Learn more about Canadian mortgage rates, rules and the latest news – read on!
Here’s our latest recap of Canadian mortgage and real estate news. This week we look at: The latest housing affordability report, which came out with fairly predictable results How the post-OSFI stress test bump in business for credit unions may not be materializing What HomEquity’s 2017.... More »
Remember all those pessimists who were calling for a housing bubble or collapse? If you listened to them and rented for the past eight years, how much would you have lost? How much would your rent have increased since then? And would you still be able to rent that condo or house… or would you.... More »
Many mortgage brokers and other sales/service professionals keep track of numbers to measure whether we’re on track for growth year-over-year. So, I did some math. Since becoming a broker in 2004, my team and I have successfully funded more than $920 million in mortgages. That’s a big n.... More »
For homebuyers and homeowners alike, all eyes have been on the housing market in recent months waiting to see where house prices are eventually headed. With house prices already cooling on average across the country, particularly in and around the Greater Toronto Area, some are speculating that the .... More »
There have been a number of reports released over the past few weeks that have provided some interesting insight into the state of the housing and mortgage markets. New reports have touched on everything from 2018 renewal rates, foreign buyer statistics and credit quality to the latest financial cru.... More »
Three months into 2018, it seems like the Canadian housing market is down again with sales volume dropping 16.9 per cent in February compared to this time last year. According to the Canadian Real Estate Association (CREA), there was also a 6.5 per cent drop compared to January, which is the biggest decline in nearly five years.
This shouldn’t be a huge surprise since the Office of the Superintendent of Financial Institutions (OSFI) introduced tighter mortgage rules effective January 2018. As a result, some homeowners rushed to make their purchase before the new rules took effect, which is why there was a lot of sales activity leading to the end of 2017.
National prices on the decline
When looking across the country, the average price of homes sold fell five per cent from one year ago to $494,000. If you remove the hot markets of the Greater Vancouver and Greater Toronto, then prices would fall another $112,000 – averaging at $382,000.
“Sales activity is down in many, but not all, housing markets compared to the end of last year, and varies depending on price range, location and property type…
While alternative lenders can provide a lifeline for Canadians who have run out of other financing options, it’s important to read the fine print.
When it comes to mortgages, $100 isn’t going to get you very far. But what if you paid an extra $100 a month towards your mortgage? It’s not a lot of money these days, but it can add up to some solid savings over time.
Let’s look at a $300,000 mortgage with a 2.89% rate and a 25-year amortization. At the end of five years, you’ve paid off an extra $6,444. The balance owing is $249,435. And the remaining amortization is 17 years and 9 months instead of 20 years. This also represents an interest savings of $11,423 over the life of the mortgage. Not bad!
Now let’s look at paying an extra $200 per month. At the end of five years, you’ve paid off an extra $12,888. The balance owing is $242,991. And the remaining amortization is 15 years and 11 months. This represents an interest savings of $20,708 over the life of the mortgage!
But what about higher interest rates? Today’s rates are extremely low and we all know they’re expected to increase gradually over the next couple of years (click here for more on rising rates)…