Housing and Interest Rate Predictions for 2022

Posted on January 12, 2022 by tracyirwin

This we know for sure. For the second straight year despite the COVID pandemic (and all its variants), the Canadian real estate market has continued its upward climb.

real estate mortgage rate predictionsThe Canadian Real Estate Association predicts that when all the 2021 numbers are in, home sales and home prices will be 21% and 21.2% higher respectively.

CREA also reported that low inventories of homes for sale are expected to keep upward pressure on prices for much of 2022. “While price growth is not expected to be as extreme in 2022, many of the conditions that supported it right up until the end of 2021 will still be there on New Year’s Day,” CREA noted in its housing forecast.

Big 6 Bank Interest Rate Forecasts

(notice the changes in rates compared to my blog of November 9)

Target Rate:
Year-end ’21		 Target Rate:
Year-end ’22		 Target Rate:
Year-end ’23		 5-Year BoC Bond Yield:
Year-end ’21		 5-Year BoC Bond Yield:
Year-end ’22
BMO 0.25% 1.25% NA 1.45% 1.80%
CIBC 0.25% 1.00% 1.75% NA NA
NBC 0.25% 1.50% 1.75% 1.40% 1.90%
RBC 0.25% 1.00% 1.75% 1.25% 1.65%
Scotiabank 0.25% 1.25% 2.25% 1.50% 2.05%
TD Bank 0.25% 1.00% 1.75% 1.35% 1.90%

My Professional Advice Regarding Buying a Home and Mortgage Lending:

  •  Don’t get caught up in the FOMO (the fear of missing out)! It may be in your best interest to wait until 2023 to buy. Let’s talk about what is the right decision for you!
  • Make sure you have mortgage preapproval so when the right house and time comes along, you are ready to put in that offer with confidence!
  • If you have an existing mortgage, you still have to qualify for your new mortgage if you purchase another home (regardless of whether you port your mortgage or not).
  • If you are in the last year of your mortgage and purchase another home, you will have to break your current mortgage. It is a good idea to know the approximate penalty as it may influence your decision on whether to buy before or after your renewal.
  • If you are going on maternity leave, your income will be adjusted to what you will earn while you are on leave. It may impact your income and qualifying mortgage amount.
  • If you change jobs and are on probation, that may affect your ability to qualify for a mortgage.
  • While interest rates are raising, it appears the government is very cautious about raising rates quickly. If your mortgage is renewing this year, some lenders allow an early renew option that would help you lock in at today’s rates. Let’s look at the options!

Remember, expert mortgage advice is available any time! Contact me, Tracy Irwin, Mortgage Broker to set up a time to talk! Feel free to share this information with family and friends… I am here and happy to help!

Cold Hands and Warm Hearts

winter collage

 

 

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Heads Up! Interest Rate Hike Expectations Are Growing

Posted on November 9, 2021 by tracyirwin

canadian loonieCanadian Mortgage Trends recently reported, “With inflation well above the Bank of Canada’s target level and ongoing supply chain issues, expectations of earlier-than-expected interest rate hikes in 2022 are growing.

For much of the past year, the Bank of Canada [BoC] had assured markets that interest rate hikes were off the table for at least the next year or longer. In January, the BoC had said, “We remain committed to holding the policy interest rate at the effective lower bound until economic slack is absorbed so that the 2% inflation target is sustainably achieved…In the Bank’s January projection, this does not happen until into 2023.”

Fast-forward to today, and rate hike expectations are growing by the week, with some seeing the first rate increases by mid-2022.”

