Ottawa home construction up slightly in June + MORE Jul 10th

It’s been one year since the federal government last tightened mortgage lending rules in this country and a recent poll for BMO suggests the majority of potential homebuyers have not been affected. One-in-five (19%) however did say the changes (including maximum amortization of 25 years and loans limited to 80% of the property value for insured borrowers) have prompted them to wait longer to buy. The report also found the average amount first-time home buyers plan to spend is approximately $300,000, with an average down payment amount of $48,000 or 16%.
Is the lowly loonie putting a damper on your vacation spending plans? CIBC expects the Canadian dollar to be back at parity with the U.S. greenback by the end of 2014.
The U.S.-based National Foundation for Credit Counseling is trying to rid the word “budget” of its negative connotations after a website poll revealed that 57% of respondents misunderstand the purpose of a budget, viewing it as a restriction on their spending…

Construction on new homes in Ottawa rose slightly in June compared to the same month last year, but the modest bump wasn’t enough to restore the pace of construction in the city to 2012 levels. According to the Canada Mortgage and Housing Corp. (CMHC) Ottawa builders began construction on a total of 656 new homes in June, slightly more than the 628 recorded in June 2012.

The Canadian Mortgage and Housing Corporation (CMHC) recently issued new guidelines for the use of debt ratios and confirmation of income documents in their mortgage calculators. Set to take effect on December 31, 2013, many lenders are already adhering to the stipulations, while others, like Genworth Canada, are in the process of reviewing them, and may not completely implement the guidelines by the end of the year.
What the new debt ratio rules mean for borrowers
Last year, the Department of Finance issued its fourth round of rules tightening mortgage insurance practices. Those rules, intended to shield the Canadian economy from the brunt of the worldwide debt crisis, set restrictions on mortgage applications for new borrowers with less than 20 percent equity. The long-term repercussions of last year's moves, along with this newest set of rules from the CMHC, should serve to further cement mortgage standards and close existing loopholes.
In its effort to clarify how each key input is to be treated when calculating debt service ratio, CMHC included several specific factors in its latest round of rules…

We have options to help you buy a new home:
Given the continued government manipulation and changes in the Canadian mortgage market, the above issue is becoming a common one when clients want to buy a new home.  The reason that the bank is telling you that you have to sell your current home to buy a new home has to do with the rental offset and calculation that the banks use. The good news is that we have couple of remaining lenders in Canada that use a much more favorable calculation for you.
Here is an example to illustrate your qualifying:
Assuming an income of $60 000, and your current home payments of $1200 with rental income of $1500. - Based upon these rough numbers, to a common sense person your rental property covers its expenses and should not count against you……………..unfortunately no one chose to inform the banks and CMHC about common sense
The bank qualification method based upon their rental add back will qualify you for a mortgage of about $200 000
Based upon using a net rents calculation that takes into effect a much more realistic look at your true property costs and revenue we are able to approve you for a mortgage of around $300 000…

President’s Choice Fin’l 10 year Closed mortgage rate was changed on July 08, 2013