Hello Everyone,
Last week the banks dropped their rates again to what appears to be an all-time low for fixed rate mortgages. Interesting article from the April edition of Marketing Magazine regarding present consumer confidence in Canada:
Canadian consumer confidence bouncing back: TNS
April 23, 2009 By Kristin Laird
Canadians are feeling feel better about the economic future, with consumer confidence increasing 7% this month, according to the latest results from market research firm TNS.
The firm’s consumer confidence index is up to 90.5 compared to 83.7 in March. Throughout 2007 and into 2008, the confidence index hovered over 100, reaching as high 110.
Numbers are also up in the present situation, expectations, and buy indices—three categories produced each month to show how confidence in the economy is changing.
“Clearly, one snapshot does not a trend make,” said Michael Antecol, vice-president of TNS Canadian Facts and director of the firm’s monthly tracking study. “But these results do suggest that despite the troubling economic news dominating headlines, average Canadians are sensing the end is in sight.”
The present situation index, which captures evaluations of the overall state of the current economic and employment situations, is up just over three points to 75.3. (In late 2007 and into 2008 the present situation index peaked at around 120.)
The expectations index, which measures consumers’ estimation of the economy, household income and employment in the next six months, rose for the fourth consecutive month to 97.4, up 11 points from March.
The TNS buy index, which gauges the degree to which people think the current period is a good time to make major purchases, has increased 9% to 103.9—the highest it’s been since the second quarter of 2005.
“Consumers are saying now is a good time to make that major purchase while at the same time having fairly positive expectations about the future,” said Antecol. “It looks more and more like the ingredients for a consumer-led recovery.”
The TNS Canadian Facts’ Consumer Confidence Index, is based on 1,015 telephone interviews, and has a 3.1% margin of error.
Have a great week!
Monday, April 27, 2009
Wednesday, April 22, 2009
Is Your House Paid For? See How You Can Potentially Pay Off All Your Debt in One Half to One Third the Time!
This might seem like a strange question, but as your mortgage lenders for life, we are constantly searching for ways to significantly benefit our clients. Through an innovative financial service, tens of thousands of American and Canadian homeowners are building equity and paying off their mortgage and all their debt in a fraction of the time.
The best part is:
1. You don’t have to refinance your existing mortgage.
2. Your mortgage payment doesn’t change.
3. There is little, if any, change to your monthly household budget.
To find out if you qualify for this revolutionary service, simply give us a call and schedule a time to learn more. After all, what have you got to lose….except your mortgage payment and all your debt!
Also, we can now help your friends who are not homeowners but have other debts to pay off!
Donna Lewczuk
Mortgage Agent, FSCO Lic M08001430
Mortgage Intelligence, FSCO Lic 10428
905.336.3545
donna.Lewczuk@migroup.ca
***Please Don’t Keep Us a Secret! Should you have family, friends or colleagues who may benefit from this or any of our mortgage and financial services, please have them contact us. Be assured that the people you refer to us will be represented professionally and honestly. Thank you for putting your trust in us.
The best part is:
1. You don’t have to refinance your existing mortgage.
2. Your mortgage payment doesn’t change.
3. There is little, if any, change to your monthly household budget.
To find out if you qualify for this revolutionary service, simply give us a call and schedule a time to learn more. After all, what have you got to lose….except your mortgage payment and all your debt!
Also, we can now help your friends who are not homeowners but have other debts to pay off!
Donna Lewczuk
Mortgage Agent, FSCO Lic M08001430
Mortgage Intelligence, FSCO Lic 10428
905.336.3545
donna.Lewczuk@migroup.ca
***Please Don’t Keep Us a Secret! Should you have family, friends or colleagues who may benefit from this or any of our mortgage and financial services, please have them contact us. Be assured that the people you refer to us will be represented professionally and honestly. Thank you for putting your trust in us.
Monday, April 06, 2009
Government Rebates For 1st Time Home Buyers
These two articles were published Friday April 3, in the National Post and Bloomberg News, respectively.
The first talks about the Canadian economy. It mentions, among other things, incentives for first time home buyers, such as: tax credits for closing costs, an increase in the amount of RRSP withdrawals for downpayments, and rebates on land transfer tax.
