Ottawa tightens mortgage rules

There is a lot to get us thinking today, from real estate bubbles to shopping. Finance Minister, Jim Flaherty unveiled new mortgage rules today that are expected to ripple through the housing market. The new regulations are anticipated to make it more difficult for individuals with limited means to purchase homes, or for that matter, borrow on the ones that they currently reside in.

The adjustments to the regulations by Ottawa’s Flaherty on Thursday will cut the current maximum amortization period of 30 years to 25 years, and put a cap on refinancing loans from the current 85 percent to 80 percent. “This will further reduce the total interest payments Canadian families make on their mortgages, helping them build up value in their homes more quickly, and pay off their mortgage debt sooner,” Flaherty announced today in Ottawa.

Moreover, Ottawa will in addition limit debt payments at 39 percent of income, and end government mortgage insurance for homes that value over $1 million. The new changes are due to take effect by July 9.

“I see it as another move by Ottawa to reinforce cautious lending practices in response to high household debt levels and high home valuations. The change is significant enough to dampen housing demand and credit growth, though we could see a rush to lock in a 30-year amortization while they are still available,” Said Adrienne Warren of Bank of Nova Scotia.

Colour Trend Changes in 2012

If you are in the market to purchase your new luxury home, or have one built, you want the interior of your home to be designed the way you want. This includes the colour. You probably have an image in your mind of what each room will look like. You may have in your mind the exact colour you want for each room, including the walls and ceiling. As in past years, there are certain colours that are available and that are considered hot, or the most in demand. In 2012, it appears that there are new trends in colours and styles to choose from.

The colours that appear to be the most often asked for this year are colours that portray glamour. The new colour trends focus more on a luxury look. The top colours that will be available and most often picked are emerald, ruby, amethyst, sapphire, coral, and deep cream. Some professional designers also believe that colours like grey and beige will also contribute to the mix. Other colours that may be picked include golden yellow, grassy green and soft pink to name a few. Other colours that seem to be a hit are turquoise, cobalt blue, orange, maroon, and fuchsia.

What about materials that are used on the walls? Many people like to add wallpaper or wood panelling to their walls. If this is your preference, you may wonder what the best choices are. Based on user demands, it appears that marble, wood, leather, and wool are the most often chosen. If you like textures, you may find these are ‘in’ this year. The end results for homeowners and those having their luxury home built are comfort, glamour and style.

One great authority on such colours and colour combinations are the experts at Pantone (www.pantone.com). They can tell you what the best colours are to use within a home. If you really want to spice up your home and have it look really spectacular, you should take a good look and see what is available based on a 2012. You just may find it surprising what some of the colours are which can bring out the best in your home.

Once you know the colour scheme you want, all you have to do is simply engage your designer in a conversation about your choice of colours, and he/she will take over and do the rest. Getting the colours right is important. Think how beautiful your home will be once you have selected the best looking and most suitable colours. It only takes a short time to determine the best choice and then before you know it, your luxury home can be complete, with the details the way you want – right down to the colour of the walls and ceiling.

Mortgage Rule Changes May Go Into Effect This Spring

There has been much talk about the government tightening up on mortgage lending by making the qualifications for getting a mortgage tougher. The debate about this possible tightening has become so widespread that it is the number one issue facing all homeowners and future investors. The issue has spawned many public debates. Many of these debates have been over housing valuations. It is no surprise that the Canadian Association of Accredited Mortgage Professionals (CAAMP) has stepped in to make sure the government has all the facts before they decide to make any mortgage policy changes.

The CAAMP had conducted research to determine the state of the mortgage crisis in Canada, and what steps can be done to alleviate it. CAAMP president, Jim Murphy, recently met with Ottawa officials to deliver the research results CAAMP came up with. This meeting was important as it provided the government the information they needed to make a wise choice regarding what mortgage policy changes to make. As a result of this meeting, the government will wait till the spring to make any kind of rule changes.

This decision could change if home prices were to rise strongly during the year. If that were to take place, the government may have to intervene sooner than expected and put in place new mortgage restrictions to curb the rising prices. This action could affect many homebuyers, who are looking to take out a second mortgage, and it also affects new buyers to the market. They may not be able to obtain the mortgage they need, as there would be restrictions put in place. Such action could be detrimental to the home buyer.

CAAMP will continue to take an active role in policy issues that the government evaluates. If at any time changes need to be made, CAAMP will make recommendations to the government, with advice on what changes should be made. As long as housing prices remain stable or should start falling, the need for mortgage policy changes won’t need to be made. Continued monitoring of the housing market will be made to determine when changes need to be made.

If that time should arise when changes have to made, the government, in cooperation with CAAMP and their findings, will take the necessary steps. It is a matter of going forward and making the tough decisions that have to be made.  Rising home prices do not just hurt first time home buyers; they can hurt those who already have a home. Rising prices can hurt the economy as well. This is another reason for monitoring the economy and home prices.

If you look at the stats, housing has about 8% of Canada’s employment. This means that eight percent of the jobs in Canada are based on housing construction. If housing prices were to go up, and reach high levels, this would force people to stop investing in homes, as it would be hardly possible to purchase a mortgage. This would also cause housing construction to slow down or stop. This means a damaged economy. Keeping prices down is therefore the vital factor here.