Big 6 Bank Interest Rate Forecasts

Target Rate:
Year-end ’21		 Target Rate:
Year-end ’22		 Target Rate:
Year-end ’23		 5-Year BoC Bond Yield:
Year-end ’21		 5-Year BoC Bond Yield:
Year-end ’22
BMO 0.25% 0.50% NA 1.10% 1.35%
CIBC 0.25% 0.50% 1.25% NA NA
NBC 0.25% 1.00% 1.50% 1.30% 1.90%
RBC 0.25% 0.75% NA 1.10% 1.65%
Scotiabank 0.25% 1.25% 2.25% 1.40% 1.95%
TD Bank 0.25% 0.50% 1.50% 1.15% 1.75%

[Source: https://www.canadianmortgagetrends.com/2021/10/bank-of-canada-preview-rate-hike-expectations-growing/]

What this means for you:

  • Higher interest rates mean less money in your pocket for savings, investments, travel, etc.
  • Places even more importance on acquiring mortgage pre-approval. Mortgage pre-approval offers two benefits:
    • You’ll learn the lender’s estimate of your borrowing power
    • In many cases mortgage approval offers you an interest rate hold for up to 120 days in many cases. This rate hold can be a game-changer.

You also have the opportunity to ask for expert mortgage advice any time! Contact me, Tracy Irwin, Mortgage Broker to have a confidential conversation today! Please share this information with family and friends… I am here and happy to help!

The Results: Running For Rachael 2021

running for rachael logoThis year’s Running For Rachael raised $26,509.69 thanks to the overwhelming support of our community and sponsors! A very special thank you to the Hamilton Wentworth Catholic District School Board and students for their incredible fundraising initiatives.

We’re very excited to welcome everyone in person (hopefully) for the 10th anniversary of Running For Rachael on September 25, 2022.

Follow this link to see the 2021 Running For Rachael photo gallery. See you next year!

Memories of Halloween Now & Then

halloween collage

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THINKING About Buying a Home? Get Organized First!

Posted on September 21, 2021 by tracyirwin

where will my down-payment come fromThe moment you start thinking about buying a home is the moment to start thinking about where your down-payment will come from.

Moving all your sources of money for a down-payment into a single “staging” bank account will help. This may take a while, and yes, you’ll lose out on the (puny amount of) interest offered by financial institutions, but in the end, it will simplify and streamline the mortgage approval process AND reduce the paperwork you’ll be required to present. What mortgage approval process? What paperwork?

Mortgage Stuff You Probably Didn’t Know…

You probably don’t buy a new home every year, so don’t be too hard on yourself. Besides, just when you think you’ve got everything figured out, something changes, like down-payment requirements, mortgage stress tests, federal and provincial programs, etc. Ask a Mortgage Broker like me for help.

Why Do Lenders Care About Down-Payment Sources?

Mortgage lenders need to be sure the down-payment is from legitimate sources. Here are four things they are watching for:

  1. Anti Money Laundering (AML). Lenders care about deposits over $10,000 and where they originated.
  2. Sanctioned Countries. Lenders also care about whether the down-payment originated from a sanctioned country.
  3. Tax Avoidance. Lenders want to make sure the cash is from legitimate sources and not ‘under the table.’
  4. Borrowed Money. This often catches borrowers by surprise: The lender wants to know if any part of the down payment or closing costs is borrowed. Repayments change a borrower’s debt service ratios.

Sometimes clients feel this verification process is an invasion of their privacy. I understand. It is the lender’s right however, to ask for all the information they believe is reasonable. Most lenders request a 90-day history, but some will go back further to satisfy themselves that the source of funds is legitimate. Have a mortgage question? Answers await!

Four Typical Down-Payment Sources

  • Personal Savings such as saving and chequing accounts, mutual funds, GICs, RRSPs, TFSAs and stock trading accounts.
  • Gifted funds. Sometimes known as the “Bank of Mom & Dad”. Gifted funds are fine. Family loans, however, are not. They are treated as “borrowed money” (see #4 above).
  • Self-employed. Some applicants rely on money from their business.
  • Overseas Bank Accounts. Or generous family members overseas who wish to help out with gifts (not loans).

Buying a home should be an exciting and rewarding experience. I can help you and your family navigate the mortgage process and move into the home of your dreams. Hop over to my blog for lots more mortgage information and get in touch with me, Tracy Irwin, Mortgage Broker any time.

Running For Rachael 2021

Join us in supporting city-wide suicide prevention with this year’s Running For Rachael on Sunday, September 26th. Register today!

