Victoria housing starts also down due to lack of multi-family projects.

Travis Archibald, senior market analyst with CMHC says Everything has been pretty slow across the Island over the first few months, but he’s still optimistic about the summer and fall months having seen what’s on the books, has been approved and what’s in the planning stages

As seen in the Times Colonist

Homebuilding in Greater Victoria was down 24 per cent over the first four months of 2011 compared to the 10-year historical average, says Canada Mortgage and Housing Corporation.

A combination of fewer multi-family developments breaking ground and uncertainty over the fate of the harmonized sales tax appears to be behind the sluggish start to the year.

“Everything has been pretty slow across the Island over the first few months, but I’m still optimistic about the summer and fall months having seen what’s on the books, has been approved and what’s in the planning stages,” said Travis Archibald, senior market analyst with CMHC. “But again, the biggest factor is on the multi-family side – any one project can have a big impact on the numbers and right now we haven’t seen much in terms of apartment and townhome starts this year.”

There were 445 total housing starts over the first four months of the year in Greater Victoria, a 47 per cent drop from the same period in 2010. Of those, only 249 represented multi-family starts, a big drop from the 522 multifamily starts in 2010.

In April alone, there were 124 total starts, down 42 per cent from the 213 in April 2010, and there were just 59 multi-family units a 52 per cent drop from the 123 in April last year.

Archibald said CMHC still expects about 2,000 starts across Victoria in 2011 based on continued levels of in-migration and the number of projects in the pipeline.

“Like any business, homebuilding is cyclical but ultimately you will have to build to meet the long-term demographic demand,” he said noting net in-migration to Victoria last year was 6,000. “As long as people keep moving here we will need housing.”

But builders are unlikely to get to it quickly until the HST question is resolved, said Casey Edge, executive director of the Victoria branch of the Canadian Homebuilders Association.

“We’re waiting on the [June] referendum to see where that goes,” Edge said.

He noted the tax adds significantly to the cost of a new home priced in excess of $525,000. Previously exempt from provincial sales tax, those new homes are now subject to the combined HST. Builders expect that could put off buyers.

Purchasers of new homes costing up to that $525,000 threshold are eligible to receive a rebate of 71.43 per cent of the provincial portion of the HST, up to a maximum of $26,250.

But not all developers feel the need to wait.

Chris LeFevre, the man behind projects like the RailYards in Vic West and the Oriental condo development downtown Victoria, said he’s going “pedal to the metal” at the moment in a market he believes will reward the right product at the right price.

“I feel quite optimistic about the marketplace in terms of if you have the right product at the right price and an interesting product there are people out there who are real and tangible buyers,” he said.

LeFevre said the right product is affordable – between $200,000 and $300,000 – not mainstream or ho-hum, and have some edge in terms of location, character or finish. “If you have those ingredients you can do some good business, if you don’t it’s a bit of a slug-out,” he said.

So far Lefevre appears to be winning the fight as he has seven projects either approved or in the starting gate.

He has just sold out the first phase of Bond’s Landing at the RailYards and has started construction of 15 townhomes on the site. His Oriental development on Yates Street is 50 per cent sold, with expectations the residential units will be complete Aug. 1, and all of the ground-floor commercial space has been spoken for.

“This is a very reliable, stable real estate marketplace,” LeFevre said.

However, he admits the HST has had a dampening effect in some respects.

“It has created a psychological barrier,” he said. “The biggest effect is it can cause confusion to a new purchaser and that in itself can cause some trepidation, particularly if that purchaser thinks the HST might disappear (after a referendum).”

But Lefevre said it’s a false “mental block” as even if the HST goes, some form of taxes will remain on new homes.

“It’s not as though the whole tax subject will go away,” he said, noting his company like many others has gotten around the issue by listing units with a price that includes the net effect of the HST.

Edge said there is some good news in CMHC’s latest figures with Langford holding steady as a strong place to build – there were 35 new single-family homes built in the municipality last month compared with 36 at the same time last year.

This article in the Globe & Mail is soooo true.

Save yourself thousands -

Robin Schade, a 25-year-old student and business owner from Calgary, used to pay $122 a month in bank fees and unnecessary insurance. She paid $24.99 for a joint chequing account with her husband, an additional $14.99 on mortgage insurance and $8.99 on rental property mortgage insurance. Her biggest fee was credit balance insurance on her credit card at $73 every month.

