-date, BC residential sales dollar volume increased 21 per cent to $11.14 billion, compared to the same period last year. Residential unit sales increased 4.7 per cent to 19,147 units. The average MLS® residential price rose 15.4 per cent to $582,021 over the same period.
Copyright BCREA reprinted with permission
"We continue to observe a two-speed market in BC, with surging consumer demand in Metro Vancouver overshadowing more moderate demand in other regions," said Cameron Muir, BCREA Chief Economist. "Vigorous consumer demand drove Greater Vancouver to its most active March since 2004, while the Fraser Valley had its strongest March in four years. Conversely, sales activity in other BC markets is expanding at a pace more inline with overall economic growth."
Year-to-date, BC residential sales dollar volume increased 21 per cent to $11.14 billion, compared to the same period last year. Residential unit sales increased 4.7 per cent to 19,147 units. The average MLS® residential price rose 15.4 per cent to $582,021 over the same period.
Copyright BCREA reprinted with permission
Wednesday, March 9, 2011
HOME BUYING INTENTIONS REMAIN STEADY IN B.C.: RBC POLL
Interest in buying a home has remained steady in B.C. with 29 per cent of residents indicating they are likely to buy a home in the next two years, on par with the national average and equal to last year, according to the 18th annual RBC Homeownership Study.
When asked to list their top worry when planning to purchase, over one-third (34per cent) of British Columbians are most concerned with home prices increasing, the most in Canada. Having a good down payment is the top worry for 20 per cent.
“B.C.’s housing market has experienced some volatility over the past few years so it makes sense that buyers are concerned about rising prices and having the proper down payment,” said Inde Sumal, regional vice president, residential mortgages, RBC. “When making the decision to purchase a home, seeking the advice of a qualified professional can help you decide on what type of mortgage, home and savings plan is right to meet your individual needs and ownership goals.”
While more homebuyers believe it makes sense to buy a home this year (54 per cent), rather than waiting until next year (46 per cent), the gap has narrowed from 2010 (68 per cent versus 32 per cent).
Homeowners in B.C. are slightly less optimistic than last year about the price of their home, as 67 per cent feel the value of their home has increased in the past two years and 16 per cent believe that the value of their home has decreased.
New homes are gaining in popularity, as 30 per cent plan to buy a new home rather than a resale, the highest in the country and eight points above the national average. Those intending to buy a home are also looking more long-term, with almost four-in-ten (79 per cent) planning to purchase in the next one to two years rather than right now. Almost half (48 per cent) of the province believes that it’s a buyers market, which is eight points above the national average.
British Columbians indicate they are looking buy the following types of homes according to the 18th Annual RBC Homeownership Poll:
• Detached house 54 per cent
• Condo/loft 17 per cent
• Semi detached house 11 per cent
• Townhouse 13 per cent
Royal Bank of Canada March 9, 2011
When asked to list their top worry when planning to purchase, over one-third (34per cent) of British Columbians are most concerned with home prices increasing, the most in Canada. Having a good down payment is the top worry for 20 per cent.
“B.C.’s housing market has experienced some volatility over the past few years so it makes sense that buyers are concerned about rising prices and having the proper down payment,” said Inde Sumal, regional vice president, residential mortgages, RBC. “When making the decision to purchase a home, seeking the advice of a qualified professional can help you decide on what type of mortgage, home and savings plan is right to meet your individual needs and ownership goals.”
While more homebuyers believe it makes sense to buy a home this year (54 per cent), rather than waiting until next year (46 per cent), the gap has narrowed from 2010 (68 per cent versus 32 per cent).
Homeowners in B.C. are slightly less optimistic than last year about the price of their home, as 67 per cent feel the value of their home has increased in the past two years and 16 per cent believe that the value of their home has decreased.
New homes are gaining in popularity, as 30 per cent plan to buy a new home rather than a resale, the highest in the country and eight points above the national average. Those intending to buy a home are also looking more long-term, with almost four-in-ten (79 per cent) planning to purchase in the next one to two years rather than right now. Almost half (48 per cent) of the province believes that it’s a buyers market, which is eight points above the national average.
British Columbians indicate they are looking buy the following types of homes according to the 18th Annual RBC Homeownership Poll:
• Detached house 54 per cent
• Condo/loft 17 per cent
• Semi detached house 11 per cent
• Townhouse 13 per cent
Royal Bank of Canada March 9, 2011
Preparing Your Home for Sale
When getting your home ready to sell, you need to look at your house in a new way. Think of your house as a product about to go on the market where it is probably competing with brand new housing. It needs to show well – which means clutter-free and well kept.
Today’s homebuyers lead busy lives and may not be interested in taking on major repairs or improvements upon moving in. You need to make your house a “10”. This document will help you spot what is right and what is not so good about your "product". It will give you the opportunity to take corrective action to ensure your house looks fresh, clean and well maintained when the “For Sale” sign goes up.
Fix It First
If you need to make improvements to your home, do the work before it goes on the market. Potential buyers are not interested in hearing about your good intentions to look after defects before a transfer of ownership takes place. Even if fix-up work is underway, buyers may not be able to visualize what your home will look like when the work is finished. They will just remember it being in a state of disrepair.
Professional Inspection: Yes or No?
A serious buyer may want to have a professional home inspector check your house from top to bottom before making an offer. Even though this guide will help you identify problems on your own, the option of hiring a professional home inspector is open to you as well. If you can afford it, an inspection in advance of putting your home on the market is a good idea. It is your best way of finding and taking care of serious deficiencies before an inspector hired by a potential buyer discovers them.
Today’s homebuyers lead busy lives and may not be interested in taking on major repairs or improvements upon moving in. You need to make your house a “10”. This document will help you spot what is right and what is not so good about your "product". It will give you the opportunity to take corrective action to ensure your house looks fresh, clean and well maintained when the “For Sale” sign goes up.
Fix It First
If you need to make improvements to your home, do the work before it goes on the market. Potential buyers are not interested in hearing about your good intentions to look after defects before a transfer of ownership takes place. Even if fix-up work is underway, buyers may not be able to visualize what your home will look like when the work is finished. They will just remember it being in a state of disrepair.
Professional Inspection: Yes or No?
A serious buyer may want to have a professional home inspector check your house from top to bottom before making an offer. Even though this guide will help you identify problems on your own, the option of hiring a professional home inspector is open to you as well. If you can afford it, an inspection in advance of putting your home on the market is a good idea. It is your best way of finding and taking care of serious deficiencies before an inspector hired by a potential buyer discovers them.
Home Price Index Moving Up
The Canadian Resale market swung upwards in December, according to the latest release of the Teranet-National Bank Composite House Price Index- which indicated increases in five of the six markets surveyed.
The index indicates that prices were up 0.3% in December from November, as well as having gone up 4.1% from the same time the year before.
Looking at specific regions, there was a 0.1% increase in Calgary- which signalled the first gain out of the last five months. In Vancouver and Montreal both, the rise was 0.5%. Toronto rose 0.2%. Halifax was a much larger 3.6%- which did not impact the overall index as much as one might think. On the other side of the spectrum, Ottawa declined by 0.4%- which is the fourth consecutive decline.