Choose to walk/run with your household, or your team (while maintaining local social distancing rules and public health protocols). Meet Rachael. Learn more. Save a life.

 

 

 

 

 

 

 

 

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Running for Rachael 2021

Posted on September 7, 2021 by tracyirwin

running for rachael logoYour life matters! Join us in supporting city-wide suicide prevention with this year’s   Running For Rachael on Sunday, September 26th. Register today!

Help us Spread the Word

Check out the Running For Rachael Toolkit.

Running for Rachael (RFR) plays a vital role in supporting the city-wide work of suicide prevention in Hamilton by bringing the community together to promote hope, help and healing through crisis support information, training, education and support groups.

Sign up to participate from anywhere and anytime on September 26, 2021. Choose to walk/run with your household, or your team (while maintaining local social distancing rules and public health protocols).

How You Can Help

Create a virtual team with your friends and family or register as an individual and plan to walk/run in your own neighbourhood or make a donation.

There is no cost to register. We encourage fundraising and any donations of $10.00 or more will receive an income tax receipt immediately.

Hope

LivingWorks Start is an online suicide prevention training program that will teach you how to recognize when someone is having thoughts of suicide and take meaningful action to keep them safe.

Help

Be Safe is a free mobile app that offers information and links to mental health, addiction and suicide prevention resources in Hamilton. Download the app on the App Store or Google Play.

Healing

Support groups for those who are bereaved by loss due to suicide.

Running for Rachael is brought to you by the Suicide Prevention Community Council of Hamilton and is a community 5K Run/Walk taking place on September 26th, 2021.

Let’s walk or run for city-wide suicide prevention in Hamilton.

This is Rachael.

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Changes to Stress Tests for Insured and Uninsured Mortgage Financing

Posted on June 9, 2021 by tracyirwin

Follow the Leader…

follow the leaderStarting June 1, both insured and uninsured mortgage borrowers are subject to a stricter stress test when qualifying for their mortgage. The Office of the Superintendent of Financial Institutions (OSFI) confirmed that it has moved ahead with its stress test changes which apply to uninsured mortgages (typically those with more than a 20% down payment).

Soon after, the Department of Finance confirmed it is following OSFI’s lead, and applying the same higher qualifying rate to insured mortgages, or those with less than 20% down. In both cases, borrowers will need to prove they can afford payments based on the higher of the contract rate plus 2%, or a new base rate of 5.25%, up from the current 4.79%. Read the article…

Who is Impacted?

Applying the modified stress test to insured borrowers will impact roughly 1 in 5 mortgage borrowers, according to data from the Bank of Canada. It also takes direct aim at first-time borrowers who are more likely to be putting less than 20% down on a mortgage. Need help navigating the mortgage process? I’m a here for you as an advisor and trusted Mortgage Broker. Let’s talk today.

Ahhh… the Great Outdoors!

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Did You Know: PRE-Approval Does Not Guarantee a Mortgage Approval?

Posted on May 12, 2021 by tracyirwin

scorching real estate market

In this scorching hot sellers housing market, it’s important to know that a pre-approved mortgage does not automatically become an approved mortgage when you submit an Offer to Purchase.

In the past, buyers included a “conditional on financing” clause – but in today’s extremely competitive real estate environment, many (especially first-time home buyers) are opting to eliminate all conditions, leaving them at risk.

There are several important factors considered during the mortgage financing approval process. Do you know what they are? Read the article…

If you would like to learn more about mortgage financing, let me know! I’m here to help you achieve your goal of intelligent home ownership.

Family Magic

tracy's family pictures

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The Good, the Bad, and the Awesome in Mortgage News…

Posted on March 10, 2021 by tracyirwin

great news for mortgage financingThe Good:  It’s hard to believe that anything good could come out of the COVID-19 pandemic – and yet – a new analysis by rate comparison site Finder has found that Canadians saved approximately five times more of their disposable income in 2020 compared to 2019.

