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Mid-Island Mortgage & Savings Ltd. & the Christmas Angels…

Why Budget?

Everyone knows, the cost of living has increased.  Going to the grocery store, the gas pump, or a trip or to the movies all costs more. While there isn’t much that can be done about that in the short term, what is in everyone’s control?  Budgeting.  Work with what you have to help make your finances align with your goals.  You do not have to break the bank this Christmas.  Read through some of our budget tips on how to live within your means. 

Why is it important to set a budget? Spending can get out of control to the point where you may not even know where your money is going.  You may not have any savings plan in place.  Do you want to start saving for a down payment on a house, or to complete some renovations?  Maybe you’re noticing your credit card bills getting out of hand.  The Christmas season puts added pressure on bank accounts, but it doesn’t have to.  Now is the time to pay more attention to your bank account and spending habits.

By creating a budget you can save money, pay down debts, reduce your stress, have more control and have money to do the things that are truly important to you.  Who doesn’t want to live within their means?  

Budget Tips:

Create a Budget

The sooner you create a budget the sooner you can start improving your finances.  Look at your net monthly income, account for expenses are mandatory, and identify any leaks where money seems to be slipping away.  

Free Monthly Budget Tool 

Christmas spending limit

Do not go overboard with gift buying this year.  Get together with family to change how you do things, have a draw for family or friends so you only have to buy for one person.  Rather than an expensive gift exchange, make homemade gifts or do a whacky $10 gift exchange.  Don’t give into pressures of the season, it’s more important to be true to your values than to get the biggest best gift.  Remember what’s truly important to you when it comes to the holidays and focus on that.

Multiple Accounts

Have multiple bank accounts-ensuring that you have a designated spending account will act as your allowance for any discretionary items.  Allocating another account where payments come out on a regular basis means you can set it and forget it. Once you’ve determined how much is going out of that account each month, you know how much to put in and subsequently you can alleviate stress.  It goes without saying, one of these accounts needs to be for Christmas if you intend to spend money around the holidays.

Automatic Transfers

Set an amount that will transfer to your savings each payday.  This can be as low as $25 to get you started and in the habit of saving.  If you have a goal you are saving towards, work backwards. Figure out when you need the money, divide it by how many pay cheques you have until then, and set up your transfer for that amount.  Then when that trip to Mexico comes up, or your hot water tank goes, you’ll have the funds on hand. This will once again reduce stress. 

Emergency Savings

It’s said to have at least 3-6 months worth of expenses in a savings account. For those who aren’t already savers by nature, that can be a daunting number.  Especially when the cost of living has risen so significantly, and ‘extra’ money may seem like a pipe dream.  Start by saving $500 to $1000 as quickly as you can. This can sit in a savings account that is accessible, and can assist in a true emergency should it arise. This could help reduce anxiety if something comes up, and mean you won’t have to rely on credit as heavily.

Allowance 

Give yourself an allowance-really!  Once you have all your monthly expenses set, you know what you’ll be able to put into savings. Provide yourself an amount that can be used for your discretionary spending, could be going to the movies, dinner’s out, or grabbing a fancy coffee.  Don’t make your budget so strict that there isn’t any fun.

Getting Help

Creating a budget is a really great starting point– but getting the help of a professional is a good idea.  A mortgage professional can review your mortgage and other expenses to see if they can help you save money.  Don’t have a mortgage? They can also help get you on the path to home ownership by helping to determine what steps you need to take.    

 

Free Monthly Budget Tool

https://docs.google.com/spreadsheets/d/1l2NNg1PHKJwUROjhObANsiML09u8ZUUpDBHWA8FpK3c/edit#gid=0 

 

Subprime vs Traditional Lending

 

Coming from a traditional lending background, I’ve often thought of mortgage lending as a puzzle. In order to help the client, every single piece is necessary to get them what they need.  Credit has to be solid, the income both consistent and sufficient, the security (house) had to be in a good location in a decent condition.  All this is required. Without every piece in place, the puzzle just wont work!  The thing is–people’s lives can be complicated, messy even. Puzzle pieces go missing, and some don’t QUITE fit.  

Traditional Lending

Lets explain; Banks, Credit Union’s, and Monoline Lenders (companies regulated by the bank act who offer single products, in this case mortgages) all have to adhere to specific rules set by the Government.  Within those rules, the companies themselves can work with their board, risk management and shareholders to ensure that their best practices are within those rules.  They may decide to assume more risk in one area but less in another. Offering products or programs that target specific audiences. Acting within the letter of the law and their internal policies and practices.  For the most part, doing the same puzzle, with the same pieces.  

Subprime

Subprime, or “B” Lenders, do not have to adhere to the same rules as big banks.  Privately owned, operated and regulated they offer their own unique pieces to the puzzle.  These lenders offer assistance to borrowers who aren’t a fit for the major lenders, so credit issues, self-employment or lack of sufficient income fits for them.  They have more flexibility in how they lend and who they lend to. 

Of course, guidelines are still in place, they merely have more of a landing pad for the “unbankable”.  Anytime a lender is taking on higher risk mortgages, there is a premium for that, and with subprime lenders it translates to higher interest rates than other lenders, and sometimes lender fees.  It would be easy for a person to sit back and form opinions based on the idea that they are charging what they are. Some might say that the people seeking money from these companies “shouldn’t even be borrowing”.