Looking year-over-year, this was the “sixth month in a row of deceleration”- with the only exception being Halifax, where they accelerated by 8.5%.
The report says,” Data for January from the Canadian Real Estate Association show generally balanced conditions in major urban markets. Toronto and Vancouver could even be considered rather tight markets. The federal minister of finance announced January 17 that the maximum amortization period for an insured mortgage will be reduced to 30 years from 35 years effective March 18. This prospect could influence the resale market between now and the effective date.”
Propertywire.ca Thursday, 24 February 2011
The index indicates that prices were up 0.3% in December from November, as well as having gone up 4.1% from the same time the year before.
Looking at specific regions, there was a 0.1% increase in Calgary- which signalled the first gain out of the last five months. In Vancouver and Montreal both, the rise was 0.5%. Toronto rose 0.2%. Halifax was a much larger 3.6%- which did not impact the overall index as much as one might think. On the other side of the spectrum, Ottawa declined by 0.4%- which is the fourth consecutive decline.
Looking year-over-year, this was the “sixth month in a row of deceleration”- with the only exception being Halifax, where they accelerated by 8.5%.
The report says,” Data for January from the Canadian Real Estate Association show generally balanced conditions in major urban markets. Toronto and Vancouver could even be considered rather tight markets. The federal minister of finance announced January 17 that the maximum amortization period for an insured mortgage will be reduced to 30 years from 35 years effective March 18. This prospect could influence the resale market between now and the effective date.”
Propertywire.ca Thursday, 24 February 2011
Home Ownership More Affordable: RBC
Home affordability continued to improve for Canadians in the last quarter, according to the Housing Trends and Affordability report released by RBC Economics Research. Slight rises in home price appreciation, coupled with a modest dip in five-year mortgage rates are the most likely factors.
"Some of the stress that had been building in the housing market between 2009 and the first half of 2010 has been relieved, but tensions persist overall and the recent improvement in affordability is likely to be short-lived," said Robert Hogue, senior economist, RBC, speaking with PropertyWire.Ca. "We expect that the Bank of Canada will resume its rate hike campaign this spring and with borrowing costs set to climb further in the next two years, housing affordability will erode across the country. That said, we don't expect this to derail the housing market because of rising household income and job creation from the sustained economic recovery."
Says Hogue, there are additional elements leading to an expectation of balance. “There is also expected balance between supply and demand. Prices will also likely stay flat, with small increases. In that context- the market is calm and moving sideways in the likely outcome. There is no real rush to buy, and no rush to sell.”
“Across the country, markets by and large are in balanced range.”
Price appreciation has fallen back to more manageable levels, in the face of this new balance in the market. The expectation is that price appreciation will continue, but a much slower, and more sustainable pace than had been seen in recent years.
"We expect affordability measures will rise gradually in the next three years or so while monetary policy is readjusted, but will land softly thereafter once interest rates stabilize at higher levels," added Hogue. "This pattern would be consistent with moderate yet sustained stress on Canada's housing market. Overall, the era of rapid home price appreciation of the past 10 years has likely run its course and we believe that Canada has entered a period of very modest increases."
Looking at different housing types across the country, the detached bungalow benchmark measure fell back slightly to 39.9 %; Standard condominium measure fell to 27.6 %; the standard two-storey home fell to 46. %.
Most provinces reported forward movement in terms of affordability- most notably in Alberta. Decreases continued in Alberta- this time declining by “1.0 to 2.4 percentage points.” This builds on top of consistent declines since 2007. The combination of lower interest rates, and steadily decreasing home prices, have both contributed to the increase in affordability.
According to the report, the days for this may be numbered in Alberta,” The significant improvement in affordability is near the end of its line, however, as demand has shown more vigour in recent months - alongside a provincial economy that is gaining more traction - and the market has become better balanced. RBC expects that this will stem price declines this year, thereby removing a potential offset to the negative effect of projected rise in interest rates on affordability.”
Propertywire.ca Friday, 25 February 2011
"Some of the stress that had been building in the housing market between 2009 and the first half of 2010 has been relieved, but tensions persist overall and the recent improvement in affordability is likely to be short-lived," said Robert Hogue, senior economist, RBC, speaking with PropertyWire.Ca. "We expect that the Bank of Canada will resume its rate hike campaign this spring and with borrowing costs set to climb further in the next two years, housing affordability will erode across the country. That said, we don't expect this to derail the housing market because of rising household income and job creation from the sustained economic recovery."
Says Hogue, there are additional elements leading to an expectation of balance. “There is also expected balance between supply and demand. Prices will also likely stay flat, with small increases. In that context- the market is calm and moving sideways in the likely outcome. There is no real rush to buy, and no rush to sell.”
“Across the country, markets by and large are in balanced range.”
Price appreciation has fallen back to more manageable levels, in the face of this new balance in the market. The expectation is that price appreciation will continue, but a much slower, and more sustainable pace than had been seen in recent years.
"We expect affordability measures will rise gradually in the next three years or so while monetary policy is readjusted, but will land softly thereafter once interest rates stabilize at higher levels," added Hogue. "This pattern would be consistent with moderate yet sustained stress on Canada's housing market. Overall, the era of rapid home price appreciation of the past 10 years has likely run its course and we believe that Canada has entered a period of very modest increases."
Looking at different housing types across the country, the detached bungalow benchmark measure fell back slightly to 39.9 %; Standard condominium measure fell to 27.6 %; the standard two-storey home fell to 46. %.
Most provinces reported forward movement in terms of affordability- most notably in Alberta. Decreases continued in Alberta- this time declining by “1.0 to 2.4 percentage points.” This builds on top of consistent declines since 2007. The combination of lower interest rates, and steadily decreasing home prices, have both contributed to the increase in affordability.
According to the report, the days for this may be numbered in Alberta,” The significant improvement in affordability is near the end of its line, however, as demand has shown more vigour in recent months - alongside a provincial economy that is gaining more traction - and the market has become better balanced. RBC expects that this will stem price declines this year, thereby removing a potential offset to the negative effect of projected rise in interest rates on affordability.”
Propertywire.ca Friday, 25 February 2011
Thursday, February 24, 2011
Home Sales to Climb Eight Per Cent in 2011
BCREA Housing Forecast Update - First Quarter 2011
Vancouver, BC – February 23, 2011. The British Columbia Real Estate Association (BCREA) released its Housing Forecast for the first quarter of 2011 today.
BC Multiple Listing Service® (MLS®) residential sales are forecast to increase 8 per cent from 74,640 units in 2010 to 80,900 units this year, and increase another 4 per cent to 83,950 units in 2012.
“British Columbia housing markets are returning to normalcy after two years of volatility,” said Cameron Muir, BCREA Chief Economist. “Employment and population growth will fuel consumer demand over the next two years. However, higher mortgage interest rates and tighter credit conditions for low equity home buyers will limit home sales to below the ten-year average of 87,600 units.”