Smart homeowners are using these savings to their advantage for prepayment privileges or increasing their down payment amount on that new home. Read the article…

The Bad:  The Bank of Canada is ending one of its emergency measures to stimulate the COVID-19 economy, leading to speculation that the era of record-low mortgage rates could be ending, too. The Financial Post article from February 1 reports, “Lenders had it good, but the central bank stops buying Canada Mortgage Bonds on October 26”. Read the article…

The Awesome: Get your FREE copy of Preserving Wealth: The Next Generation by Jack Lumsden, MBA, CFP.

Take the first step… talk to me about all your mortgage financing needs today.

The Best:

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Feel Like You’ve Missed Your Opportunity to Buy a Home?

Posted on January 13, 2021 by tracyirwin

Based on consumer surveys the answer is a resounding NO!

What You Should Know About Homeownership in 2021:

Tracy Irwin opening doorsWe know economic forecasting in this rapidly changing COVID-19 environment is impossible because of extreme uncertainty related to key factors that drive consumer decisions (think employment).

As an alternative, Mortgage Professionals of Canada has released quarterly updates on Rapidly Evolving Expectations in the Housing Market, the latest edition being December 2020. The report includes new data based on shifting attitudes and expectations about the housing market. So what do Canadians think?

Let’s talk about mortgage financing for your dream home! Connect with me today!

New Resource: Your Financial Toolkit

The Financial Consumer Agency of Canada has released a series of free e-learning tools designed to help adults manage their personal finances and gain the confidence they need to make better financial decisions. The self-paced learning modules include topics such as budgeting, saving, credit management, mortgages, investments, and fraud protection. Here is the link: https://www.canada.ca/en/financial-consumer-agency/services/financial-toolkit.html

Making the Best of a COVID Christmas!

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Homeownership Sentiment During COVID-19

Posted on November 11, 2020 by tracyirwin

home protected by gloves and maskOne of the reasons mortgage professionals study economic trends is that, most of the time, the recent past gives us reasonably reliable clues about what might happen in the near future.

That is definitely not the case this year. The COVID-19 pandemic has resulted in extremely volatile shifts in the Canadian housing market and that has made it impossible for anyone to confidently develop forecasts for the housing market.

Mortgage Professionals Canada has released 3 of 4 reports – Rapidly Evolving Expectations in the Housing Market, written by Chief Economist Will Dunning. These reports track shifts in Canadians’ expectations about the housing market in order to monitor the evolving market circumstances.

Is it your time to buy a home? I’m here to answer your questions and find the right mortgage financing for you! It only takes a minute to get started.

The Perils of Dying Without a Will

Only 51 percent of Canadian homeowners reported having up-to-date wills. Thirty-six percent reported not having a will at all. These statistics beg the question, “Do you know what happens to your home if you pass away without a will?”

Recent data (from Angus Reid and Willful) suggests a shocking lack of knowledge among Canadians when it comes to dying without a will. Only 21 percent of those asked the question, got it right – your home will be distributed to an individual’s dependents according to a provincial formula. The other 79 percent included people who mistakenly think their properties will automatically go to their spouse or children (48 percent) or to the government (6 percent), while 24 percent admitted they don’t know.

I work closely with lawyers and financial planners and would be happy to recommend someone to help you protect your home, your family, and your estate. Email me today so you can enjoy peace of mind! After all, we have enough to worry about right now.

Tracy’s Adventures

tracy in owen sound and lion's head

Dressing Up for Halloween…

 

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Running for Rachael: The Results

Posted on November 10, 2020 by tracyirwin

running for rachael logoWe are thrilled to report that we raised just over $26,000 this year at Running for Rachael, not far off the $30,180 we raised last year.

We feel so blessed by the support of the community during this difficult time! Everyone was physically distanced for the event. You can watch the launch video here. It’s quite something! And check out our Facebook page to see all the photos.

It’s so heartwarming to see our grandchildren continue supporting our work.

Learn more about Running for Rachael. Enjoy these happy snaps of event day!

 

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