Millennials and the GTA Home Market

Millennials and the GTA Home Market

Why are millennials finding it so difficult to get into the GTA housing market?

A new report by Ryerson University finds that over the next decade, 700,000 millennials in the Greater Toronto and Hamilton Area (GTHA) will move out of their parent’s home in search of their own.

Policymakers seem to be focused on the demand side of the equation, when the issue appears to be housing. We need more starter homes such as duplexes, row houses and stacked townhouses in the GTHA. This could help relieve some of price pressure from the increased millennial housing demand.

To give millennials a voice at the upcoming provincial elections, Ontario Real Estate Association (OREA) has launched the Keep the Dream Alive campaign. The campaign is aimed at helping ensure that affordable homeownership remains a top priority in the provincial election. Millennials don’t just need affordable housing; they need housing that they can afford. By joining the campaign, you can do your part to ensure homeownership remains within reach for future generations.

Sign up for the Keep the Dream Alive campaign and send a strong message to your local candidates that housing affordability for millennials truly matters.

Watch our video interview with Jon-Carlos Tsilfidis, President at Fairside Homes, Board of Director at http://www.bildgta.ca, Chair at http://www.chba.ca/. In this Q&A, he will answer your questions such as:

“Why are millennials finding it so difficult to get into the GTA housing market?”


Housing affordability is a complex subject. What is common to all three definitions is lack of supply. Not enough new housing is being built for sale or rent, and there is not enough not-for-profit rental housing to meet the need. This results in higher prices, higher rents and long wait lists.

Read more: https://www.thestar.com/life/homes/opinion/2018/06/02/gta-housing-policies-must-focus-on-increasing-supply.html

 



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First-Time Buyer Tips: What to Expect From the Home Inspection

First-Time Buyer Tips: What to Expect From the Home Inspection

Variable Mortgage Rates

By Kris Lindahl

Home inspections are a fairly standard contingency for most home buyers so they can be assured their home is structurally sound before moving in. But many buyers don’t understand the nature of home inspections and how important it is to have clear expectations of what they do. To clear up any confusion, learn more about what home inspections do, how they happen, and what buyers can do if the inspector finds a problem.

Finding the Right Inspector

It’s important to check the reputation of an inspector before moving forward with one or the other. Some have been known to downplay the problems they find, either because they’re loyal to a third party or because they simply don’t understand the extent of a problem that’s staring them right in the face. Inspectors are regulated in some provinces like Alberta and British Columbia, which can make it easier for buyers find qualified professionals. But in places where they aren’t regulated, such as Ontario, it’s especially helpful for buyers to do their homework.

Dos and Don’ts

A home inspector is primarily looking for damage or degradation throughout the home. They’ll check everything from the state of the floor sills and joists to the stability of the roof and the foundation. A good inspector will be able to spot warning signs such as mildew as well as note the presence of cosmetic problems such as peeling paint. What a home inspector won’t do is make any kind of changes to the home. They’re not authorized to break down walls to ensure the pipes are entirely up to code or tear up floors to guarantee the electrical wiring isn’t starting to wear away.

Why Home Inspections Matter 

If an inspector can only tell the home buyer so much about the structural integrity of their home, then buyers may question if it’s even worth it to hire one. But while a home inspector isn’t all-knowing, they can see far more than a home buyer or even a real estate agent can when it comes to the quality of the components and the longevity of the home’s design. A home that’s been poorly tended to over the years or one with shoddy construction will often have small problems that no one catches until they balloon into catastrophes. Just a small gap in the foundation can be just the invite insects need to take over the home, and a home inspector can catch that gap long before the infestation occurs.

How It Happens 

Inspections take between 2.5 to 3 hours to inspect both the interior and the exterior of the home. Inspectors will be looking at everything from circuit panels to distribution piping to drainage, so buyers are highly encouraged to attend the inspection as inspectors go about their work. Home inspection reports are not only detailed, but they’re also confusing to people outside the industry. Buyers may not know the terms, which can cause them to either make assumptions or give up halfway through. Going with the inspector gives buyer a chance to ask questions in real time, which can be the key to understanding what they’re about to jump into.

How to Handle a Problem 

If an inspector does happen to find something, a buyer has a few different options if they made their offer contingent on the home inspection. They can either back out of the sale, request the seller fix the problem (either in full or in part), or take responsibility for the issues themselves. In the case of purely cosmetic (inexpensive) repairs, it usually makes more sense to swallow for the buyer to swallow the cost of the repairs. Escrow periods can be complicated enough without adding additional conditions. However, it the case of major trouble, buyers may want to consider taking the either canceling the sale or demanding the seller fixes the problem.

Home inspectors perform a valuable service to buyers, even if they can’t predict the future. They’re often the only thing that can stop a buyer from making a huge mistake. Once buyers have a better understanding of what they do, they can make better decisions about whether or not to follow-through on their original offer.

 



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There’s Never Been a Better Time to go with a Variable Rate Mortgage

There’s Never Been a Better Time to go with a Variable Rate Mortgage

Variable Mortgage Rates

By Roy Cocciollo

As your mortgage broker, I am already sending you a monthly email newsletter to keep you up to date on the market. But the current mortgage rate news needs special attention. Yet another bank discounted their variable mortgage rates last week. Meanwhile, Canada’s largest lenders all raised their benchmark posted 5-year fixed mortgage rates, signaling a rise in borrowing costs. You are likely asking: “What’s the impact on my variable rate mortgage?”