“Total active residential listings in the province declined 14 per cent since last spring. However, the inventory of homes for sale is expected to edge higher as the number of new listings to the market advances during the first two quarters of 2011,” added Muir. “Regional market differences continue in the province, with Vancouver trending into a seller’s market, while the Okanagan, Kootenay and Kamloops markets trend from a buyer’s market toward balanced conditions.”
The average MLS® residential price is forecast to increase 2 per cent to $517,000 this year and remain relatively unchanged in 2012, albeit declining by 0.4 per cent to $515,400
Copyright BCREA reprinted with permission
Vancouver, BC – February 23, 2011. The British Columbia Real Estate Association (BCREA) released its Housing Forecast for the first quarter of 2011 today.
BC Multiple Listing Service® (MLS®) residential sales are forecast to increase 8 per cent from 74,640 units in 2010 to 80,900 units this year, and increase another 4 per cent to 83,950 units in 2012.
“British Columbia housing markets are returning to normalcy after two years of volatility,” said Cameron Muir, BCREA Chief Economist. “Employment and population growth will fuel consumer demand over the next two years. However, higher mortgage interest rates and tighter credit conditions for low equity home buyers will limit home sales to below the ten-year average of 87,600 units.”
“Total active residential listings in the province declined 14 per cent since last spring. However, the inventory of homes for sale is expected to edge higher as the number of new listings to the market advances during the first two quarters of 2011,” added Muir. “Regional market differences continue in the province, with Vancouver trending into a seller’s market, while the Okanagan, Kootenay and Kamloops markets trend from a buyer’s market toward balanced conditions.”
The average MLS® residential price is forecast to increase 2 per cent to $517,000 this year and remain relatively unchanged in 2012, albeit declining by 0.4 per cent to $515,400
Copyright BCREA reprinted with permission
Tuesday, February 22, 2011
'Condo King' sells 128 Olympic Village units
Vancouver real estate guru Bob Rennie has managed to sell 128 condos at the former Olympic Village site over the weekend, he announced on Tuesday morning.
The sales are still subject to financing, but Rennie says response has been so strong he's considering clawing back some of the units that had been identified as rental condos.
Rennie says taxpayers of Vancouver, who are currently financially responsible for the project, should be pleased with the response. He had promised the receiver of the troubled condominium development that he would sell 60 condos in 60 days.
"I think we are off and running now and I just want to be cautiously optimistic that we have stabilized the asset for the taxpayer and now its time to move forward on an orderly basis," said Rennie.
The average price for the units sold was $778,000. The most expensive unit sold was nearly $3 million and the cheapest was $329,000.
"If we are together in a week and I can say I've sold another 20 or 25, I'll be a really happy guy," he said.
Tent city protest planned
As Rennie spoke, protesters gathered at the Olympic village site, angry the village contains far fewer social housing units than originally promised.
The city originally planned to use about 250 units in the development as low income social housing, but that figure was cut to 125 last year, when the city decided to rent 125 of the units to emergency workers at market rates.
Organizer Nathan Crompton says a tent village will be erected at the site on Saturday.
"I hope that Vancouver sees this as a city-wide issue and that thousands of people come down and to say that we are going to disrupt this marketing effort every day until we get the housing legacy that was promised," said Crompton.
Taxpayers still on the hook
A total of 230 units were offered for sale this past weekend. Another 265 units in the development were sold before completion and 250 have been assigned as rental stock by the city.
The $1 billion development, which has a total of 1,100 residential suites, has been in financial trouble since the original financiers backed out of the project prior to the 2010 Olympic Games.
The City of Vancouver was forced to step in and provide about $700 million in emergency financing. But the downturn in the real estate market made it difficult to sell the units after the Games, forcing the city to eventually agree to Rennie's plan to slash prices last week by an average of 30 per cent.
Rennie, who's been nicknamed the 'Condo King,' earned his reputation as real estate marketing guru by selling thousands of condo in projects across B.C.'s Lower Mainland
CBC NEWS February 22, 2011
The sales are still subject to financing, but Rennie says response has been so strong he's considering clawing back some of the units that had been identified as rental condos.
Rennie says taxpayers of Vancouver, who are currently financially responsible for the project, should be pleased with the response. He had promised the receiver of the troubled condominium development that he would sell 60 condos in 60 days.
"I think we are off and running now and I just want to be cautiously optimistic that we have stabilized the asset for the taxpayer and now its time to move forward on an orderly basis," said Rennie.
The average price for the units sold was $778,000. The most expensive unit sold was nearly $3 million and the cheapest was $329,000.
"If we are together in a week and I can say I've sold another 20 or 25, I'll be a really happy guy," he said.
Tent city protest planned
As Rennie spoke, protesters gathered at the Olympic village site, angry the village contains far fewer social housing units than originally promised.
The city originally planned to use about 250 units in the development as low income social housing, but that figure was cut to 125 last year, when the city decided to rent 125 of the units to emergency workers at market rates.
Organizer Nathan Crompton says a tent village will be erected at the site on Saturday.
"I hope that Vancouver sees this as a city-wide issue and that thousands of people come down and to say that we are going to disrupt this marketing effort every day until we get the housing legacy that was promised," said Crompton.
Taxpayers still on the hook
A total of 230 units were offered for sale this past weekend. Another 265 units in the development were sold before completion and 250 have been assigned as rental stock by the city.
The $1 billion development, which has a total of 1,100 residential suites, has been in financial trouble since the original financiers backed out of the project prior to the 2010 Olympic Games.
The City of Vancouver was forced to step in and provide about $700 million in emergency financing. But the downturn in the real estate market made it difficult to sell the units after the Games, forcing the city to eventually agree to Rennie's plan to slash prices last week by an average of 30 per cent.
Rennie, who's been nicknamed the 'Condo King,' earned his reputation as real estate marketing guru by selling thousands of condo in projects across B.C.'s Lower Mainland
CBC NEWS February 22, 2011
Housing Activity to Move in Line with Demographic Fundamentals in 2011
After trending lower in the second half of 2010, housing starts are forecast to stabilize at levels consistent with demographic fundamentals in 2011 and 2012, according to Canada Mortgage and Housing Corporation’s (CMHC) first quarter Housing Market Outlook, Canada Edition.
Housing starts will be in the range of 157,300 to 192,900 units in 2011, with a point forecast of 177,600 units. In 2012, housing starts will be in the range of 154,600 to 211,200 units, with a point forecast of 183,800 units.
“Modest economic growth will continue to push employment levels higher this year and next. This, in conjunction with relatively low mortgage rates, will continue to support demand for new homes. Housing starts will remain in line with long term demographic fundamentals over the course of 2011 and 2012,” said Bob Dugan, Chief Economist for CMHC.
Existing home sales will be in the range of 398,500 to 485,500 units in 2011, with a point forecast of 441,500 units. In 2012, MLS®2 sales will move up and are expected to be in the range of 406,300 to 519,700 units, with a point forecast of 462,900 units.
