Saturday, 17 November 2012

Is it still the good time to buy in this market?  I have been asked this question so many times recently.
We are going to enter the winter season. Some people think that the real estate market is going to be the same ‘ cold ‘ and may be ‘frozen’ as said by some of the media . People always forget that the real estate is cyclical in nature; its price will not always go up or never ever just dip down. However in the long run, the property value always appreciates. Real estate is the most practical and common means to build up one’s own wealth, and a more secure and safety investment for average people.

 To get the best possible deal, some people try to time the market relentlessly. It is virtually hard to time the market; the buyers who sit on the fence for years waiting for the big drop find themselves still waiting on the same spot. They are just too scared to make the decision even the price really drops in the aftereffect moment, like the time in 2008 during the financial crises, those home buyers who made the purchase have had the average home value increased by 30-50 % easily.  Those who didn’t may just still keep paying their landlord and complaining that the price is too high year after year.

 Time has tested that when people look back, they always find the home price so cheap back to 10 – 20 years ago but the buyers in that period of time also find the price mostly too high to afford.   It is really hard to time the market at the rock bottom or high peak, however there is some moment of time in the year that the buyer can get the benefit by acting in time, of which the right time is the winter time. 

It comes to be truer in this winter particularly and some obvious benefits can be listed as followings:

1.       The market become slow, you don’t need to bid over with multiple, several to ten or even twenty other buyers on the same house and find yourself being banned and frustrated.

2.       The seller is more apt to reasonable price and motivated to sell

3.       Not many buyer compete with you, and you may come across a great deal

4.       The weather   may be not so pretty looking than the other season period,  but that allows you more time to hunt for your dream home  because less of buyer coming out to do the same.

5.       The market slowing down  after a crazy price escalating  is a normal pause and it is not a sky falling or market collapse , on contrary it is a  platform base for further build up on next wave as long as the fuel is still there. So take advantage of the moment to achieve the pride of home ownership and being proud of it if it is your goal.

6.       The mortgage rate is still crazy low. To keep it being low to fuel the economical power is the policy that the government will not and cannot get rid of it abruptly in the near future.  By the same time of the tightened mortgage rule, the government is making the real estate to grow in a healthy way and the real estate will not crash as some doomsayer stated.

7.       Take advantage of the low mortgage rate when you are qualified.  An increase of half point of interest rate will reduce your buying power at least 5.5 %, or you will qualify less $26k on the purchase of the home based on $500k home. If you wait for price to decline, the perceived value can be lost due to higher rate. Ironically you may not be able to afford to buy even the price declines.
In conclusion, the buying frenzy of multiple biding is basically over in the moment. The dust has settled and buyer has a normal amount of breathing room to hunt for their dream home.  Take up the advantage right now before it is too late.

 For further discussion, please contact Dennis Ho, Broker   email:

Homelife Gold Pacific Realty Inc., Brokerage. Independently owned and operated.
This is not meant to interfere representation or agency under contract with other Brokerage.

This article is not intended to be formal advice of any kind. No one should act, or refrain from acting, based solely upon this or any other general information without first seeking appropriate professional advice


Saturday, 27 October 2012

Additional policy change to mortgage application

Effective October 31, 2012, additional policy changes :

Equity Lending Changes

 Maximum 65% LTV will now apply to all Business for Self and New immigrant applications. no exception and confirmation of business is required regardless of LTV

Qualifying Rate Changes for Conventional Mortgages

Closed Variable Interest Rate Mortgages and Fixed Rate Mortgages terms LESS THAN 5 years – the greater of the Bank of Canada 5 year benchmark rate or the customer rate will be used as the qualifying rate

Fixed rate mortgages with terms equal to or greater than 5 years - the actual customer rate will be used as the qualifying rate

Applications submitted before October 31, 2012 will be adjudicated using the current qualifying rate policy

You may need to look at it closely to see how big the impact to hit on you if you are self employed

Saturday, 30 June 2012

New Mortgage rule from July 9 2012

You may hear enough there is a new rule coming effetive from July 9, 2012, but you are not sure how it may affect you and what is changed.

Followings are the summary of those changes mandated by the Department of Finance, Canada:

Maximum Amortization Available for Default Insured Mortgages
The maximum amortization for default insured mortgages will be reduced to 25 years (previously 30 years)

Maximum Amortization Available for Uninsured Mortgages
The maximum amortization for uninsured mortgages remains 30 years

Maximum Purchase Price for Default Insured Mortgages
In order to qualify for a default insured mortgage, the purchase price must be less than $1 Million

Maximum Loan-to-Value Ratio (LVR) for Refinances
The maximum LVR for the refinance of an owner occupied property will be reduced to 80% (previously 85%)

Approvals – for Default Insured Mortgages Only
The following guidelines are based on the date the application was first received by the Default Insurer:
* Submitted on or before June 21, 2012.   All loans qualify under previous guidelines
* Submitted between June 22, 2012 and July 8, 2012
    • Purchases:  Where a legally binding purchase and sale agreement was signed between June 22, 2012 and July 8, 2012 inclusive, 30 year amortization is available.  These loans must be funded by December 31, 2012
    • Purchases:  Where a legally binding purchase and sale agreement was signed June 21, 2012 or before, 30 year amortization is available.  No restrictions apply to the funding date
    • Refinances:  Where a refinance is submitted between June 22, 2012 and July 8, 2012 inclusive, the maximum loan-to-value ratio of 85% and 30 year amortization is available.  These loans must be funded by December 31, 2012
* Submitted July 9, 2012 or after. New rules apply

All amendments to existing approvals issued by a Default Insurer with a binding purchase and sale agreement dated before July 9, 2012 will be considered on a case by case basis by the individual Default Insurer

Pre-approvals for Default Insured Mortgages
A mortgage pre-approval without an agreement of purchase and sale is not sufficient to qualify for a 30-year amortization.  In order to qualify for a 30 year amortization, the purchase and sale agreement must be dated before July 9, 2012 and the mortgage insurance application submitted before July 9, 2012.

Straight Switch/Transfer from other Financial Institution – Mortgages with remaining amortizations greater than 30 years may be transferred as long as existing mortgage terms are retained

For any question, please contact Dennis Ho  email:

Thursday, 21 June 2012

why it is still a good time to buy

When the media says that the real estate is going to be a bubble burst and falling down of 15 percent in coming year. The market  in reality does not show any slowdown at all. I think there are still some very good reasons for you to jump in the market.

1. The interest rate is still historical low.

2. The affordability is still within the healthy range

3. Toronto is a great city where hundred thousand of  immigration want to live in
4.  Real estate is a long term disposition.
5. If you can afford to pay .