As the federal government warned it may again tighten mortgage rules, a Bank of Montreal Economist says fixed mortgages “clearly trump” variable mortgages in today’s economy.
There are two reasons for the change of heart by Douglas Porter, Deputy Chief Economist at BMO: the intense competition among lenders and the economic recovery in the US.
“While we have in the past supported going variable, and even though short-term rates are likely to remain low this year, current offers on long-term mortgage rates and the recent shift in bond market sentiment tilt the balance heavily in favour of locking in at this stage,” wrote Porter in a report, Time to Say Goodbye to Variable.
With policymakers warning about rising household debt levels, a new survey shows that Canadians are both worried about what they owe, and in denial about how their debt compares to those around them.
The seemingly contradictory conclusion was reported on Monday by the Toronto-based online mortgage comparison service RateSupermarket.ca, which polled nearly 3,000 Canadians across the country about their feelings on household debt.
Despite the fact that 60.1% of respondents said they were not comfortable with their current debt levels, the majority – 50.3% – also believed their debt levels were below average.
A similar pattern emerged on credit cards. Plastic was by far the leading cause of debt concern among respondents, at 38.8%, with more than a quarter indicating that they owed more than $5,000 and nearly 10% owing more than $10,000 on their cards.
When I logged on to check my bank balance the other day, I noticed a message from the bank saying that I have ‘earned’ a one month mortgage payment vacation.
The reason for this break is that I have been paying off my mortgage faster by making increased contributions each month. My goal is to pay off our mortgage in less than 15 years, rather than the usual 25 or 30. If you do this, most banks will give you the option to skip a mortgage payment once your extra contributions add up to a full months’ mortgage payment.
Taking a break from paying your mortgage can give you some breathing room if you lose your job or decide to stay home with a new baby. But if you’ve been making extra contributions to your mortgage with the goal of paying it off sooner, skipping a mortgage payment will put you right back where you started.
A monthly measure of Canadian home prices showed that year-to-year gains continued in January, albeit at a slower pace than in December.
The Teranet-National Bank house price index was up 6.5% from a year earlier. That was down from 6.8% in December.
While the index showed some slowdown in the rise of prices, it was still “surprisingly large,” said National Bank Senior Economist Marc Pinsonneault.
“If such increases were repeated over the next months, the federal government might react with stricter mortgage rules,” a possibility that has already been suggested prior to Thursday’s budget release, he said in a research note.
Realtors are pushing for air quality standards to fill a regulatory vacuum involving former marijuana grow-ops put up for sale.
How to protect the health – and the investment – of homebuyers is just one of the issues delegates from the real estate industry, civic authorities and law enforcement, will discuss at a three-day conference that opened in Banff, Alberta Tuesday.
“There’s no way on Earth we’ll be able to manage the scope of this problem without the involvement and cooperation of the private sector,” said Staff Sgt Tom Hanson of Alberta Law Enforcement Response Teams (ALERT), a provincial umbrella organization of 400 investigators that targets serious and organized crime.
In 2010, ALERT seized 100,615 marijuana plants and 655 kilograms of harvested bud – much of it grown in operations concealed in homes.