Mr. Dugan also noted that the existing home market will remain in the balanced to sellers’ market range in 2011 and 2012. As a result, growth in the average MLS® price is expected to remain in line with economy-wide inflation in 2011 and 2012.
CMHC February 17, 2011
Housing starts will be in the range of 157,300 to 192,900 units in 2011, with a point forecast of 177,600 units. In 2012, housing starts will be in the range of 154,600 to 211,200 units, with a point forecast of 183,800 units.
“Modest economic growth will continue to push employment levels higher this year and next. This, in conjunction with relatively low mortgage rates, will continue to support demand for new homes. Housing starts will remain in line with long term demographic fundamentals over the course of 2011 and 2012,” said Bob Dugan, Chief Economist for CMHC.
Existing home sales will be in the range of 398,500 to 485,500 units in 2011, with a point forecast of 441,500 units. In 2012, MLS®2 sales will move up and are expected to be in the range of 406,300 to 519,700 units, with a point forecast of 462,900 units.
Mr. Dugan also noted that the existing home market will remain in the balanced to sellers’ market range in 2011 and 2012. As a result, growth in the average MLS® price is expected to remain in line with economy-wide inflation in 2011 and 2012.
CMHC February 17, 2011
Monday, February 14, 2011
Another attempt to certify home inspectors
Despite efforts for many years by several individuals and groups, the Canadian home inspection industry is still very much unregulated. British Columbia is the only province that has licensed practitioners, although three or four other jurisdictions are considering legislation.
In this unregulated sector, anyone can simply print some business cards, buy a flashlight and clipboard, and promote themselves as a home inspector. On top of that, some associations, training schools and even government agencies have convinced thousands of gullible people that a two-week course or even a short online quiz will qualify them to earn a high income inspecting houses for an even more unsuspecting public.
In 2006, the Canadian Association of Home and Property Inspectors (CAHPI) announced that after 10 years of meetings and hard work, they, along with CMHC, HRSDC, the Construction Sector Council and other industry partners, had successfully developed and implemented a national certification for Canadian home inspectors. The goal was to create a large group of well-trained, field-tested and qualified home inspectors on whom the public and others connected to a home purchasing transaction could rely. The program would be administered by a CAHPI ‘arms-length’ committee (National Certification Authority – NCA) that would process all inspectors fairly and objectively.
In the years since then, more than 500 inspectors have applied, had their backgrounds evaluated, been field tested and received their National Certification. However, the estimated number of home inspectors in Canada is between 5,000 and 6,000, so obviously the program has attracted only a very small percentage of the inspector population.
Since the program was created to bring some uniformity and credibility to the industry, the results were less than stellar – disappointing those who had seen the program as an opportunity to bring more legitimacy to the relatively new home inspection industry. It became apparent that since CAHPI’s membership accounted for only about 15 per cent of the total number of inspectors in the country, non-members were not comfortable that the NCA would process and test them objectively, despite CAHPI’s genuine assurances. As a result, applications for national certification slowed to a trickle in recent years.
In early 2010, in an effort to breathe new life into the certification program, and to address the concerns of the industry, a new, fully independent, non-partisan certification body was established, with representation from all existing associations but no affiliation with or obligations to any, including CAHPI.
The National Home Inspector Certification Council (NHICC) was incorporated and quickly received recognition, encouragement and support from government agencies, home inspection associations and other stakeholders. The NHICC is a certifying body only, and is not an association, so it is not seen by the associations as competing for members. Most organizations have their own ‘certifications’ that can be complemented by the National Certification. One national group, the Professional Home and Property Inspectors of Canada (PHPIC) based its Mission Statement on support for the NCP and they have actually adopted the NCP requirements as their own. The program also makes it possible for inspectors who choose to not be members of any association to be recognized and certified competent by an independent third party.
The NHICC has embraced the requirements of CAN-P-9 and has also applied for accreditation from two international accrediting organizations, the Institute of Credentialing Excellence (ICE) and the International Organization for Standardization (ISO). This will provide evidence that the program and the policies, procedures and governance of the NHICC are being true to the terms and the spirit of the original certification model.
Home inspectors can now take comfort knowing that their education and abilities will be compared uniformly and objectively by the NHICC to the National Occupational Standards for Canadian Home Inspectors. Consumers and others can be assured that despite the proliferation of pseudo-professional organizations and groups posing as legitimate professional home inspection associations, there is ONE national, strong and valid certification that exists to rigorously evaluate and test inspectors based on actual occupational standards that were developed through thousands of hours of study and debate.
With the National Certification Program now revived and welcoming applications, home inspectors can once again take advantage of a vehicle that will objectively verify their competence. Consumers and others can choose home inspectors from any association they wish, but they can enhance their chances of getting a competent inspector by looking for someone who is also a National Certificate Holder (NCH) as designated by the NHICC.
In this unregulated sector, anyone can simply print some business cards, buy a flashlight and clipboard, and promote themselves as a home inspector. On top of that, some associations, training schools and even government agencies have convinced thousands of gullible people that a two-week course or even a short online quiz will qualify them to earn a high income inspecting houses for an even more unsuspecting public.
In 2006, the Canadian Association of Home and Property Inspectors (CAHPI) announced that after 10 years of meetings and hard work, they, along with CMHC, HRSDC, the Construction Sector Council and other industry partners, had successfully developed and implemented a national certification for Canadian home inspectors. The goal was to create a large group of well-trained, field-tested and qualified home inspectors on whom the public and others connected to a home purchasing transaction could rely. The program would be administered by a CAHPI ‘arms-length’ committee (National Certification Authority – NCA) that would process all inspectors fairly and objectively.
In the years since then, more than 500 inspectors have applied, had their backgrounds evaluated, been field tested and received their National Certification. However, the estimated number of home inspectors in Canada is between 5,000 and 6,000, so obviously the program has attracted only a very small percentage of the inspector population.
Since the program was created to bring some uniformity and credibility to the industry, the results were less than stellar – disappointing those who had seen the program as an opportunity to bring more legitimacy to the relatively new home inspection industry. It became apparent that since CAHPI’s membership accounted for only about 15 per cent of the total number of inspectors in the country, non-members were not comfortable that the NCA would process and test them objectively, despite CAHPI’s genuine assurances. As a result, applications for national certification slowed to a trickle in recent years.
In early 2010, in an effort to breathe new life into the certification program, and to address the concerns of the industry, a new, fully independent, non-partisan certification body was established, with representation from all existing associations but no affiliation with or obligations to any, including CAHPI.
The National Home Inspector Certification Council (NHICC) was incorporated and quickly received recognition, encouragement and support from government agencies, home inspection associations and other stakeholders. The NHICC is a certifying body only, and is not an association, so it is not seen by the associations as competing for members. Most organizations have their own ‘certifications’ that can be complemented by the National Certification. One national group, the Professional Home and Property Inspectors of Canada (PHPIC) based its Mission Statement on support for the NCP and they have actually adopted the NCP requirements as their own. The program also makes it possible for inspectors who choose to not be members of any association to be recognized and certified competent by an independent third party.