The second article highlights some positive signs of late in the U.S. housing and finance economy.
Have a great week!
"A Real Estate Market with Plenty of Reasons to Buy
Helen Morris, National Post, Published: Friday, April 03, 2009
For first-time buyers with secure employment, the housing market may look rather more appealing now than it has in recent years, when they struggled with affordability.
"We know for Toronto, and for Ontario as a whole, there's been a pretty dramatic shift since the fourth quarter of last year, into a buyers' market," says Pascal Gauthier, economist at TD Economics. "Looking ahead to the next, say, 12 to 18 months, it is very difficult to believe that that is going to turn around, just given the economic backdrop."
While a continued buyers' market is good news for them, house hunters shouldn't expect to see a dramatic drop in prices.
"In Toronto, we're not seeing huge price declines," says Laurin Jeffrey, an agent with Century 21 Regal Realty, "but buyers are finding a lot more selection."
While last year, clients would find many properties had been sold before they had a chance to view them, "Now we're going through a list of 50, taking 20 that are good and getting out to see 10 top ones."
Mortgage broker Maria Dominelli advises clients to look very closely at their finances and lifestyle before stepping on to the property ladder.
"The first thing we want to determine is if home ownership is really right for the individual. They've got to look at coming up with the down payment ... [and] maintaining the home. It requires not only money but a commitment in time," says Ms. Dominelli, who works with Invis. "Make sure you do a check on that reality ... so you know the disadvantages and advantages of buying."
Mr. Jeffrey also urges clients to think about potential lifestyle changes that come with home ownership.
"If all of a sudden you're now restricted to a weekend in Montreal and a couple of lattes, when you're used to having dinner out [and vacationing in] Cuba, well, you're not going to be very happy," says Mr. Jeffrey.
If first-time buyers decide they are psychologically ready to take the plunge, there are some new government policies that can help with the finances.
Under the recent federal budget, first-time buyers can qualify for a $750 tax credit to help with closing costs. In addition, they can now withdraw up to $25,000 from their RRSPs under the Home Buyers Plan to help with a down payment, up from the previous $20,000.
First-time buyers in Toronto buying properties of $400,000 or less will receive a maximum rebate of $3,725 on land transfer tax.
Ms. Dominelli says it is always crucial for purchasers to have a back-up financial plan, but especially now in these testing economic times.
"One of the strategies is for people to actually have their mortgages registered for a longer amortization [for lower payments on paper] but to actually make their payments as though they are in a shorter amortization," says Ms. Dominelli. "While you are working, you can afford it. If the sky falls in and you lose your job and need to bide some time, you can ask the lender to change the payments to the lower total again without having to go back and incur legal fees."
Mr. Jeffrey believes in the value of the real estate investment. If your job prospects are good, he says, "Relax, take a breath, be smart. If you don't need that big flat screen TV, don't buy it. But if you need a place to live, prices are down a bit, mortgage rates are stupidly low. It's not a bad time to buy".
"Eased Mortgage Rates Point to Consumer-Driven Rebound
Kathleen M. Howley, Bloomberg News Published: Friday, April 03, 2009
U.S. Federal Reserve Chairman Ben Bernanke is delivering what he promised five months ago, record-low mortgage rates and a refinancing boom that's putting cash in consumers' pockets.
Fixed 30-year mortgage rates fell to a record low for the second consecutive week last week, hitting 4.78%, Freddie Mac said on Thursday in a statement. The rates are the lowest in records dating to 1971, and come after Bernanke told Congress in November that helping the most creditworthy borrowers was essential to reviving the economy.
Mortgage applications in the U.S. rose for the fourth straight week last week as a decline in borrowing costs spurred homeowners to refinance, while purchases of new houses unexpectedly rose in February. The Fed's effort to bring down fixed rates may give consumers as much as US$25-billion, said Mark Zandi, chief economist of Moody's Economy.com.
"It certainly gives further fuel to consumer spending," said Nicolas Retsinas, director of Harvard University's Joint Center for Housing Studies in Cambridge, Massachusetts. "It puts more money into circulation."