Ms. Schade says her financial ‘Aha! moment’ occurred after signing up for Mint.com, a site that automatically gathers all of your transactions and associated costs to give you the big money picture.

“I have never been able to see in one categorized bundle what these [fees] are actually costing me,” Ms. Schade says. She estimates that by simply cancelling unnecessary insurance and switching to a no-fee bank account, she will save more than $1,400 this year.

When your fees (ATM fees, minimum balance fees, overdraft insurance, monthly account fees, etc.) are pulled together and highlighted in one spot, it’s easy to see if you’re paying too much. And if you are, it’s time to switch to a better package or a no-fee chequing account to reduce costs. Switching from a bank account with a $12.95 monthly fee to a no-fee chequing account saves you $155 a year. Let’s say you apply the savings to the minimum payments you currently make on your credit card, which has a $5,000 balance at 11 per cent interest, and you’ve just saved $275 in interest payments.

If your banking needs are different now than they were when you opened your account, there’s likely a cheaper and more fitting account for you. Calling your bank to review account details and monthly fees will determine if you’re with the right institution and on the right plan. Or try searching for the cheapest banking packages based on your monthly activity and financial status at the Financial Consumer Agency of Canada website.

Another unnecessary cost is credit balance insurance, insurance for your card that can protect you in case of unexpected events. If you carry a balance of $5,000, you could be paying up to $50 a month for this insurance. A waste of money, especially if your life insurance plan already has you covered.

Ms. Schade acknowledges she buried herself in insurance costs as a way to protect her family. But with great life insurance, excess insurance on her credit card was a waste of her money.

Your insurance needs, like your banking needs, may also be different today. You could be over-insuring yourself. Enter your info into the calculator here to find out exactly how much coverage you need, or click here to compare coverage costs. Then, call your insurance provider to ensure you’re fully covered for your needs and not paying a cent more than you have to.

After setting up her online account, Ms. Schade says she has never been so excited to create a budget, or so shocked at how much she actually spends on bank fees. If you have an online account, great. If not, tally up monthly banking and insurance totals this week. Once you get over the shock, you can put an end to the unnecessary fees.

Mark Fidgett, Your Vancouver Mortgage Broker For Life

www.notapennydown.com

604-273-2002

Here are some tips to create a captivating kitchen:

You can cut down on visual clutter by removing items you normally store on the counter.  This will help your kitchen look more spacious.

Your eat-in kitchen should have a table and chairs in it.  Buyers like to see an eat-in kitchen, but often don’t have the vision to see it as such without the furniture.

Remove window screens in the kitchen.  Screens take away from allowing natural light inside.  Plus, no one will notice they are missing.

It’s a good idea to keep some toll-house cookie dough on hand, and bake up a few cookies just before a showing…but don’t overdo it.

Keep the exotic spices and fish to a minimum when cooking the night before a showing.  Work towards achieving a “clean” smell.

Thoroughly clean all your appliances and cupboards, including the inside of your oven and microwave.

Set the dinner table with your best china to stimulate your buyers’ imagination of the dinner parties they’ll host.

Many buyers will look inside your cabinets, so make sure the inside is organized and clean.  Also store non-essential items elsewhere to make the cabinets look more spacious.

Clean as much as possible off the countertops.  Items such as the coffeemaker, toasters, can openers, salt and pepper shakers, recipe boxes, and dish draining rack can be put away.

Make sure that your counter is spotless and shiny.

If you keep fruit or flowers on your counter, be sure they are always fresh.

If your cabinets show wear and tear, you might want to paint them.  A simple trick to update the look of your cabinet doors is to replace your current knobs with new ones.  It’s much cheaper than getting a new kitchen, and it sure can make a difference.

Shine your faucets and knobs and use spot remover to prevent water spots.

Remove notes, pictures, and coupons from the refrigerator door.

Empty your trash cans.  Garbage and recycling bins must be out of sight.

You may want to make your home more attractive by having us approve a rate hold on the home you’re selling.

That way if rates rise, your buyer gets a lower rate!

Mark Fidgett
Vancouver Mortgage Broker
Owner www.NotaPennyDown.com
604-273-2002

The second tactic is to outperform the market. This means ensuring your property increases in value at a greater rate than those in your surrounding market. One way to do that is through renovations – but not all projects are created equal when it comes to generating a return on investment (ROI).