The bottom line: The Prime Rate would have to increase 4 times to get the current variable rates to exceed the current fixed rates. If you have a variable rate mortgage at prime -60 or less, you should give us a call, because I have access to lower rates.

Let’s compare these two rates and the impact on the interest:

Using 400K mortgage 25-year amortization

In the example above, paying the penalty outweighs your overall savings in interest paid.

Big banks have a different strategy in mind. Instead of offering their clients the best rates to keep your loyalty, they are making it more difficult for you to qualify somewhere else (thanks to the stress testing that came into effect this year).

And if your mortgage is up for renewal this year, here are some things to do:

1. Start looking at your options as soon as possible to make sure nothing is getting in your way of securing the best mortgage.

2. Don’t just sign your bank’s initial renewal letter. Evaluate and negotiate.

3. Consider all the factors, not just the rate. Understand all your mortgage terms including portability, prepayment privileges and penalties.

REMEMBER, the best time to negotiate is when you are renewing your mortgage. Let your current lender EARN your business at every renewal. The application process is not very difficult and doesn’t take up too much time. Start early and reach out to the right Mortgage Agent or Broker, get the knowledge you need to make an informed decision.

Remember, we can shop your mortgage to more than just one bank (including your existing one).

Forward this blog to friends and family, or just hit reply to this email – I am ready to help. Let’s start with a quick analysis of your situation.

 



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Is Your Mortgage up for Renewal in 2018?

Is Your Mortgage up for Renewal in 2018?

Mortgage Renewal 2018

By Joe Busillo

A recent widely published report by CIBC estimated that a record 47% of all Canadian residential mortgages will come up for renewal in 2018. So big banks should be doing everything in their power to ensure you remain their client, right?

It turns out that banks have a different strategy in mind. Instead of offering their clients the best rates to keep your loyalty, they are raising their posted rates, making it more difficult for you to qualify somewhere else (thanks to the stress testing that came into effect this year).

If you really want to start saving money, contact an experienced mortgage professional. You can then compare the savings to switch or refinance and decide whether you prefer to stay with your bank or take control of your mortgage to start saving money. Big banks are not your only option. There are some excellent lenders out there that would love the opportunity to compete for your business. You don’t need to open up an account with them and you can keep the same account you are currently using for your mortgage payments (unless your bank is charging you a fee to keep that account!)

 


 

If your mortgage is up for renewal this year, here are some things to do:

 

1

Start looking at your options as soon as possible to make sure nothing is getting in your way of securing the best mortgage.

 

2

Don’t just sign your bank’s initial renewal letter. Evaluate and negotiate.

 

3

Consider all the factors, not just the rate. Understand all your mortgage terms including portability, prepayment privileges and penalties.

 


 

REMEMBER, the best time to negotiate is when you are renewing your mortgage. Let your current lender EARN your business at every renewal. The application process is not very difficult and doesn’t take up too much time. Start early and reach out to the right Mortgage Agent or Broker, get the knowledge you need to make an informed decision.

You work hard for your money! A few minutes of paperwork collection could save you thousands of dollars.

 



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How to get a better rate when you renew with your bank

How to get a better rate when you renew with your bank

Protect your mortgage

By Joe Busillo

I recently received a notice in the mail from one of the BIG SIX and it had nothing to do with Drake.

They were notifying me that my secured line of credit (LOC) rate was about to increase by .10% “to be in line with their competitors and market prices”. While the increase itself was not huge, I questioned the rationale and decided to do something about it.

I had two options:

  1. Simply “accept” the changes by not closing out the LOC, or
  2. Call to discuss the changes.

I chose option #2 – no surprise there. I reached a client care specialist immediately and she was very friendly. I let her know that I was concerned about the seemingly arbitrary increase in my secured LOC rate. And here is the important part, I highlighted that the Bank of Canada rates did not change, so “why was my cozy green couch becoming suddenly less comfortable?”, I said.

The Bank client care specialist read the carefully prepared talk track, let me know that I had every right to be upset and that I could go into my branch and get this reversed (if they deemed my case to be worthy). Although the conversation was pleasant, I escalated to talk to a supervisor to argue my case…

My argument focused on a few very basic things:

  • I was qualified originally under an already existing stress test, have never missed a payment and have been a loyal client for over 35 years. Why should my rate go up?
  • Why is this Bank’s Prime Rate higher than the other banks?
    Is it for penalty calculations?
    For example, am I supposed to feel better buying shoes at $100 discounted by 30% and paying $70; or buying the same shoes priced lower but with only a 20% discount?
    Don’t trick me with an exaggerated discount or penalize me with an unfair return policy (beware of penalty calculations)
  • I need to see proof – show me which of the other big banks are offering a similar rate on secured lines
  • What’s the advantage of taking the Variable Rate if the Bank is able to change the rate whenever they want?
  • If I had taken a 5 year Fixed Rate, would the Bank have the same right to raise this rate? Would the notice read “…you did too good a job negotiating so we’re going to increase the rate by .10%”. Ha!

Accepting the rate change was not an option!

When you feel you are being taken advantage of, no matter how much, YOU can take a stand and make a difference.

It is a numbers game for them, don’t be their number. Shop around.

My rate will remain the same. I’m ready to negotiate on your behalf.

Call, text or email me today: https://yourmortgageyourway.ca/joe-busillo/

 



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