Housing prices set to fall: CIBC
Filed Under Main Content · Tagged: Bank Of Commerce, Banks Canada, British Columbia, Canadian Imperial Bank, Canadian Imperial Bank Of Commerce, Cibc, Crash, Demographic Changes, Economist, House Prices, Imperial Bank Of Commerce, Market Fundamentals, Vancouver Sun
Vancouver Sun- A new report from one of the country’s major banks says house prices in Canada are sitting 14 per cent over their “fair” value.
The report from Canadian Imperial Bank of Commerce says the average price of a home has risen 23 per cent since reaching its cyclical low in January 2009.
British Columbia and Alberta homes are the most overpriced, at 25 per cent above their fair value. CIBC establishes what it calls fair value from market fundamentals that include income, rent and demographic changes.
“This doesn’t mean that house prices are going to crash tomorrow,” said Benjamin Tal, senior economist with the bank. “I’m saying they probably will go down by five per cent or 10 per cent…”
Housing prices set to fall: CIBC
Home ownership costs to rise in Canada: RBC report
Filed Under Main Content · Tagged: Benchmark, Bungalow, Canada Vancouver, Condominium, Economics Research, First Quarter, Home Ownership Costs, Household Income, Housing Affordability, Interest Rates, Percentage Point, Percentage Points, Rbc, Rose, Straight Quarter, Townhouse, Vancouver Canada, Vancouver Sun
Vancouver Sun- Home ownership costs in Canada rose for the third straight quarter in early 2010, and those costs are going to get higher as interest rates rise this year, according a housing report released Tuesday by RBC Economics Research.
The RBC Housing Affordability measure, which identifies how much pre-tax household income is needed to own a home, rose nationally across all housing types in the first quarter of 2010.
The detached bungalow benchmark measure rose by 0.9 of a percentage point to 41.1 per cent, the standard townhouse inched up by 0.4 of a percentage point to 33 per cent, the standard condominium climbed by 0.5 of a percentage point up to 28.2 per cent and the standard two-storey home increased by 0.6 percentage points to 46.8 per cent…
Home ownership costs to rise in Canada: RBC report
New rules cuff some mortgages to banks
Filed Under Main Content · Tagged: Canadian Banks, Canadian Financial Institutions, Consumers, Fixed Rate Mortgages, Gross Income, Headlock, Interest Property, Mortgage, Property Taxes, Variable Rate Mortgages, Wrestling
The Gazette- A headlock would be the wrestling term to describe the hold Canadian banks will have on some consumers because of new, more strict mortgage rules.
We are already seeing the impact of the changes that came into effect on April 19, but were put in place well in advance by Canadian financial institutions. Consumers are increasingly selecting fixed-rate mortgages of five years or more because it’s easier to qualify for them.
On mortgages for terms of four years or less, including variable-rate mortgages, consumers must be able to pay based on the five-year fixed posted rate, which is now 6.1%. Go longer and you can use the rate on your contract, as low as 4.6%. No more than 32% of your gross income can cover principal and interest, property taxes and heat…
New rules cuff some mortgages to banks
Home forecloses don’t add up
Filed Under Main Content · Tagged: Budget, Credit Counseling Service, Durham Region, Executive Director, Failure, Financial Situation, Incidentals, Loans, Math, Mortgage, Rsquo, Sandra, Sherk, Sums, Track Expenses
Financial Post- Why do people default on mortgage and other loans? It turns out that it’s not so much the amounts they owe, but that they are unable to do the math that tells them exactly what their financial situation looks like. Lack of ability to add turns out to be a cause of many consumer insolvencies.
The damage caused by failure to do sums becomes evident when people find themselves in credit counseling.
"The common characteristic of people in serious debt is that they don’t know how to budget or track expenses," says Sandra Sherk, executive director of the Credit Counseling Service of Ontario’s Durham Region. "They let what they owe and incidentals get ahead of them…"