Here are the top four “renos for ROI”:

1. Building an income suite (also knows as a rental suite)
This is by far the most profitable reno a homeowner can undertake. You may want to look into refinancing. I think you’ll agree with me that taking cash out of your home to build an Income suite that typically has a 150% to 250% ROI sounds better than most major investments out there.

2. Painting
This is an inexpensive way to freshen up a property. Picking neutral tones and doing a good job are key. Ask me about a referral for this job. This simple reno project can give a 100% ROI.

3. Renovating Kitchens and bathrooms
Kitchens should be bright and spacious with a smart layout. Replacing old appliances with inexpensive and more efficient newer ones also adds a lot of appeal. Bathrooms are equally important. The more you have, the better the ROI. This delivers about 75% to 100% ROI.

New Flooring
This has a dramatic impact and hard surfaces are the way to go. Laminate flooring is inexpensive, easy to lay, durable and looks great. With modern styles and improved design, it has become the flooring of choice for real estate investors. New flooring can generate an avg. of 70% to 90% ROI.

Quickly fill in an application here and we can get you approved before the new limiting mortgage rules come into affect March 18, 2011.

Mark Fidgett
Vancouver Mortgage Broker
Owner www.NotaPennyDown.com
604-273-2002

Re: Amendments to the Strata Property Act Concerning Rentals Announcement

There has been a shortage of rental units for years in British Columbia. In order to address this, the Provincial Government recently passed legislation dealing with the rental provisions of the Strata Property Act (“SPA”).

Under the old section 143 of the SPA, a rental restriction bylaw passed by a Strata Corporation did not apply to that strata lot until the strata lot was conveyed by the first owner after the developer or until the date that the rental period disclosed in the Rental Disclosure Statement expired, whichever was earlier. Essentially the first owner was always able to rent out the strata unit until the expiration of the rental period disclosed in the RDS, but not subsequent owners.

Pursuant to the amended Section 143 of the SPA, for a new RDS filed after December 31, 2009, a rental restriction bylaw will not apply to that strata lot until the date that the rental period disclosed in the RDS expires. This expiration is usually a long time away: perhaps 99 years or even indefinite.

Therefore, practically speaking, starting January 1, 2010, a new RDS will benefit every subsequent owner of that strata lot rather than just the first owner after the developer. All future owners will be able to rent the strata lot without being subject to any rental restriction bylaw for as long as the rental period disclosed in the new RDS allows them to.

This does not apply to strata buildings where the RDS was filed prior to Dec. 31, 2009.

COMMON QUESTIONS

Several questions regarding the recent changes to the Strata Property Act and rental units. Below is a summary of the questions and answers.

What is a “RDS”? -
“RDS” is the Rental Disclosure Statement that is filed as part of the Disclosure Statement. Developers are required to provide a Disclosure Statement every time they sell 5 or more units, and a Rental Disclosure Statement is part of the Disclosure Statement.

How does this affect a buyer acquiring property already tenanted from original owner –
It does not. The recent changes to the Strata Property Act only apply to Disclosure Statements filed after Dec. 31, 2009. There is no change for units in which the Disclosure Statement was filed prior to that time.

Does this mean that any new strata filed after January 1st of 2010, does not have the power to enforce rental restrictions?
This is correct only if the Rental Disclosure Statement reserves the right to rent for a period of time (which most do).

Developers may choose to file a RDS that prohibits rentals and in such a case, rentals shall not be allowed.

Does this apply only to No Rental restrictions or what about where strata set up a maximum number of units to be rented?
As stated above, the changes have nothing to do with existing units, so current No Rental Restrictions are in effect and
remain so.

Most every form ‘B’ says nothing about a date?

It is the Rental Disclosure Statement that is relevant, not the Form B.

Mark Fidgett | 604-273-2002

“Your Personal Mortgage Consultant….For Life!”

PS – Please Don’t Keep Me a Secret

A REFERRAL is when you INTRODUCE someone you care about to someone you TRUST!

T 604.273.2002 | F 604.522.2072

W http://www.notapennydown.com

An independent Mortgage Specialist associated with the Verico Mortgage Network.

Foreclosure scares people because it means they may lose their house. But if you face foreclosure, you may still be able to help yourself if you understand what it is and how it works. Call me at 604-273-2002

What is foreclosure?
Foreclosure is a legal action that a lender can take if a person who borrowed money using a mortgage stops paying back the mortgage. Foreclosure allows the lender to take or sell the person’s house by first getting a court’s permission to do so.

