What kind of down payment do I need to buy a home?

Ask the Pros Question of the Week: What kind of down payment do I need to buy a home?

Answer:

You need at least 5%, but you're in a much better position if you can put down 20%.

Remember that a deposit is different from down payment. The deposit accompanies the offer (and this is negotiable - but 5% is a great number). The downpayment is the amount you put down on the house pre-mortgage. It includes your deposit money.

See more Answers to this question.

Home Inspections

by Robert Wright

I again have been asked to look at a home that has been recently purchased. The thought the family had was to buy a home that needed some work and then improve it to suit them. Many people do this and they rely on the home inspector to guide them on this major purchase. I won’t be asked to inspect a home before a purchase.

What has happened is that now that the family is in the home, problems are showing up. Like most families after they move into their new (to them) home, they don’t have a large amount of cash for additional repairs or if issues arise. The added problem in this case is that the health of the family is being affected by the home.

They did what they should have; they walked through the home with the inspector and discussed various issues. However, the issues raised by the home buyer were not considered of great importance to the inspector. The problem is that these issues might indicate additional problems, which could be of major concern. The next issue is that the costs suggested by the inspector and/or real estate agent for repairs in no way reflected the reality of the actual repair costs. So while they bought the home at less than listing price, the less than anticipated purchase price did not leave them enough to cover the cost of the repairs and issues that are now apparent, due to neglect by the previous home owner.

In addition, I noted other problems that were missed by the inspector. The only saving grace – maybe – for the homeowner is that a form was signed by the previous home owner, which indicates that all work done on the home was done with permits. A lot of work was done that would not pass inspection and was clearly done by non-professional trades.

Does the real estate industry in general work in the interest of the home buyer? All the agents, inspectors, and lawyers have a vested interest in the sale proceeding. While they all may not get paid by the home sale like the agents, they may rely on the referrals and/or repeat business from the agents. So everyone involved may not want to seriously rock the boat when you are planning on purchasing a home – the deal puts food on their tables. So what can you do when planning your next home purchase?

First understand how the system is set up. Next, look for some independent help. While I will not do or be asked to do a home inspection, I have been asked for my opinion on issues and thoughts on the work being considered for a home to be purchased. So look for a renovation contractor to help you confirm if issues you see are major or not. You may also want to hire trade contractors to look at things like the plumbing, HVAC, and electrical systems. Ensure that your real estate agent works for you when purchasing a new home and keep looking for the home that is right for you.

When I look at home, I have a very good idea what the problems are and what it would take to fix them. Do you? When you are planning the biggest purchase in your life, take some time and really understand what you are buying.

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About the Author

Rob Wright has grown up around construction and in the mid 1990’s, Rob joined and took over Citadel Renovations in Ottawa. Rob has presented seminars at the local home shows on various renovations subjects and is a contributor to the Home Renovation Guide. Rob has been active in the Greater Ottawa Home Builders Association for many years and previously served as the Renovation Council Chair. For more information, visit CitadelRenovations.com.

5 Things A Buyer Should Have Before Making An Offer

by Teri Conrad

You’ve been flirting with upgrading for a while now. You keep driving around the neighborhood and it's perfect. You’ve spotted a few properties with ‘For Sale’ signs and you may even have called ‘just to see’ what their asking price is. You go home…crunch a few numbers and you say to yourself “You know what, I think we can afford it!”

So now what? Well I’m hoping by now you know to give your Realtor a call! Remembering that the Listing Realtor’s first interest is the Seller….you need someone investigating and negotiating on your behalf, and protecting YOUR interests (but that’s another blog post!)

There are a few things you need to have ready to go before you fall in love with the house of your dreams.

1. Deposit
Whenever you make an offer on a property, there is always a ‘cash upfront’ deposit required (usually 5% of the agreed price) written directly into the contract and held in trust with the listing brokerage. It will be released upon completion and be put toward the purchase, but you must have access to this money upfront. Don’t count on it being a part of your mortgage. (One thing to remember – if you have more than 20% you can avoid paying CMHC insurance!)

