Tuesday, October 29, 2013

Flaherty won’t intervene in housing market but keeping close tabs

BILL CURRY OTTAWA — The Globe and Mail Monday, Oct. 28 2013
Finance Minister Jim Flaherty says he has no intention of interfering in the housing market “at the time being” but plans to meet with developers to learn more about what could be driving the sector’s recent steam
Following a meeting in Ottawa with private sector economists, Mr. Flaherty said he was urged to take a closer look at the sector.
With commitments to near zero interest rates for the near term, Mr. Flaherty noted that the Bank of Canada has no policy room to respond to the housing market. As a result, any response would have to come from the Department of Finance, though he stressed that the government has no plans to interfere in the market at this time.
“Some of the economists this morning suggested that I have some conversations with some people in the building industry – some more conversations – because of what we’re seeing in certain parts of the country: a re-acceleration of housing prices,” he said.
“I do speak to people regularly in the business and I’m going to do more of it now, because I want to ensure that this isn’t just a temporary bubble. One theory is that we’re pulling forward housing sales by the reality that eventually interest rates will go up and so that some people who perhaps should be waiting a bit are going ahead and buying, but this is speculation and we’re going to have to look into it more. But I have no intention of interfering in the market at the time being.”

Monday, October 28, 2013

September 2013 Housing Starts in Canada

OTTAWA, October 8, 2013 — Housing starts in Canada were trending at 190,492 units in September compared to 188,440 in August, according to Canada Mortgage and Housing Corporation (CMHC). The trend is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR)1 of housing starts.
“The trend in total housing starts edged up slightly in September, while remaining close to the range of roughly 182,000 to 188,000 units that was observed between March and August of 2013. This recent moderate gain is consistent with sales of existing homes, which have trended higher since February 2013. The trend in the new home market typically lags the trend in the existing home market”, said Mathieu Laberge, Deputy Chief Economist at CMHC.
CMHC uses the trend measure as a complement to the monthly SAAR of housing starts to account for considerable swings in monthly estimates and obtain a more complete picture of the state of the housing market. In some situations analyzing only SAAR data can be misleading in some markets, as they are largely driven by the multiples segment of the markets which can be quite volatile from one month to the next.
The standalone monthly SAAR was 193,637 units in September, an increase from 183,964 in August. The SAAR of urban starts increased by 4.3 per cent in September to 177,240 units. Multiple urban starts increased by 5.9 per cent to 113,705 units in September while the single urban starts segment saw an increase of 1.4 per cent to 63,535 units.
In September, the seasonally adjusted annual rate of urban starts increased in Atlantic Canada, the Prairies, British Columbia and Quebec, and decreased in Ontario.
Rural starts2 were estimated at a seasonally adjusted annual rate of 16,397 units.
Preliminary Housing Starts data is also available in English and French at the following link: Preliminary Housing Starts Tables
As Canada's national housing agency, CMHC draws on more than 65 years of experience to help Canadians access a variety of high quality, environmentally sustainable and affordable housing solutions. CMHC also provides reliable, impartial and up-to-date housing market reports, analysis and knowledge to support and assist consumers and the housing industry in making informed decisions.
Follow CMHC on Twitter @CMHC_ca
1 All starts figures in this release, other than actual starts and the trend estimate, are seasonally adjusted annual rates (SAAR) — that is, monthly figures adjusted to remove normal seasonal variation and multiplied by 12 to reflect annual levels. By removing seasonal ups and downs, seasonal adjustment allows for a comparison from one season to the next and from one month to the next. Reporting monthly figures at annual rates indicates the annual level of starts that would be obtained if the monthly pace was maintained for 12 months. This facilitates comparison of the current pace of activity to annual forecasts as well as to historical annual levels.
2 CMHC estimates the level of starts in centres with a population of less than 10,000 for each of the three months of the quarter, at the beginning of each quarter. During the last month of the quarter, CMHC conducts the survey in these centres and revises the estimate.
Information on this release:
Charles Sauriol
CMHC Media Relations
Additional data is available upon request.
Housing Starts in Canada — All Areas

Preliminary Housing Start Data
September 2013
Canada August 2013 September 2013
Trend1, all areas 188,440 190,492
SAAR, all areas 183,964 193,637
SAAR, rural areas 13,999 16,397
SAAR, urban centres2

Single-detached 62,643 63,535
Multiples 107,322 113,705
Total 169,965 177,240
Atlantic, urban centres2 6,951 9,022
Quebec, urban centres2 29,943 31,716
Ontario, urban centres2 68,482 57,808
Prairies, urban centres2 39,339 49,061
British Columbia, urban centres2 25,250 29,633
Canada September 2012 September 2013
Actual, all areas 19,761 17,559
Actual, rural areas 2,144 2,108
Actual, urban centres2    
September — Single-detached 6,168 5,838
September — Multiples 11,449 9,613
September — Total 17,617 15,451
January to September — Single-detached 50,476 47,058
January to September — Multiples 96,011 77,344
January to September — Total 146,487 124,402
Source: CMHC 1 The trend is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR). 2 Urban centres with a population of 10,000 and over.
Detailed data available upon request

Thursday, October 17, 2013

Why a Mortgage Broker is Your Best Option

Posted by: ON the GO Magazine in House and Home September 30, 201
Whether it’s your first time or your fifth time, shopping for a mortgage can often be confusing and even frustrating. Besides, who really has the time to research and compare mortgage lenders to ensure the best deal? Then there are all those crazy terms and acronyms — beacon scores, LTVs, IRDs and porting – it can make your head spin! Isn’t there an easier way?
There is indeed, and that’s where the expert care of a licensed mortgage Broker can be your best option.
Mortgage Brokers work for you, so they can offer more options than any one mortgage lender. Plus mortgage lenders — like MCAP — only work with brokers who have been thoroughly vetted and have a valid broker licence. They not only help find the best deal for you, they stay at your side every step of the way.
There are four main advantages to using a mortgage Broker: choice, advice, service and savings.