What happens if you miss a mortgage payment or make a late payment?
You do not automatically lose your house. Lenders don’t want to foreclose if they don’t have to because it is expensive and takes a lot of time. A lender will probably not start to foreclose until two or three months after you stop paying. Normally, a lender will first send letters demanding payment. Then, if you don’t reply, the lender will usually start to foreclose and sue you at the same time.

If you have a short-term problem, like a temporary layoff, you may be able to make a deal with the lender to make smaller payments for a time, and add the amounts you fall behind to the total amount of your mortgage. Or you may be able to make smaller payments for a while and a larger catch-up payment later. Most lenders would rather make some sort of deal and keep the mortgage in good standing, instead of starting expensive foreclosure proceedings in court.

The law tries to help you if you have a good chance of paying what you owe and if you try to get your finances in order. Only in the worst case may you lose your house and any “equity” you’ve built up in it. Equity is the amount that your house value exceeds your mortgage loan and any other debts that other lenders have registered against your house.

If a lender starts to foreclose, what happens first?
The lender first applies to court for an “order nisi”, which is the first order of foreclosure. If there’s a Supreme Court Registry where your house is located, the lender has to start proceedings there, unless you agree otherwise.

You get a document called a “petition for foreclosure”, which is the lender’s application to the court. At the same time, the lender may also sue you in the same court proceeding for the amount of the mortgage that you still owe.

You must file a document called an “Appearance” within seven days of getting the petition
You can get an Appearance form from the court registry. You must file the Appearance at the court address shown on the petition. Once you do this, no one can take any steps in the foreclosure without notifying you. If you don’t file an Appearance, the foreclosure will go ahead without you, and you won’t be able to protect yourself. After you file the Appearance, you will get a document called a “Notice of Hearing,” which tells you when the lender will ask the judge for the order nisi to start the foreclosure.

What happens at the hearing?
The court will give the lender an order nisi, but in most cases, it will also give you time to “redeem” the mortgage by paying the full amount you owe, plus interest, costs and taxes. This time is called the “redemption period” and it’s usually 6 months. But sometimes the lender will ask the court for a shorter redemption period. The court can make an order to sell your house at any time, including at the order nisi stage.

So one good reason to attend the court hearing is to ask the judge for as much time as possible to get the money to pay off the mortgage or sell the house. If you need more time, you can ask for an extension. If you ask for a long redemption period or an extension, the court will want to know what you have done to pay off the mortgage and what chance you have of paying the mortgage or selling the house on your own or through your own real estate agent. You should use a lawyer in this case because a lawyer can advise you on your options, including possible refinancing, even with another lender.

When the redemption period ends, the court can give the lender a final order of foreclosure – see “order absolute” below. Or, the lender can ask the court for the right to have their own real estate agent list your house for sale. If there are other people or companies with a charge against your house, besides the lender who started to foreclose, they may ask for the right to sell your house. If the court gives the lender or anyone else the right to sell your house, it gives them “conduct of sale.” If this happens, you cannot sell the house yourself. If anyone asks the court for conduct of sale for your house, you should ask the court to give you exclusive conduct instead. This means that only you are in charge of selling it. Or you can ask the court to give you at least joint conduct with the other person or company, so you have some control.

You can do two things during the redemption period

1. You can pay off the lender that started to foreclose. To get the money for this, you can try to borrow from another lender or a relative, at a lower interest rate or over a longer repayment period. That would let you pay off the first mortgage and lower your monthly payments. Call me at 604-273-2002
2. Your can try to sell the house, preferably using your own real estate agent. Call me for a referral to a GOOD real estate agent. You may then choose the realtor you trust the most or feel most comfortable with. If you sell the house, you can use the money from the sale, first to pay any tax you owe, and then to pay the mortgage and other charges registered against the title, including court costs. If there’s any money left over (equity), you keep it. But if the money from selling your house doesn’t completely pay off all of the lenders, you may have to pay them the difference. Meanwhile, if the lender or anyone else with a charge against your house gets an offer to buy your house, they can apply to court for an order authorizing that sale.