2. Pre-Approval from a Mortgage Broker
Visiting a Mortgage Broker before you start shopping is the smartest thing you can do. You may think you can afford the house, but the lender may not. They will weigh your income against all of your other monthly debt (debt service ratio). They will also look at your Beacon Score which measures how well you stay on top of your debt…do you pay your bills on time? Etc. The better your score ~ the more you may qualify for. Your Mortgage Broker can help position you to be in the right place when you’re ready to qualify.

When you visit your Mortgage bring:

* A letter from your employer confirming your employment and current wage

* If you’re self employed – 2 years of tax assessments indicating income

* Social Insurance Number

3. Have A Lawyer
Often times, in the middle of negotiations, your Realtor will advise that you show the offer to your Lawyer. It really is prudent to have one ready to go and to follow your Realtor’s advice.

4. Remember additional costs
In British Columbia we have a few fun ones: We have PTT is the big one! (Property Transfer Tax – 1% on the first $200,000 and additional 2% on the balance) as well as HST (Harmonized Sales Tax =12%) on new development only, however, there is a partial rebate on new homes up to $425,000.00. Please discuss all costs with your Mortgage Broker.

5. Property Inspector
Remember ~ when we’ve written an offer and we have 5 business days to remove subjects, you don’t want to put off making an appointment early with your Property Inspector. I appreciate that a Property Inspector can be an additional $500 (appx) cost and what if you discover something and decide not to proceed with the purchase? It does happen. However, just think of what the costs MIGHT have been. Also please consider that most homes have some wear and tear. The Property Inspection is to discover any MAJOR immediate problems with the property. It is not meant to be a negotiating tool after you’ve agreed on a price. If there is a substantial problem, then yes we may want to open up the contract and re-negotiate, but that’s only after a discovery of something REALLY wrong.

Stress Free Buying

Having all ‘Your Ducks In a Row’ will allow for less stress and a smoother transition during the Buying Process. Check with your Realtor, he/she will likely have referrals for you and save you the search.

About the Author

A modern Realtor® for 4 years, Teri is passionate about and embracing Web 2.0, utilizing online marketing initiatives and social media to maximize exposure and sell properties! She earned a diploma in Radio Communications from British Columbia Institute of Technology (BCIT) which positioned her well with the knowledge and experience to anticipate the new media and new technology world. Teri's background is in marketing and selling radio advertising for Rogers Communications Inc.

Teri founded the Fraser Valley Social Media Meetups  to share her knowledge and facilitate learning and networking in her community of Langley, BC, as well as sits on the Communications and membership committees of the Langley Chamber of Commerce. Teri also consults with clients who need guidance with their social media strategy and content management. Most recently, Teri was asked to speak at Inman's Agent Reboot Conference in Seattle and Portland. Known as @TLCHOME on Twitter… Teri is happily married and has 2 great sons and a step daughter.

Get the straight goods on mortgages

Taking out a mortgage is a big financial commitment — probably one of the biggest you’ll ever make. From deciding whether to go with a fixed or variable rate, to determining how long you’ll need to pay off your mortgage, to figuring out how much you can afford to borrow and how much money you’ll need to buy and maintain your home, there are many factors to consider.

"Researching the choices available can make a huge difference in the amount of money consumers will pay in interest and other charges. There are so many options for consumers, including the type of lender, and the size and frequency of payments, that it can be overwhelming,” according to Ursula Menke, Commissioner of the Financial Consumer Agency of Canada (FCAC).

FCAC offers free mortgage material, including publications, tip sheets, video testimonials and two online interactive tools — The Mortgage Qualifier Tool and Mortgage Calculator that can be found online at moneytools.ca. There’s also information on areas you may not have considered: how to pay off your mortgage faster, how to borrow on your home equity and what to consider when renewing and renegotiating your mortgage.