The NHICC has embraced the requirements of CAN-P-9 and has also applied for accreditation from two international accrediting organizations, the Institute of Credentialing Excellence (ICE) and the International Organization for Standardization (ISO). This will provide evidence that the program and the policies, procedures and governance of the NHICC are being true to the terms and the spirit of the original certification model.
Home inspectors can now take comfort knowing that their education and abilities will be compared uniformly and objectively by the NHICC to the National Occupational Standards for Canadian Home Inspectors. Consumers and others can be assured that despite the proliferation of pseudo-professional organizations and groups posing as legitimate professional home inspection associations, there is ONE national, strong and valid certification that exists to rigorously evaluate and test inspectors based on actual occupational standards that were developed through thousands of hours of study and debate.
With the National Certification Program now revived and welcoming applications, home inspectors can once again take advantage of a vehicle that will objectively verify their competence. Consumers and others can choose home inspectors from any association they wish, but they can enhance their chances of getting a competent inspector by looking for someone who is also a National Certificate Holder (NCH) as designated by the NHICC.
REM online Feb 14, 2011 By Bill Mullen
Thursday, February 10, 2011
CREA Boosts Annual Resale Housing Forecast
The Canadian Real Estate Association (CREA) has revised its 2011 forecast for home sales activity via the Multiple Listing Service® (MLS®) Systems of Canadian real estate Boards and Associations, and extended it to 2012.
Sales in the second half of 2010 rebounded faster than CREA had previously expected. “The hand-off going into 2011, together with the highs and lows for sales activity posted in 2010, provided guidance for CREA’s revised forecast,” said Gregory Klump, CREA Chief Economist.
“Home buyers recognize that low mortgage interest rates represent a once in a lifetime opportunity. At the same time, they expect that rates will rise, so they’re doing their homework in order to understand what it could mean in terms of higher mortgage payments down the road before they make an offer,” said Georges Pahud, CREA President. “The housing market and buyer psychology is different now than it was at the beginning of last year, so buyers and sellers would do well to consult their REALTOR® to understand local market trends.”
The upward revision to CREA’s forecast for 2011 reflects recent improvements in the consensus economic outlook and a further expected improvement in consumer confidence. National sales activity is now expected to reach 439,900 units in 2011, representing an annual decline of 1.6 per cent. In 2012, CREA forecasts that national sales activity will rebound by three per cent to 453,300 units, which is roughly on par with the ten year average.
“Recent additional changes to mortgage regulations will further ensure that buyers don’t buy more home than they can afford when interest rates inevitably rise,” said Klump. “The announcement of the new changes to mortgage regulations will likely bring forward some sales into the first quarter that would have otherwise occurred later in the year, particularly in some of Canada’s more expensive housing markets. This is expected to produce a milder version of the volatility in sales activity that we saw last year which resulted from additional transitory factors.”
Three transitory factors contributed to volatility in sales activity last year: changes in mortgage regulations announced last February, the early withdrawal by the Bank of Canada of its conditional commitment to keep interest rates on hold until the second half of 2010, and the introduction of the HST in BC and Ontario during the summer of 2010.
CREA expects that home sales activity will gain traction after dipping in the second quarter as the economic recovery and job growth continue, incomes grow, and consumer confidence further improves. “Even though mortgage interest rates are expected to rise later this year, they will still be within short reach of current levels and remain supportive for housing market activity. Strengthening economic fundamentals will keep the housing market in balance, which will keep home prices stable,” said Klump.
The national average home price is forecast to rise 1.3 per cent in 2011 and 2012, to $343,300 and $347,900 respectively. Average price is expected to rise modestly in most provinces, reflecting the continuation of a healthy balance between supply of, and demand for, homes listed for sale. Although the supply of new listings is expected to trend higher, the expected continuation of sellers’ market conditions in Manitoba is forecast to result in a bigger percentage increase in average price in 2011 and 2012 compared to other provinces.
Copyright CREA reprinted with permission
Sales in the second half of 2010 rebounded faster than CREA had previously expected. “The hand-off going into 2011, together with the highs and lows for sales activity posted in 2010, provided guidance for CREA’s revised forecast,” said Gregory Klump, CREA Chief Economist.
“Home buyers recognize that low mortgage interest rates represent a once in a lifetime opportunity. At the same time, they expect that rates will rise, so they’re doing their homework in order to understand what it could mean in terms of higher mortgage payments down the road before they make an offer,” said Georges Pahud, CREA President. “The housing market and buyer psychology is different now than it was at the beginning of last year, so buyers and sellers would do well to consult their REALTOR® to understand local market trends.”
The upward revision to CREA’s forecast for 2011 reflects recent improvements in the consensus economic outlook and a further expected improvement in consumer confidence. National sales activity is now expected to reach 439,900 units in 2011, representing an annual decline of 1.6 per cent. In 2012, CREA forecasts that national sales activity will rebound by three per cent to 453,300 units, which is roughly on par with the ten year average.
“Recent additional changes to mortgage regulations will further ensure that buyers don’t buy more home than they can afford when interest rates inevitably rise,” said Klump. “The announcement of the new changes to mortgage regulations will likely bring forward some sales into the first quarter that would have otherwise occurred later in the year, particularly in some of Canada’s more expensive housing markets. This is expected to produce a milder version of the volatility in sales activity that we saw last year which resulted from additional transitory factors.”
Three transitory factors contributed to volatility in sales activity last year: changes in mortgage regulations announced last February, the early withdrawal by the Bank of Canada of its conditional commitment to keep interest rates on hold until the second half of 2010, and the introduction of the HST in BC and Ontario during the summer of 2010.
CREA expects that home sales activity will gain traction after dipping in the second quarter as the economic recovery and job growth continue, incomes grow, and consumer confidence further improves. “Even though mortgage interest rates are expected to rise later this year, they will still be within short reach of current levels and remain supportive for housing market activity. Strengthening economic fundamentals will keep the housing market in balance, which will keep home prices stable,” said Klump.
The national average home price is forecast to rise 1.3 per cent in 2011 and 2012, to $343,300 and $347,900 respectively. Average price is expected to rise modestly in most provinces, reflecting the continuation of a healthy balance between supply of, and demand for, homes listed for sale. Although the supply of new listings is expected to trend higher, the expected continuation of sellers’ market conditions in Manitoba is forecast to result in a bigger percentage increase in average price in 2011 and 2012 compared to other provinces.
Copyright CREA reprinted with permission
Tuesday, February 8, 2011
Now Is The Perfect Time To Buy
From an interest rate standpoint, now is a perfect time to become a homeowner. But transitioning from renter to homeowner is one of the biggest decisions you’ll make throughout your lifetime. It can also be a stressful experience if you don’t plan ahead by building a budget and saving prior to embarking upon homeownership.
Budgeting is a core ingredient that helps alleviate the stress associated with money issues that can sometimes arise if you purchase a home without knowing all of the associated costs – including down payment, closing expenses, ongoing maintenance, taxes and utilities.
The key is to create a realistic budget based on your goals. Track your spending and make your dollars go further by sticking to your budget once it’s in place. Budgeting offers a step-by-step formula for figuring out how to best save your hard-earned money to invest in homeownership.