The extra cash may help boost first-quarter consumer spending by 1% to 1.5%, said Barton Biggs, managing partner at New York-based hedge fund Traxis Partners LLC. Consumer spending accounts for about two-thirds of the U.S. economy.
Creditworthy Borrowers
Bernanke signaled the Fed's effort to bring down fixed mortgage rates in Nov. 18 testimony to the U.S. House of Representatives' Committee on Financial Services.
"It is imperative that all banking organizations and their regulators work together to ensure that the needs of creditworthy borrowers are met," he said.
One week later, the Fed said it would buy up to $500-billion in home-loan securities, causing the biggest one-day drop in mortgage rates in at least seven years, according to Bankrate.com. On March 18, the central bank almost tripled the size of the program to up to $1.25-trillion in purchases during 2009. The intent is to lower rates and make real estate financing easier to get, the Fed said.
The plan to buy mortgage bonds this year is succeeding where US$11.6-trillion of government lending, spending, and guarantees so far have failed.
‘Successful Effort'
"This has been the most successful effort, at least so far in this crisis, to shore up the economy," said Zandi.
Bernanke's mortgage purchase program may help curb a recession that is in its second year and being driven by the highest jobless rate in a quarter century and shrinking household wealth.
"If you throw enough money at one credit market, you will bring down the price," said Gerald O'Driscoll, a senior fellow at the Cato Institute and former vice president of the Dallas Federal Reserve. "They are targeting the mortgage market in an attempt to speed the process of establishing a floor in the price of housing."
Homeowners who refinance with a half-point drop in fixed rates may save $150 a month on a $300,000 mortgage, said Stephen Stanley, chief economist at RBS Securities Inc. in Greenwich, Connecticut, and a former Fed economist.
Home Prices
Cheaper financing may also help spark a turnaround in the housing market. Sales of previously owned homes rose 5.1% to 4.72 million at an annualized pace in February from the prior month as low mortgage rates spurred demand, the National Association of Realtors said. The NAR's affordability index rose to a record in January, helped by lower home values and mortgage rates. The median U.S. home price in February was $165,400, the NAR said in a March 23 report, down 28 percent from its 2006 high.
Bernanke cited lower mortgage rates in testimony in February as evidence that Fed policies were working, noting that rates had fallen "nearly 1 percentage point" since the program was announced.
On April 1, Federal Reserve Bank of Cleveland President Sandra Pianalto said the Fed's program was resulting in "encouraging signs" for the economy. Besides falling rates, "we are also beginning to see a resurgence in refinancing activity in the residential mortgage markets, spurred on by these lower rates," she said.
The bankers' group boosted its forecast for 2009 home-loan originations by US$800-billion to US$2.78-trillion last month as a wave of refinancing and low interest rates spur homeowners to seek out new loans. Refinancing will increase to US$1.96-trillion in 2009 and purchase originations will total US$821-billion, the group said.
The London interbank offered rate, or Libor, for three- month dollar loans dropped to 1.17% on Thursday, down from 1.43% at the start of the year, showing banks have become more willing to lend.
TED Spread
The so-called TED spread, the gap between what banks and the Treasury pay to borrow money for three months, shrank to 96 basis points from 1.35 percentage points on Dec. 31. It touched a yearly low of 91 basis points on Feb. 2. The gauge reached a high of 4.64 percentage points in October, up from 1.35 percentage points on Sept. 12, the last trading day before Lehman Brothers Holdings Inc. filed for bankruptcy.
U.S. home prices fell 6.3% in January from a year ago, the smallest decline in five months, according to the Federal Housing Finance Agency in Washington.
"We have seen evidence that home sales are bottoming," said Jim O'Sullivan, senior economist with UBS Securities LLC, in Stamford, Connecticut. "This should be positive.""
The first talks about the Canadian economy. It mentions, among other things, incentives for first time home buyers, such as: tax credits for closing costs, an increase in the amount of RRSP withdrawals for downpayments, and rebates on land transfer tax.
The second article highlights some positive signs of late in the U.S. housing and finance economy.