This article was provided by the Financial Consumer Agency of Canada (FCAC). The FCAC protects the rights of consumers and informs them about financial products and services. It was established in 2001 by the federal government to strengthen supervision of the financial industry and expand consumer education in the financial sector. More information is available on our website: fcac.gc.ca.

Home Buyers Holiday Wish List

With the holidays fast approaching, it’s time to start thinking about what you want this year. For some it may be an iPad or Xbox, while others may have a much larger gift in mind - a new home. So, grab a pen and paper, put up that stocking and fill it with your home buying wish list because Baby, it’s cold outside.

WISH #1: A 20% Down Payment
The average home buyer puts down 5-20% of the mortgage value for a down payment but if you can manage to increase this figure to 20% or more, you can save a lot of money. With a down payment of 20% or more, you can avoid paying mortgage default insurance (commonly referred to as ‘CMHC insurance’), due at the time of purchase and sometimes secure a more favourable mortgage rate and rate terms. In terms of long-term savings, a larger down payment reduces the amount of your monthly principal and interest payment and the total amount of interest you pay on the whole.

So, how will you source this money? Well, first look at more common sources such as saving a fixed amount from every pay-cheque, selling any stocks or bonds or personal property or reaching out to friends and family, for example. Another great option is the RRSP Home Buyers' Plan (HBP) which lets first-time home buyers withdraw up to $25,000 from Registered Retirement Savings Plans (RRSPs) for a home purchase, tax-free. Many first-time home buyers take advantage of this opportunity and set up RRSP accounts well in advance of purchasing, with the intention to reap the rewards at a later time when they buy their first home.

Wish #2: A Flexible Mortgage
Another way to save money over the life of your mortgage is to select a mortgage with favourable prepayment options. Prepayment options outline the flexibility you have to increase your monthly mortgage payments or pay off your mortgage as a whole. A monthly prepayment provision is a percentage increase allowance on your original monthly mortgage payment, while a lump sum provision allows you to pay off part of your mortgage principal. For example, if your monthly mortgage payment is $1,000 and your monthly prepayment allowance is 25%, then you can increase your payments to $1,250. The lump sum prepayment option on the other hand, applies to the mortgage as a whole. So, a 25% lump sum prepayment privilege would allow you pay off a mortgage completely in four years.

You may gain access to cash flow you did not expect throughout the term of your mortgage in the form of a salary increase, bonus or inheritance. Such cash flow influxes are not uncommon; therefore, you may want to consider putting this money towards your mortgage as it will reduce the amount of interest you will pay over the life of the mortgage.

Wish #3: The Lowest Mortgage Rate
With mortgage rates at historical lows, it’s a great time to buy a home. Your search for the lowest mortgage rate begins by selecting the type of rate you want. Though variable mortgage rates have proven to be less expensive when examined historically, the majority of Canadians still opt for fixed mortgage interest rates. This can be partly attributed to a general aversion to interest rate uncertainty and the financial burden associated with fluctuating mortgage payments.

When comparing mortgage rates it is also important that you ‘shop around’. Look at both bank mortgage rates and those of mortgage brokers. Although banks are able to consolidate your services, brokers are often able to offer lower rates because they can access multiple lenders and pass on volume discounts.

So compare competitive mortgage rates, work on getting that down payment and you’ll be well on your way to a new home for the new year.



This article was provided by RateHub.ca, an independent, impartial mortgage rate comparison platform. We bring the most competitive mortgage rates to one place, so you can make informed and efficient decisions. We believe that finding the best mortgage rate should be straight-forward, and our website has been designed with that in mind. RateHub works with the top mortgage brokers and lenders in Canada to bring you the most competitive mortgage rates. We update our rates on a daily basis with accurate, real-time data. We also provide ongoing mortgage education and resources to assist you in your selection process.