Choice: Only mortgage Brokers can provide the wide range of mortgage products from various lenders to meet your specific financial needs.
Advice: Mortgage Brokers offer alternatives in selecting a mortgage product and other financial services that are best suited for your situation.
Service: Mortgage Brokers work with your schedule and are there with you from the first meeting to the final close.
Savings: Mortgage Brokers save you money by providing — on average — lower interest rates. According to a study* conducted by the Canadian Association of Accredited Mortgage Professionals, home owners who renewed or renegotiated with a mortgage Broker reported an average rate decrease of 1.4% compared with 1.0% among all renewers.
These four reasons are also why mortgage lenders like MCAP work solely through a national network of trained professional mortgage Brokers. MCAP and other independent mortgage lenders know that a mortgage Broker will help make a home purchase or renewed mortgage a positive experience for everyone.
If you’re thinking about buying your first home, looking to renew your current mortgage or are curious if there is a better deal out there for your current mortgage, talk to a licensed mortgage Broker today and find out what they can do for you!


Tuesday, October 1, 2013

Canadians preparing for life without retirement

Gail Johnson | Pay Day It looks like the concept of retiring is ready for retirement. Nearly one in five Canadian workers (17 per cent) expect that they’ll never be able to retire fully, compared to 12 per cent globally, according to a new HSBC report.
The Future of Retirement: Life after Work? global survey also found that 40 per cent of retired Canadians said they had not prepared adequately or at all for a comfortable retirement, while 4 per cent of those retirees reported they’d have to go back to work to cover their financial shortfall.
Furthermore, 54 per cent of retired Canadians who said they’ve been unable to realize their retirement plans believed this is because they have less money to live on than they had expected.
“Where some people regard a comfortable retirement as a natural entitlement, for a growing number [of Canadians] this is not the case,” says Betty Miao, executive vice president of retail banking and wealth management at HSBC Bank Canada.
So what’s fuelling the “age of the unretired”? Vancouver certified financial planner Anne Brandt says several factors have contributed to people being unprepared financially for their so-called golden years.
Employment changes
Lack of full-time employment, loss of guaranteed pensions and restructuring in peak earnings years have crushed the retirement dreams of many Canadians.

“A lot of people are finding that they can’t retire as soon as they wanted to with all the downsizing that’s gone on over the years,” Brandt says.
"It’s also harder if you’ve been downsized in your 50s or later to find employment that pays what you were making prior to that, and sometimes it takes a while to find new work. People who had to change jobs might have been in a defined benefit plan and now they no longer are.”
The Great Recession
We all saw the markets crash, and when they did, Baby Boomers say their retirement dreams go up in smoke. “With what happened in 2008, people’s portfolios are just now starting to recover after a five-year loss in terms of growth,” Brandt says. “That’s definitely put things behind.”

Assumption that expenses will decrease in retirement
According to the HSBC report, 52 per cent of global respondents in retirement have seen no reduction in their expenses, while 17 per cent have seen their expenses increase. Many people aren’t prepared specifically for the costs of aging like medical, home care and nursing-care costs.

Boomerang kids
According to Statistics Canada, 42.3 per cent of young adults aged 20 to 29 lived in the parental home putting a strain on parents who thought they would be empty nesters. “Especially in markets like Vancouver, a lot of people have kids at university who are living at home because they can’t afford to move out,” Brandt notes.

Stuck in the sandwich generation
More and more Canadians find themselves caring for children as well as aging and possibly ailing parents, putting them in a financial vise. According to recent data from Statistics Canada, there are more than 8 million caregivers in Canada's "sandwich generation."

Hefty mortgage payments
“Some people do end up with mortgages when they go to retire,” Brandt says. “I do see people who have a $400,000 mortgage when they’re retiring and they’re going to have to work or go back to work, even if they left or received a package, even if they’re in their 60s.”

Relying solely on the family home as nest egg
Relying solely on your home to finance retirement is a risky plan. “For many people, a lot of their equity is in their homes,” Brandt notes. “If you downsize, where are you going to go? It can be difficult, because even going into a condo or a townhouse, by the time you start to pay condo fees, and you’ve added the cost of the commission to a realtor, and you get to the new place do a few renos, you don’t have a lot of money left.”

Not budgeting
“A lot of people don’t know what they spend,” Brandt says. “You don’t need to nickel and dime yourself, but going into retirement, it’s really important to know what you actually spend money on.” Many financial planners suggest tracking spending for a few weeks or months to really get a grip on this.

Rushing into retirement
Sixty-four per cent of all survey respondents who entered semi-retirement wished that they had stayed in full-time employment longer. This regret is largely for positive reasons, with many retired people seeing work as an important means of keeping the body and mind active.

On the positive side of things, many semi-retired Canadians said they genuinely wanted to stay in the work force. Forty-seven per cent said they like keeping active physically and mentally, 41 per cent said they like working, and 35 per cent said it would ease the transition into retirement.
“I do see lots of people who are prepared for retirement,” Brandt notes. “It is possible.”