Have a great week!
"A Real Estate Market with Plenty of Reasons to Buy
Helen Morris, National Post, Published: Friday, April 03, 2009
For first-time buyers with secure employment, the housing market may look rather more appealing now than it has in recent years, when they struggled with affordability.
"We know for Toronto, and for Ontario as a whole, there's been a pretty dramatic shift since the fourth quarter of last year, into a buyers' market," says Pascal Gauthier, economist at TD Economics. "Looking ahead to the next, say, 12 to 18 months, it is very difficult to believe that that is going to turn around, just given the economic backdrop."
While a continued buyers' market is good news for them, house hunters shouldn't expect to see a dramatic drop in prices.
"In Toronto, we're not seeing huge price declines," says Laurin Jeffrey, an agent with Century 21 Regal Realty, "but buyers are finding a lot more selection."
While last year, clients would find many properties had been sold before they had a chance to view them, "Now we're going through a list of 50, taking 20 that are good and getting out to see 10 top ones."
Mortgage broker Maria Dominelli advises clients to look very closely at their finances and lifestyle before stepping on to the property ladder.
"The first thing we want to determine is if home ownership is really right for the individual. They've got to look at coming up with the down payment ... [and] maintaining the home. It requires not only money but a commitment in time," says Ms. Dominelli, who works with Invis. "Make sure you do a check on that reality ... so you know the disadvantages and advantages of buying."
Mr. Jeffrey also urges clients to think about potential lifestyle changes that come with home ownership.
"If all of a sudden you're now restricted to a weekend in Montreal and a couple of lattes, when you're used to having dinner out [and vacationing in] Cuba, well, you're not going to be very happy," says Mr. Jeffrey.
If first-time buyers decide they are psychologically ready to take the plunge, there are some new government policies that can help with the finances.
Under the recent federal budget, first-time buyers can qualify for a $750 tax credit to help with closing costs. In addition, they can now withdraw up to $25,000 from their RRSPs under the Home Buyers Plan to help with a down payment, up from the previous $20,000.
First-time buyers in Toronto buying properties of $400,000 or less will receive a maximum rebate of $3,725 on land transfer tax.
Ms. Dominelli says it is always crucial for purchasers to have a back-up financial plan, but especially now in these testing economic times.
"One of the strategies is for people to actually have their mortgages registered for a longer amortization [for lower payments on paper] but to actually make their payments as though they are in a shorter amortization," says Ms. Dominelli. "While you are working, you can afford it. If the sky falls in and you lose your job and need to bide some time, you can ask the lender to change the payments to the lower total again without having to go back and incur legal fees."
Mr. Jeffrey believes in the value of the real estate investment. If your job prospects are good, he says, "Relax, take a breath, be smart. If you don't need that big flat screen TV, don't buy it. But if you need a place to live, prices are down a bit, mortgage rates are stupidly low. It's not a bad time to buy".
"Eased Mortgage Rates Point to Consumer-Driven Rebound
Kathleen M. Howley, Bloomberg News Published: Friday, April 03, 2009
U.S. Federal Reserve Chairman Ben Bernanke is delivering what he promised five months ago, record-low mortgage rates and a refinancing boom that's putting cash in consumers' pockets.
Fixed 30-year mortgage rates fell to a record low for the second consecutive week last week, hitting 4.78%, Freddie Mac said on Thursday in a statement. The rates are the lowest in records dating to 1971, and come after Bernanke told Congress in November that helping the most creditworthy borrowers was essential to reviving the economy.
Mortgage applications in the U.S. rose for the fourth straight week last week as a decline in borrowing costs spurred homeowners to refinance, while purchases of new houses unexpectedly rose in February. The Fed's effort to bring down fixed rates may give consumers as much as US$25-billion, said Mark Zandi, chief economist of Moody's Economy.com.
"It certainly gives further fuel to consumer spending," said Nicolas Retsinas, director of Harvard University's Joint Center for Housing Studies in Cambridge, Massachusetts. "It puts more money into circulation."
The extra cash may help boost first-quarter consumer spending by 1% to 1.5%, said Barton Biggs, managing partner at New York-based hedge fund Traxis Partners LLC. Consumer spending accounts for about two-thirds of the U.S. economy.