Real Estate News Round Up: Week of Dec 6th

Image from http://miamibeachluxuryrealestate.blogspot.com

Oh dear, this week in real estate news it looks like the general theme is that prices are going up next year.

According to Re/Max, 2011 will see the average Canadian housing price go up to $350,000; a 3% increase by the end of next year as reported this Canadian Business article. 

This is evidenced in the price of real estate in Ottawa, which according to a new report rose to an all new high this year and will continue going up next year. A modest rise in prices is predicted for Toronto in 2011, at the pace of inflation.

In Calgary, housing starts in November were 33% lower compared to a year ago according to the Herald. However the increase in housing starts in Ontario was more than enough to offset declines in other parts of the nation. Economists are also predicting a brighter outlook for the real estate market within the GTA. And citing positive moves by the Bank of Canada, according to the British Columbia Real Estate Association, the one-year fixed mortgage rate is going to increase in 2011.

But are all these reports based on price averages truly reflective of the health of the national housing market? The Canadian Real Estate Association is looking into changing its existing system of assessing the status of the Canadian housing market.

In other assessment changes, it looks like value properties in Ontario may be out-dated and homeowners may be facing a rise in taxes or a decrease (ya right).  As the Canadian public continues to keep their heads afloat from the hangover of recent industry trials and tribulations, it looks like mortgage brokers are seeing a boon as the need for services are increasing and changing; here are 7 trends outlined in a recent report by Deloitte.

Now let's for a moment forget that prices are going up next year. In case any of you were wondering, here's a look at LeBron James' new 9 million+ Miami property. Just imagine what property taxes are for this little beauty.

Which is a better neighbourhood for buying a new condo for investment?

image from http://www.freecondoguide.com

Ask the Pros Question of the Week: Which is a better neighbourhood for buying a new condo for investment? Liberty Village or LeslieVille?


Answer:

A: Both Leslieville and Liberty are newer up-and-coming areas, successful developments of older industrial areas into hipper residential neighbourhoods. At least for now, the condo choices are probably wider in Liberty, while freehold choices are possibly better in Leslieville. Someone else might give me an argument here. Possibly the bigger question is whether a condo is a great "investment" at this point in the market cycle.

In a recent Globe and Mail article, three well-qualified analysts stated that 1) a serious double-dip recession was likely and necessary; 2) a double-dip recession was possible but should be fought by increased public spending; and 3) it isn't going to happen at all, the recovery is started.

If you buy 1) or 2), you might want to wait for a bit of a correction. Condo markets tend to move (in both directions) faster and sharper than the overall market.

See more Answers to this question.

Renovations that Sell

by Kenneth Ho

Thinking of selling your home and not sure about what to make the most from your sale? Potential home buyers are often searching for properties that are in “move-in ready” condition so that they don’t have to incur any extra costs when they move into their new home.

If you already own a home suitable for you and your family, renovating with long-term sell-ability means that you will enjoy a better living atmosphere for a longer period of time and will get a handsome return for your investment. The prolonged usage you also get out of the renovation maximizes your investment gain.

We have selected three types of renovation that will give you the biggest return for your investment wile making dramatic improvements to your property:

Kitchen

The kitchen has always been the heart of a home, where everyone gathers and chats about what’s new in their lives. It is also the busiest room in the house as we prepare and eat at least two meals there. That’s why it’s the first room that potential buyers look at when they walk into a property listed for sale. As a result, the kitchen is considered to be a significant marketing tool.

Here, it is important for sellers to emphasis spaciousness, functionality, clutter-free, and effective storage in a kitchen space. Hiring a design professional to design the kitchen is ideal, as they often are able to come up with innovative design solutions as well as finding and specifying the proper materials to highlight the architecture of your house, making your kitchen look more appealing to the potential buyers. In most cases, a kitchen with granite countertops would be a fast seller because it creates richness, elegance, and emphasizes quality. Besides the marketing advantage, granite countertop is also ideal for daily personal use because of its resistance to scratches, natural look and ease of maintenance. You should never try to save money on design, appliances, or labour because these are the basis of a spectacular space. Remember, having the job done well is a value adder; doing it poorly may reduce the value of your home!