Start by listing your household income, then your household expenses, and review your spending habits. All of this can be done on a pad of paper or on a computer spreadsheet.
Keeping receipts for everything that you purchase will enable you to accurately keep track of where your money is going each month so that you can review and make necessary changes to your plan.
Examine all areas of your life from entertainment to the type of food you buy, where you buy your food and clothes, and how and where you travel. Also look at your spending personality and make necessary adjustments. Are you a saver, a splurger, a spontaneous shopper or a hoarder? Become smarter with your money and avoid impulse buying.
If you find you’re spending a lot of money in one area, such as entertainment for instance, set aside a reasonable amount each month and prepare to stop spending money in this area once your budget has been exhausted.
Budgeting provides you with the opportunity to re-evaluate your needs and wants. If you can set your budget solidly in place before you head out home or mortgage shopping, you will be far more prepared to purchase your first home.
Following are three top tips to help you prepare for the purchase of your first home:
1. Set up a savings account. You can deposit a predetermined amount into this account each pay period that you will not touch unless it’s absolutely necessary. This will enable you to put money aside for a down payment and cover closing costs, as well as address ongoing homeownership expenses such as maintenance, taxes and utilities.
2. Save up for big-ticket items. As you accumulate money in your savings account, you will be able to also save for specific purchases to help furnish your home – avoiding the buy now, pay later mentality, which can have a negative impact on your credit when you’re seeking mortgage financing.
3. Surround yourself with a team of professionals. When you’re getting ready to make your first home purchase, work with your trusted real estate professional and find a licensed mortgage agent/broker. Experts are invaluable to you as you set out on the road to homeownership because we help first-time buyers through the home purchase and financing processes every day. Experts can answer all of your questions and set your mind at ease. Mortgage agents, for instance, have access to multiple lenders, and can help you get pre-approved for a mortgage so you know exactly what you can afford to spend on a home before you head out house hunting, while it’s our expertise that can match your needs with a house you can afford. Both parties will negotiate on your behalf to ensure you get the best bang for your buck. And, best of all, these services are typically free. We can also refer you to other reputable professionals you may need for your home purchase, including a real estate lawyer and home appraiser.
Budgeting is a core ingredient that helps alleviate the stress associated with money issues that can sometimes arise if you purchase a home without knowing all of the associated costs – including down payment, closing expenses, ongoing maintenance, taxes and utilities.
The key is to create a realistic budget based on your goals. Track your spending and make your dollars go further by sticking to your budget once it’s in place. Budgeting offers a step-by-step formula for figuring out how to best save your hard-earned money to invest in homeownership.
Start by listing your household income, then your household expenses, and review your spending habits. All of this can be done on a pad of paper or on a computer spreadsheet.
Keeping receipts for everything that you purchase will enable you to accurately keep track of where your money is going each month so that you can review and make necessary changes to your plan.
Examine all areas of your life from entertainment to the type of food you buy, where you buy your food and clothes, and how and where you travel. Also look at your spending personality and make necessary adjustments. Are you a saver, a splurger, a spontaneous shopper or a hoarder? Become smarter with your money and avoid impulse buying.
If you find you’re spending a lot of money in one area, such as entertainment for instance, set aside a reasonable amount each month and prepare to stop spending money in this area once your budget has been exhausted.
Budgeting provides you with the opportunity to re-evaluate your needs and wants. If you can set your budget solidly in place before you head out home or mortgage shopping, you will be far more prepared to purchase your first home.
Following are three top tips to help you prepare for the purchase of your first home:
1. Set up a savings account. You can deposit a predetermined amount into this account each pay period that you will not touch unless it’s absolutely necessary. This will enable you to put money aside for a down payment and cover closing costs, as well as address ongoing homeownership expenses such as maintenance, taxes and utilities.
2. Save up for big-ticket items. As you accumulate money in your savings account, you will be able to also save for specific purchases to help furnish your home – avoiding the buy now, pay later mentality, which can have a negative impact on your credit when you’re seeking mortgage financing.
3. Surround yourself with a team of professionals. When you’re getting ready to make your first home purchase, work with your trusted real estate professional and find a licensed mortgage agent/broker. Experts are invaluable to you as you set out on the road to homeownership because we help first-time buyers through the home purchase and financing processes every day. Experts can answer all of your questions and set your mind at ease. Mortgage agents, for instance, have access to multiple lenders, and can help you get pre-approved for a mortgage so you know exactly what you can afford to spend on a home before you head out house hunting, while it’s our expertise that can match your needs with a house you can afford. Both parties will negotiate on your behalf to ensure you get the best bang for your buck. And, best of all, these services are typically free. We can also refer you to other reputable professionals you may need for your home purchase, including a real estate lawyer and home appraiser.
Examining the New Mortgage Rules
On January 17th, Finance Minister Jim Flaherty announced adjustments to the rules for government-backed insured mortgages that will come into force March 18th, 2011.
The new measures will:
• Reduce the maximum amortization period to 30 years from 35 years for new government-backed insured mortgages with loan-to-value (LTV) ratios greater than 80%
• Lower the maximum amount Canadians can borrow in refinancing their mortgages to 85% from 90% of the value of their homes
Additionally, on April 18th, 2011, the government will withdraw its insurance backing on lines of credit secured by homes, such as home equity lines of credit (HELOCs).
By paring back the maximum amortization from 35 years to 30, qualification will become harder for some borrowers – particularly first-time homeowners – as mortgage payments will increase. It’s hard to imagine that, not so long ago, Canadians could amortize their mortgages up to 40 years with zero down payment mortgages.
This is the second time in less than a year that the refinancing maximum was reduced – meaning Canadians can access less of their home equity. The first reduction from 95% of the value of your home to 90% came into force in April 2010. Now, as of March 18th, 2011, the second reduction will bring maximum refinance levels down to 85%.
This change will mean that fewer borrowers can consolidate high-interest debt such as credit cards and other unsecured loans into their mortgage at today’s low rates. This may force homeowners who are experiencing job loss, illness, separation, divorce or urgent unforeseen family crisis into having to sell their homes to gain access to their very own equity.
With these two reductions in the maximum refinance amount (totalling 10%) in less than a year, on a $300,000 home, that’s a difference of $30,000 homeowners can no longer access.
With interest rates sitting at all-time lows – with nowhere to go but up – and looming mortgage rule changes, now is the perfect time to purchase a new home, or refinance your mortgage to pay off bills or free up more cash flow.
Now more than ever it’s important for Canadians to practice financial responsibility, as options for reducing high-interest debt payments are increasingly being limited.
The new measures will:
• Reduce the maximum amortization period to 30 years from 35 years for new government-backed insured mortgages with loan-to-value (LTV) ratios greater than 80%
• Lower the maximum amount Canadians can borrow in refinancing their mortgages to 85% from 90% of the value of their homes
Additionally, on April 18th, 2011, the government will withdraw its insurance backing on lines of credit secured by homes, such as home equity lines of credit (HELOCs).