Creditworthy Borrowers
Bernanke signaled the Fed's effort to bring down fixed mortgage rates in Nov. 18 testimony to the U.S. House of Representatives' Committee on Financial Services.
"It is imperative that all banking organizations and their regulators work together to ensure that the needs of creditworthy borrowers are met," he said.
One week later, the Fed said it would buy up to $500-billion in home-loan securities, causing the biggest one-day drop in mortgage rates in at least seven years, according to Bankrate.com. On March 18, the central bank almost tripled the size of the program to up to $1.25-trillion in purchases during 2009. The intent is to lower rates and make real estate financing easier to get, the Fed said.
The plan to buy mortgage bonds this year is succeeding where US$11.6-trillion of government lending, spending, and guarantees so far have failed.
‘Successful Effort'
"This has been the most successful effort, at least so far in this crisis, to shore up the economy," said Zandi.
Bernanke's mortgage purchase program may help curb a recession that is in its second year and being driven by the highest jobless rate in a quarter century and shrinking household wealth.
"If you throw enough money at one credit market, you will bring down the price," said Gerald O'Driscoll, a senior fellow at the Cato Institute and former vice president of the Dallas Federal Reserve. "They are targeting the mortgage market in an attempt to speed the process of establishing a floor in the price of housing."
Homeowners who refinance with a half-point drop in fixed rates may save $150 a month on a $300,000 mortgage, said Stephen Stanley, chief economist at RBS Securities Inc. in Greenwich, Connecticut, and a former Fed economist.
Home Prices
Cheaper financing may also help spark a turnaround in the housing market. Sales of previously owned homes rose 5.1% to 4.72 million at an annualized pace in February from the prior month as low mortgage rates spurred demand, the National Association of Realtors said. The NAR's affordability index rose to a record in January, helped by lower home values and mortgage rates. The median U.S. home price in February was $165,400, the NAR said in a March 23 report, down 28 percent from its 2006 high.
Bernanke cited lower mortgage rates in testimony in February as evidence that Fed policies were working, noting that rates had fallen "nearly 1 percentage point" since the program was announced.
On April 1, Federal Reserve Bank of Cleveland President Sandra Pianalto said the Fed's program was resulting in "encouraging signs" for the economy. Besides falling rates, "we are also beginning to see a resurgence in refinancing activity in the residential mortgage markets, spurred on by these lower rates," she said.
The bankers' group boosted its forecast for 2009 home-loan originations by US$800-billion to US$2.78-trillion last month as a wave of refinancing and low interest rates spur homeowners to seek out new loans. Refinancing will increase to US$1.96-trillion in 2009 and purchase originations will total US$821-billion, the group said.
The London interbank offered rate, or Libor, for three- month dollar loans dropped to 1.17% on Thursday, down from 1.43% at the start of the year, showing banks have become more willing to lend.
TED Spread
The so-called TED spread, the gap between what banks and the Treasury pay to borrow money for three months, shrank to 96 basis points from 1.35 percentage points on Dec. 31. It touched a yearly low of 91 basis points on Feb. 2. The gauge reached a high of 4.64 percentage points in October, up from 1.35 percentage points on Sept. 12, the last trading day before Lehman Brothers Holdings Inc. filed for bankruptcy.
U.S. home prices fell 6.3% in January from a year ago, the smallest decline in five months, according to the Federal Housing Finance Agency in Washington.
"We have seen evidence that home sales are bottoming," said Jim O'Sullivan, senior economist with UBS Securities LLC, in Stamford, Connecticut. "This should be positive.""
Wednesday, April 01, 2009
On-line Application up and Running!
Hello everyone,
Recently we have had some technical challenges withour on-line application. We are pleased to say that this problem has been corrected and the application is fully functional.
Below is an article taken from the National Post. It talks about the housing market in the U.S. mainly, and shows some signs of hope in terms of a recovery. Though the situation up here is far different, the U.S. market nevertheless affects us as well. Here it is:
"Sales of previously owned U. S. homes rose at their fastest pace in nearly six years in February, data showed yesterday, offering some hope to an economy battling a 15-month recession.