According to the Appraisal Institute of Canada, the average amount that you should spend prior to selling your house should be 10-15% of the house value. If you are planning on renovating the kitchen for personal use and not only for the purpose of investment, and if you are going to live in your house for more than five years, then you should spend 15 - 25% or more. In most cases, you will be able to recover the cost of the renovation by the time you sell your house – with a 44% higher return on investment than the average return on other popular renovations!

Bathroom

After the kitchen, bathrooms are the next rooms that buyers look at. To impress a potential buyer, your bathroom should not only feel new, but also look sharp. Usually a bathroom renovation involves the complete replacement of existing finish and fixtures – tubs/showers, toilets, faucets, sinks, tiles, flooring, lightings, cabinetry, and tile-work. Sometimes bathroom renovation also involves the re-location of fixtures and the removal of adjacent walls to create a better layout. A common renovation trend has been enlarging a master or en-suite bathroom into an adjacent closet or laundry room to create space for a large soaker tub and separate stand-up shower. Twin sinks and extensive cabinetry can also offer added conveniences.

A study from Canada’s leading real estate companies shows that a well-designed bathroom renovation will generate a 56% better return on investment than the average popular renovation. The study also shows that most home buyers are looking for spa-like bathrooms with a comfortable environment at first glance. Light colours, rich textures, luxuries such as water jets in the tub and a steam shower stall can emphasize the relaxed atmosphere in the bathroom.

Floor and Wall Finishes

Don’t undervalue the paint and flooring in your home! Walking into any room of a house, the walls and floors are the first surfaces that a person sees; therefore materiality is very important in order to make a strong first impression.

Walls should be smooth and painted in a colour that isn’t too much of a personal preference. A light and warm neutral colour usually works best to both enlarge the look of a space, but also create a warm and desirable ambiance. Simply repainting your walls will give you a 29% better return than other popular renovations.

Flooring should create a good flow between one room to the next and be able to tie in with other elements such as cabinetry, wall colours, and baseboards. Choosing the right floor finish is important as it ties all the individual element of your home together. Always consult a design professional before changing your floor unless you are certain of what you want, as flooring is often difficult and expensive to change.

Based on studies, flooring can generate a 22% better return on investment than the average renovations. If your home has carpet where the family room, dining room and living room are located, it is recommended to have all the carpets changed to hardwood and/or tiles. Not only will it make your home more elegant, but you will also enjoy the benefits of a healthier indoor environment, with less allergens.

Besides the above-mentioned, there are also other types of value-adding renovations that could help in selling you house. Before making any decisions, you should always consider the length of time that you will stay in your house before selling, and consult a design professional for the proper design solutions that suits your needs. Planning ahead in detail always saves you time and money.

This article was provided by BiglarKinyan Design Partnership. Kenneth Ho is partner at the design and construction firm BKDP. For more information about the work of BKDP, please visit their website at www.BKDP.ca.

What Exactly is a Credit Score?

by Mandeep Tatlay

Well first off, a credit score is not a summary of your credit as it is today but is a prediction of how likely you are not to pay your debts over the next two years. The lower the score, the more likely you are not to pay your debts in the future and from the lender's perspective you are considered higher risk. As a higher risk client, you are more likely to have your mortgage application denied and/or receive higher interest rates.

Most Canadians don’t know their credit score or how it is determined. Below I outline information on how you can start taking the right steps towards a better credit score today. What this means to you is that lenders will want to lend you more money and at better interest rate.

Find out your credit score
Credit scores range from 300 (poor) to 900 (excellent). To find out your credit score you can purchase your credit report at www.equifax.ca or www.transunion.ca. If you plan to purchase or refinance you can contact an accredited Mortgage Broker (AMP) who can pull your credit report for free.