What if you have no equity in your home?
If you owe more than you can sell the house for, you will probably want to get out of the situation with as little expense and trouble as possible. But you should still take action instead of ignoring the problem. You may want to work with the lender to minimize costs by agreeing to the foreclosure. Normally, you would only do this if the lender will give you a full release from your mortgage, meaning you won’t owe the lender any more money. If the lender won’t agree to this, you can just let the foreclosure proceedings go ahead and use the time as a rent-free period to get your finances back in order. If any other people or companies with debts registered against your house are not paid from the money from selling your house in the foreclosure, you will still have to deal with them. Otherwise, they can sue you for any money you still owe them.

The lender can apply to court for an “order absolute”
The final order for foreclosure is called an “order absolute,” and it comes after the redemption period ends. If the lender applies for an order absolute and the court grants it, the house then belongs to the lender and you have to leave it. You lose all rights to the house. You will no longer owe the lender any money, but if anyone registered a debt against your house after the mortgage, you’ll still owe that money. In exceptional cases, you can apply to the court for relief from losing your house if you can pay the balance in full. Then the court can order the lender to transfer the house back to you.

If the court makes an order absolute, you owe nothing more to the lender
If the lender sells your house after getting an order absolute, but doesn’t get enough money from the sale to pay off the mortgage, you don’t have to pay the difference. But lenders do not usually ask the court for an order absolute. Instead, they will usually sue you when they start to foreclose and ask the court for an order to sell your house to pay off the loan. If the money from selling your home doesn’t completely pay off the mortgage loan, the lender can try to collect the difference from you.

What happens if you have a second mortgage or other charges registered against your house?
Any mortgages or charges registered before the lender’s mortgage continue and are still valid. But any that were registered after the lender’s mortgage are cancelled and the holders of those charges lose their security. For example, if you have two mortgages on your house, and the first lender forecloses, the second lender will have to pay off the first lender or lose its security. Then the second lender would have to try to get you to pay its loss.

Summary
A mortgage is a contract to repay a loan, secured with a charge on land. It’s registered against your property in the Land Title Office. If you fail to pay the mortgage, for example, by falling behind in your mortgage payments, the lender may start to foreclose. Then if you can’t pay the mortgage loan in full, either by selling your house or in some other way, the lender can take your property or sell it to pay off the loan.

If you receive a foreclosure petition, get legal advice. It doesn’t cost much to have a first meeting with a lawyer. As well, you should see a lawyer if anyone asks you or your spouse to sign any new documents, because your spouse may not be liable under the original mortgage documents.

You need the Right Advice at the Right Time!

Call me to discuss 604-273-2002

Mark Fidgett | 604-273-2002

“Your Personal Mortgage Consultant….For Life!”

PS – Please Don’t Keep Me a Secret

A REFERRAL is when you INTRODUCE someone you care about to someone you TRUST!

T 604.273.2002 | F 604.522.2072

W http://www.notapennydown.com

An independent Mortgage Specialist associated with the Verico Mortgage Network.

Vancouver Mortgage Broker Mark Fidgett explains High Ratio Mortgages

Banks and financial institutions are not allowed to lend against real estate mortgages unless the down payment is at least 20% of the value of the property.  In order to achieve a higher level of financing, lenders need to obtain mortgage default insurance from one of three institutions in Canada – the Canadian Mortgage and Housing Corporation (CMHC),  Genworth Financial (formerly GE Mortgage) and AIG United Guaranty.   In the event the borrower is unable to pay the mortgage, the lender will be paid by these institutions.

AIG is not widely used due to the financial difficulties experienced by their parent company in the US.

It is the lender’s choice as to which mortgage insurance company to use.   Many lenders have a preference as to which mortgage insurance company to use.

There may be cases where one mortgage insurance company is more suited to the transaction.  For example, Genworth has a more flexible policies for rental suites. Genworth will accept non-conforming basement suites while CMHC will not.

The insurance premiums is computed based on the level of financing, as shown below

Note: premiums are for fixed rate or capped variable single advance mortgages.  Please contact www.notapennydown.com for other types of mortgages..

The cost of mortgage default insurance is paid by the borrower and can be added on to the mortgage amount.    Note that with high-ratio mortgages, CMHC,  Genworth or AIG will do the appraisal so there is no appraisal fees in a high-ratio transaction.

Mark Fidgett | 604-273-2002

“Your Personal Mortgage Consultant….For Life!”

PS – Please Don’t Keep Me a Secret
A REFERRAL is when you INTRODUCE someone you care about to someone you TRUST!

T 604.273.2002 | F 604.522.2072
W http://www.notapennydown.com

An independent Mortgage Specialist associated with the Verico Mortgage Network.