The National Association of Realtors said sales rebounded 5.1% in February to a 4.72 million-unit annual rate, notching their largest gain since July, 2003, but about 45% of these were foreclosure or short-sale transactions.
This was above market expectations for a drop to a 4.45 million-unit pace after January's 4.49 million rate. Compared with the same period last year, February sales were down 4.6%, the NAR said.
U. S. stocks, already rallying after the U. S. government released details of a plan to clean out toxic assets from banks' balance sheets, extended gains on the housing data.
The housing market is at the core of the economic, and financial meltdown and stabilizing it is seen as a key ingredient for the recovery from a recession that started in December, 2007.
"Because entry-level buyers are shopping for bargains, distressed sales accounted for 40%-45% of transactions in February," said NAR chief economist Lawrence Yun. "Distressed homes typically are selling for 20% less than the normal market price, and this naturally is drawing down the median price."
Sales were up in all four regions, with the West outperforming. In California, the median listing price rose for the first time in three years.
Government data last week showed a rebound in U. S. housing starts and new building permits in February.
"It suggests that the drop in prices and mortgage rates and an increase in affordability are having an impact in the market," said Alan Gayle, senior investment strategist at Ridgeworth Investments in Richmond, Va. "Stabilization in the housing market is critical for the economy to start, and this is a good report."
There is hope that the government's US$272-billion package to stem the tide of foreclosures, together with aggressive efforts by the U. S. Federal Reserve to keep interest rates down, could lay the foundation for the housing market's recovery.
NAR's Mr. Yun said the government's stimulus package could add a million sales this year, but depressed levels of consumer confidence and rising unemployment could derail this projection. The median national home price declined 15.5% in February from a year ago to US$165,400, the second-biggest decline on record."
Have a great week everyone!
Recently we have had some technical challenges withour on-line application. We are pleased to say that this problem has been corrected and the application is fully functional.
Below is an article taken from the National Post. It talks about the housing market in the U.S. mainly, and shows some signs of hope in terms of a recovery. Though the situation up here is far different, the U.S. market nevertheless affects us as well. Here it is:
"Sales of previously owned U. S. homes rose at their fastest pace in nearly six years in February, data showed yesterday, offering some hope to an economy battling a 15-month recession.
The National Association of Realtors said sales rebounded 5.1% in February to a 4.72 million-unit annual rate, notching their largest gain since July, 2003, but about 45% of these were foreclosure or short-sale transactions.
This was above market expectations for a drop to a 4.45 million-unit pace after January's 4.49 million rate. Compared with the same period last year, February sales were down 4.6%, the NAR said.
U. S. stocks, already rallying after the U. S. government released details of a plan to clean out toxic assets from banks' balance sheets, extended gains on the housing data.
The housing market is at the core of the economic, and financial meltdown and stabilizing it is seen as a key ingredient for the recovery from a recession that started in December, 2007.
"Because entry-level buyers are shopping for bargains, distressed sales accounted for 40%-45% of transactions in February," said NAR chief economist Lawrence Yun. "Distressed homes typically are selling for 20% less than the normal market price, and this naturally is drawing down the median price."
Sales were up in all four regions, with the West outperforming. In California, the median listing price rose for the first time in three years.
Government data last week showed a rebound in U. S. housing starts and new building permits in February.
"It suggests that the drop in prices and mortgage rates and an increase in affordability are having an impact in the market," said Alan Gayle, senior investment strategist at Ridgeworth Investments in Richmond, Va. "Stabilization in the housing market is critical for the economy to start, and this is a good report."
There is hope that the government's US$272-billion package to stem the tide of foreclosures, together with aggressive efforts by the U. S. Federal Reserve to keep interest rates down, could lay the foundation for the housing market's recovery.
NAR's Mr. Yun said the government's stimulus package could add a million sales this year, but depressed levels of consumer confidence and rising unemployment could derail this projection. The median national home price declined 15.5% in February from a year ago to US$165,400, the second-biggest decline on record."
Have a great week everyone!
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