What's your Payment History?
Payment history accounts for 35% of your credit score so it's important to pay your bills on time! If you are paying bills online send the payment in at least three banking days before it’s due to avoid it being processed late. Helpful tip: set up a small automatic payment to your credit card issuer each month in order to ensure that at least you are paying the minimum amount, thus avoiding any impact to your credit score.

Avoiding Debt
How much you owe accounts for 30% of your credit score. The below points outline how to manage your debt and maintain a high credit score.

• Never exceed your credit limit. Going over your credit limit doesn’t just result in costly fees but it also hurts your credit score.

• Avoid applying for store credit cards. Each time you apply for an in store credit card there is an inquiry about your credit score. Inquiries are viewed negatively by credit bureaus and hurt your credit score.

• Try not to max out a credit card; instead, distribute your spending. It is better to have two credit cards at 50% capacity than one that is maxed.

• Don’t close unused credit cards. Having a zero balance credit card actually helps to improve a low credit score.

• Don’t apply for too much credit all at once. The credit bureau will look at too many inquires as a sign of financial trouble even if your inquiries are different (for example: car lease, new cell phone, line of credit etc.).

Beware of Pre-Approvals
Being pre-approved by several lenders before you're ready to buy can also hurt your credit score. Therefore, by trying to shop around for a rate yourself, you are actually hurting your own credit score. Going to an Accredited Mortgage Professional means you have one credit report being pulled, which can be used by the mortgage representative on your behalf at numerous lenders.



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About the Author

Mandeep Tatlay, an Accredited Mortgage Professional, has become a recognized name in the Greater Vancouver mortgage industry. She is considered Greater Vancouver’s mortgage expert and her expertise range from refinancing mortgages at the lowest rate to working with credit challenged clients. As an Accredited Mortgage Professional, she helps individuals get the best mortgage at no cost to them. 

All mortgages are not created equal and based on your circumstances, one mortgage could be much better for you than another. For more information visit www.mandeeptatlay.com.

Selling Your Home? Do it the Right Way

There are many reasons to sell a home. Perhaps you need more space for a growing family – or less space because your kids have built their own nests. You may have to relocate for work, or simply feel like a change of environment. Whatever your reason for deciding to sell your home, there are some simple strategies that can help you get the most from your sale. Click through the links below to find out more.

Marketing your home

Now that you are ready to sell your home or condo, you’ll need to start thinking of your property as a product to bring to market.

Do major work in advance. Ask yourself if there are areas in your home that need substantial work to make it sell more quickly and at the best possible price. According to the Appraisal Institute of Canada’s Home Renovation Survey, bathroom and kitchen renovations provide the highest possible payback potential (75% to 100% of the renovation costs) when selling a house, while interior and exterior painting can help you recoup between 50% to 100% of the costs.

You might consider getting a home inspection done as part of your selling strategy. It might set you back about $500, but the inspection can help you spot problems before a potential buyer’s inspector does.

Make your home appealing. First impressions have a huge impact. When potential buyers are coming to look at your home, you’ll want to make it as attractive as possible from the outside and from within. Here are a few ideas to get you started:

• Mow your lawn; trim your hedges; keep the yard free of clutter
• Clean your windows; paint the doors; replace any outside light bulbs
• Fix leaky faucets; replace light bulbs; do any minor painting or other touch-ups around the home.
• Make your bathroom and kitchen sparkle
• Pull back blinds and drapes in the day; turn on all the lights in the evening.
• Don’t cook fish; avoid cooking with garlic and onions

You get the idea. The trick is to make your home as clean, inviting, and attractive as possible. Did you know? Professional "home staging" services can take care of all the presentation and decorating details for you – a good idea if all this cleaning and organizing sounds like too much work.