By paring back the maximum amortization from 35 years to 30, qualification will become harder for some borrowers – particularly first-time homeowners – as mortgage payments will increase. It’s hard to imagine that, not so long ago, Canadians could amortize their mortgages up to 40 years with zero down payment mortgages.
This is the second time in less than a year that the refinancing maximum was reduced – meaning Canadians can access less of their home equity. The first reduction from 95% of the value of your home to 90% came into force in April 2010. Now, as of March 18th, 2011, the second reduction will bring maximum refinance levels down to 85%.
This change will mean that fewer borrowers can consolidate high-interest debt such as credit cards and other unsecured loans into their mortgage at today’s low rates. This may force homeowners who are experiencing job loss, illness, separation, divorce or urgent unforeseen family crisis into having to sell their homes to gain access to their very own equity.
With these two reductions in the maximum refinance amount (totalling 10%) in less than a year, on a $300,000 home, that’s a difference of $30,000 homeowners can no longer access.
With interest rates sitting at all-time lows – with nowhere to go but up – and looming mortgage rule changes, now is the perfect time to purchase a new home, or refinance your mortgage to pay off bills or free up more cash flow.
Now more than ever it’s important for Canadians to practice financial responsibility, as options for reducing high-interest debt payments are increasingly being limited.
Record Home Prices for 2010
Vancouver, BC – January 13, 2011. The British Columbia Real Estate Association (BCREA) reports that Multiple Listing Service® (MLS®) residential sales in the province declined 12 per cent to 74,640 units in 2010. The annual average MLS® residential price rose 8.5 per cent to a record $505,178 in 2010.
“Tighter credit conditions and expended pent-up demand curbed home sales during the first half of 2010,” said Cameron Muir, BCREA Chief Economist. “However, low mortgage interest rates and improved economic conditions buoyed home sales in the latter half of the year.” MLS® residential unit sales declined 40 per cent January through July before climbing 43 per cent by the end of the year, on a seasonally adjusted basis.
“The inventory of homes for sale peaked at 53,375 units in May before declining 14 per cent to 46,000 units by December,” added Muir. “The combination of fewer active listings and increased consumer demand has improved market conditions in many areas.”
MLS® residential sales declined 25 per cent to 4,258 units in December from a near record level of 5,703 units in December 2009. After a 15 per cent increase in unit sales between October and November, a further 1 per cent increase was recorded in December on a seasonally adjusted basis. The average MLS® residential sales price was a record $523,990 in December, up 6 per cent from December 2009.
Copyright BCREA reprinted with permission
“Tighter credit conditions and expended pent-up demand curbed home sales during the first half of 2010,” said Cameron Muir, BCREA Chief Economist. “However, low mortgage interest rates and improved economic conditions buoyed home sales in the latter half of the year.” MLS® residential unit sales declined 40 per cent January through July before climbing 43 per cent by the end of the year, on a seasonally adjusted basis.
“The inventory of homes for sale peaked at 53,375 units in May before declining 14 per cent to 46,000 units by December,” added Muir. “The combination of fewer active listings and increased consumer demand has improved market conditions in many areas.”
MLS® residential sales declined 25 per cent to 4,258 units in December from a near record level of 5,703 units in December 2009. After a 15 per cent increase in unit sales between October and November, a further 1 per cent increase was recorded in December on a seasonally adjusted basis. The average MLS® residential sales price was a record $523,990 in December, up 6 per cent from December 2009.
Copyright BCREA reprinted with permission
Changes to Mortgage Rules and Regulations
The Government announced three changes to the standards governing government-backed insured mortgages.
LIMIT THE MAXIMUM AMORTIZATION PERIOD TO 30 YEARS
The amortization period is the length of time it will take to pay off the entire mortgage loan. It is usually much longer than the term of the mortgage. A typical mortgage in Canada may have a term of five years or less during which a specific fixed or variable interest rate will apply, and the mortgage can be renewed at the end of the term.
The measure announced today will reduce the maximum amortization period from 35 years to 30 years. For any given mortgage loan, a lower amortization period would result in a moderate increase in the monthly payment along with a significant reduction in the total interest paid over the amortization period. This measure is consistent with the principle of encouraging savings through home ownership.
According to the Canadian Real Estate Association, the national average price (based on Multiple Listing Service sales activity) for a home sold in November 2010 was $344,268.
LOWER THE MAXIMUM REFINANCING AMOUNT TO 85 PER CENT OF THE LOAN-TO-VALUE RATIO
Borrowers can refinance their mortgage and increase the amount of the loan secured against their home. The measure announced today will reduce the limit on refinancing from 90 per cent to 85 per cent of the value of the home. Refinancing lowers the borrower’s equity in their home. Reducing the maximum loan-to-value ratio on refinancing will encourage Canadians to keep equity in their home and save through home ownership.
As an illustration, for a home valued at $300,000, refinancing at 90 per cent would allow the homeowner to access up to $270,000, whereas refinancing at 85 per cent would allow the homeowner to access up to $255,000. The lower refinancing limit means homeowners will keep an additional $15,000 in the equity of their home.
WITHDRAW GOVERNMENT INSURANCE BACKING ON NON-AMORTIZING LINES OF CREDIT SECURED BY HOMES
Under the current rules, a line of credit secured by the borrower’s home, such as a home equity line of credit, is limited to a maximum of 80 per cent of the value of the home. There has been a substantial increase in the credit available to Canadians through this type of secured line of credit over the past several years, and it is an important factor in the rise in overall household debt. These loans are generally non-amortizing, which means that borrowers are not required to make regular payments on the principal amount of the loan. Moreover, these loans are almost exclusively variable rate products, which expose borrowers to the impact of rising interest rates. While regulated lenders are not required to obtain insurance on lines of credit secured by homes at the time of origination, they may choose to obtain insurance after origination through what is known as “portfolio insurance,” where secured lines of credit are pooled into a portfolio and then insured by a mortgage insurer. At the time of insurance, the benefit of the portfolio insurance is to the lender by facilitating funding, rather than to the individual borrower. Other options exist for lenders to fund their secured lines of credit.
Many lenders now offer multiple loans or a multi-segment loan secured against a borrower’s home. If a loan or a segment of a multi-segment loan is in the form of a revolving line of credit that does not amortize over time, it will no longer be eligible for government-backed insurance. However, with established scheduled principal and interest payments, a loan will continue to be eligible for government-backed insurance, provided it meets the underwriting standards set by the mortgage insurer.
Withdrawing government insurance backing on these non-amortizing products is consistent with the Government’s objective of supporting the long-term stability of Canada’s housing market.
MOVING TO THE NEW FRAMEWORK
The adjustments to the maximum amortization period and the maximum refinancing amount will come into force on March 18, 2011. The withdrawal of government insurance backing on lines of credit secured by homes will come into force on April 18, 2011. Exceptions would be allowed after the new measures come into force where they are needed to satisfy a binding purchase and sale, financing or refinancing agreement entered into before the corresponding coming into force dates.