Take advantage of an agent’s expertise

A real estate agent can be an invaluable aid in your marketing strategy. An agent will be familiar with the real estate values in your area, and can help ensure your home is seen by the greatest number of potential buyers – using the Web, street signs, word of mouth, and multiple listing services. Agents are also trained and obliged to help you get the best price for your home, and will know the best way to structure negotiations to your advantage. Agents will also know what documents you need to have available to show prospective buyers. For example, condo buyers are likely to request information about taxes, maintenance fees, and condo reserve funds.

Revisit your mortgage needs

Many of us sell one home to move into another, so before you put your house up for sale, take some time to review your mortgage options. You’ve probably gained some knowledge of the kind of mortgage you’re comfortable with, but you’ll also need to consider the cost of the new home, how long you plan on staying there, and the outlook for interest rates. Here are a few options to consider:  

Bringing your mortgage with you. Subject to certain conditions (such as the amount of your mortgage), most mortgages are portable – which means that you can take your existing interest rate and mortgage contract to your new home.

Assumable mortgages. With this option, the buyer of your home assumes its mortgage, subject to meeting the financial requirements of your mortgage lender. If you have an attractive mortgage rate, offering an assumable mortgage to prospective buyers can help increase your home’s marketability.  

Refinancing. You might want to consider renegotiating your mortgage but before you do, consider any potential costs. If your mortgage is “closed” (that is, you can’t pay it off ahead of schedule), you may face a penalty when you renegotiate. The key is to determine whether the potential interest-rate savings outweigh the penalty. The rough guideline is that refinancing makes sense if the new rate is at least two percentage points below your current rate. Your mortgage specialist can help you crunch the numbers.  

Blending your rate. Some mortgage lenders also allow you to “blend” your mortgage rate by taking the average of your existing rate and combining it with the mortgage rate on the additional funds you need.

This article was provided by The Bank of Nova Scotia. For more information on smart borrowing strategies, online tools and calculators to help you find the money for your home, visit the Mortgage Centre today. Previously published on HomeRenovationGuide.com.

Real Estate Round Up - Nov 28 to Dec 3

Welcome to this week in Real Estate News. 

Make an offer that can't be refused. Image from The New York Observer, www.observer.com

We start off today with an interesting listing: the house from the Godfather movies is up for sale, as reported in this Globe & Mail article. The asking price is $2.9 million or (yes, they had to add this) "or an offer they can't refuse".

Good news, The Financial Post recently published findings by the Royal Bank of Canada that due to lower house prices and mortgage rates in the last few months, owning a home in Canada has become more affordable. Read more. ... Here's a similar article from Report on Business.

Speaking of affordability, if you already have a mortgage here's advice on how to make a return on it using your RRSP.

I'll leave you with this article from CNN Money that predicts an upcoming housing bust in Canada. Okay, so it was actually published a week ago but this description had to be shared:

"Canada, once known mainly for its Mounties, maple leaves, and muscular peacekeeping presence, now can crow about how it managed to avoid the financial crisis that devastated many of the economies of the Western world."

Send us your links to informative, enlightening or just plain amusing real estate news and stories!

What are CMHC Canada Mortgage and Housing fees?

Zoocasa's "Ask the Pros" is a great place to get answers from real estate professionals! This week's featured Q&A is ...

Question: What are CMHC Canada Mortgage and Housing fees? Is there some way I can reduce these fees?

Answer:
It's probably best to understand why CMHC exists, and it should help answer the question; banks (and other lenders) are forbidden from lending more than 80% of the value of a home in Canada. It's part of the Bank of Canada Act; and it's a huge reason why Canada didn't experience nowhere near the decline that was found south of the border.

Not all Canadians can afford to put down 20% on a home purchase. This is where CMHC steps in. They tell the bank that they will insure that you will not default on your loan if they lend you more than 80%, up to 95%. This insurance fee is absolutely non-negotiable. You wouldn't be able to purchase without CMHC providing the insurance - they are there to assist and encourage home purchasing.

See more Answers to this question.