LIMIT THE MAXIMUM AMORTIZATION PERIOD TO 30 YEARS
The amortization period is the length of time it will take to pay off the entire mortgage loan. It is usually much longer than the term of the mortgage. A typical mortgage in Canada may have a term of five years or less during which a specific fixed or variable interest rate will apply, and the mortgage can be renewed at the end of the term.
The measure announced today will reduce the maximum amortization period from 35 years to 30 years. For any given mortgage loan, a lower amortization period would result in a moderate increase in the monthly payment along with a significant reduction in the total interest paid over the amortization period. This measure is consistent with the principle of encouraging savings through home ownership.
According to the Canadian Real Estate Association, the national average price (based on Multiple Listing Service sales activity) for a home sold in November 2010 was $344,268.
LOWER THE MAXIMUM REFINANCING AMOUNT TO 85 PER CENT OF THE LOAN-TO-VALUE RATIO
Borrowers can refinance their mortgage and increase the amount of the loan secured against their home. The measure announced today will reduce the limit on refinancing from 90 per cent to 85 per cent of the value of the home. Refinancing lowers the borrower’s equity in their home. Reducing the maximum loan-to-value ratio on refinancing will encourage Canadians to keep equity in their home and save through home ownership.
As an illustration, for a home valued at $300,000, refinancing at 90 per cent would allow the homeowner to access up to $270,000, whereas refinancing at 85 per cent would allow the homeowner to access up to $255,000. The lower refinancing limit means homeowners will keep an additional $15,000 in the equity of their home.
WITHDRAW GOVERNMENT INSURANCE BACKING ON NON-AMORTIZING LINES OF CREDIT SECURED BY HOMES
Under the current rules, a line of credit secured by the borrower’s home, such as a home equity line of credit, is limited to a maximum of 80 per cent of the value of the home. There has been a substantial increase in the credit available to Canadians through this type of secured line of credit over the past several years, and it is an important factor in the rise in overall household debt. These loans are generally non-amortizing, which means that borrowers are not required to make regular payments on the principal amount of the loan. Moreover, these loans are almost exclusively variable rate products, which expose borrowers to the impact of rising interest rates. While regulated lenders are not required to obtain insurance on lines of credit secured by homes at the time of origination, they may choose to obtain insurance after origination through what is known as “portfolio insurance,” where secured lines of credit are pooled into a portfolio and then insured by a mortgage insurer. At the time of insurance, the benefit of the portfolio insurance is to the lender by facilitating funding, rather than to the individual borrower. Other options exist for lenders to fund their secured lines of credit.
Many lenders now offer multiple loans or a multi-segment loan secured against a borrower’s home. If a loan or a segment of a multi-segment loan is in the form of a revolving line of credit that does not amortize over time, it will no longer be eligible for government-backed insurance. However, with established scheduled principal and interest payments, a loan will continue to be eligible for government-backed insurance, provided it meets the underwriting standards set by the mortgage insurer.
Withdrawing government insurance backing on these non-amortizing products is consistent with the Government’s objective of supporting the long-term stability of Canada’s housing market.
MOVING TO THE NEW FRAMEWORK
The adjustments to the maximum amortization period and the maximum refinancing amount will come into force on March 18, 2011. The withdrawal of government insurance backing on lines of credit secured by homes will come into force on April 18, 2011. Exceptions would be allowed after the new measures come into force where they are needed to satisfy a binding purchase and sale, financing or refinancing agreement entered into before the corresponding coming into force dates.
MORTGAGE INSURANCE
Mortgage insurance (which is sometimes called mortgage default insurance) is a credit risk management tool that protects lenders from losses on mortgage loans. If a borrower defaults on a mortgage, and the proceeds from the foreclosure of the property are insufficient to cover the resulting loss, the lender submits a claim to the mortgage insurer to recover its losses.
The law requires federally regulated lenders to obtain mortgage insurance on loans in which the homebuyer has made a down payment of less than 20 per cent of the purchase price (also called high loan-to-value loans). The homebuyer pays the premiums for this insurance, which protects the lender if the homebuyer defaults.
The Government backs insured mortgages in Canada. It is responsible for the obligations of Canada Mortgage and Housing Corporation (CMHC) as it is an agent Crown corporation. In order for private mortgage insurers to compete with CMHC, the Government backs private mortgage insurers’ obligations to lenders, subject to a deductible equal to 10 per cent of the original principal amount of the loan.
In October 2008, the Government adjusted its minimum standards for the mortgage insurance guarantee framework, including:
• Fixing the maximum amortization period for new government-backed insured mortgages to 35 years.
• Requiring a minimum down payment of five per cent for new government-backed insured mortgages.
• Establishing a consistent minimum credit score requirement.
• Requiring the lender to make a reasonable effort to verify that the borrower can afford the loan payment.
• Introducing new loan documentation standards to ensure that there is evidence of reasonableness of property value and the borrower’s sources and level of income.
In April 2010, the Government took additional measured steps to support the long-term stability of Canada’s housing market and continue to encourage home ownership for Canadians. Adjustments to the mortgage insurance guarantee framework included:
• Requiring that borrowers meet the standards for a five-year fixed rate mortgage even if they choose a mortgage with a lower interest rate and shorter term.
• Lowering the maximum amount Canadians can withdraw in refinancing their mortgages to 90 per cent from 95 per cent of the value of their homes.
• Requiring a minimum down payment of 20 per cent on non-owner-occupied properties purchased for speculation.
The law requires federally regulated lenders to obtain mortgage insurance on loans in which the homebuyer has made a down payment of less than 20 per cent of the purchase price (also called high loan-to-value loans). The homebuyer pays the premiums for this insurance, which protects the lender if the homebuyer defaults.
The Government backs insured mortgages in Canada. It is responsible for the obligations of Canada Mortgage and Housing Corporation (CMHC) as it is an agent Crown corporation. In order for private mortgage insurers to compete with CMHC, the Government backs private mortgage insurers’ obligations to lenders, subject to a deductible equal to 10 per cent of the original principal amount of the loan.
In October 2008, the Government adjusted its minimum standards for the mortgage insurance guarantee framework, including:
• Fixing the maximum amortization period for new government-backed insured mortgages to 35 years.
• Requiring a minimum down payment of five per cent for new government-backed insured mortgages.
• Establishing a consistent minimum credit score requirement.
• Requiring the lender to make a reasonable effort to verify that the borrower can afford the loan payment.
• Introducing new loan documentation standards to ensure that there is evidence of reasonableness of property value and the borrower’s sources and level of income.
In April 2010, the Government took additional measured steps to support the long-term stability of Canada’s housing market and continue to encourage home ownership for Canadians. Adjustments to the mortgage insurance guarantee framework included:
• Requiring that borrowers meet the standards for a five-year fixed rate mortgage even if they choose a mortgage with a lower interest rate and shorter term.
• Lowering the maximum amount Canadians can withdraw in refinancing their mortgages to 90 per cent from 95 per cent of the value of their homes.
• Requiring a minimum down payment of 20 per cent on non-owner-occupied properties purchased for speculation.
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