Self Employed

For our self-employed clients, the general rule of thumb is that lenders want to see the last two year’s income tax returns (T1 Generals).  For a self-employed individual, this may not be the most current and accurate version of their finances.  Subprime lenders offer Business for Self programs such as stated income that require the last 6 months of business bank statements to support the cash flowing into the company.

Credit Issues

If you go bankrupt or file a consumer proposal you’ll generally be waiting 2 years from your date of discharge in order to be a candidate for a mortgage at a bank or Credit Union.  With subprime lenders, they consider you right away.  Their minimum credit requirements are significantly lower.  Many people may think that once their mortgage is placed with a Subprime lender that they’re going to be with them forever. This is not true.  Often clients will work with their Mortgage Broker to make a plan to make their way back to an A lender.  This could mean a variety of things. A hyper focus on paying bills on time, to earning additional income.  Whatever it may be, you won’t be alone, our Brokers will work with you to set a plan and will continue to check in to help keep you on track.

Stigma

There tends to be a real stigma out there about the Subprime lending world. In a situation where you may lose the house because of lack of income, an illness, a bad relationship or business venture that left you in a tough spot–There are options for you.  Of course the ideal lending situation is to be able to have a mortgage through a major bank, or monoline company. The interest rates will be less and there will be less fees.  No one is disputing that. 

However, in my decade and a half in the finance world to confidently say that there are many of us who “do not make the mark” set by banks.  I feel fortunate to be able to offer people solutions that fit their situation, to meet them where they are.  In many cases the solutions will help them maintain or improve their housing situation, and help their financial situation.

Being a mortgage underwriter at a traditional financial institution for many years, my experience with lending was limited to our own products and services. Helping people to have access to the Subprime lenders gives me the ability to help people work with what they have.  Putting their puzzles together in a way that works for them! 

I am grateful and appreciative of the opportunity to offer mortgage and financing solutions for our clients.  Interested in learning more, or have questions about your own ability to qualify for a mortgage please call or email us.  If you’re buying, renewing, refinancing we would be more than happy to help work with you to figure out your options.

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Fall Update on Mortgage Lending Insights

HOW SOME YOUNG PEOPLE CAN AFFORD A HOME

– HOW SOME YOUNG PEOPLE CAN AFFORD A HOME –

By: Edward Trapunski

We were recently very flattered to be invited to dinner by a young couple that we know. It was the first time that we visited their home and we were overwhelmed by how beautiful it is. Home for them and their two pre-schoolers is on an attractive street in one of the most desirable enclaves in the city.

He’s on leave from his job while he pursues more education so that he can better himself. She has a good job but, as yet, she has no security. It’s scary.

It’s very hard for young people to buy a house, according to what you read and hear. Still, here’s a young couple who own a beautiful five-bedroom, four-bathroom house near a ravine for which they paid $1.2 million. It’s not out of line for Toronto.

Here’s how they managed to do it:

The house they owned previously wasn’t in a nice neighborhood. It was a fixer-upper and they spent the money to have the work done. It was a good investment because they were able to sell their modest first house for considerably more than they bought it for. It helped that housing prices were escalating and the area they were leaving had yuppified.

So it was the first house that gave them the leverage. They had saved up for it. My young friend is a family guy and the prospect of a household full of children was a stronger motivator for him than travelling. He still enjoyed his good seats watching the Blue Jays but he came straight home right after the game. The nest egg my friend and his wife accumulated by being homebodies showed the lenders enough that they were responsible and had no problem shopping for a favorable mortgage.

For that first house they also took advantage of the Home Buyers’ Plan (HBP). The Canadian government allows first-time home buyers to borrow up to $35,000 tax free from their RRSP. If you’re purchasing with someone who’s also a first-time homebuyer, you can both access the $35,000 for a total of $60,000. If you have a down payment of at least 20% of the purchase price of the home, the savings can be significant, and you won’t have to buy mortgage default insurance. Married couples and common-law partners both qualify. However, since the HBP is considered a loan, it must be repaid within 15 years at the rate of at least 1/15 of the loan every year.

My friends also accessed what is colloquially known as the Bank of Mom and Dad. They were lucky enough that both sides of the family were prepared to help them out with the down payment. This isn’t as rare as you think any more. In the 1960s, people usually lived until they were 65 or 70. When they passed away, they’d leave enough in their estate for their children—who were 30 or 35 years younger than them—to use to buy a house. Now that people are living longer, they’re giving their adult children the money while they’re still alive to help them get into the housing market.

Many parents these days are prepared to help their children settle down faster than they could do on their own. Also, with interest rates at such historically low levels, it makes sense to help your children take advantage of a situation that may never come again. Provided it doesn’t jeopardize their own finances or retirement plans, many parents feel a sense of personal satisfaction in making a difference in their adult children’s lives. They also want to ensure that they’ll see the rewards of having a stable life for their grandchildren before they’re gone.

My young friends began with a starter home, as I did. Now they plan to live in their lovely home for the rest of their lives — and they can — so they see it as an important investment for themselves and for their children. That’s why they’re glad they did it.

Have more mortgage questions or concerns? Call our office today at 250 753 2242 and we can help with all of your mortgage questions!

“LIKE” our Facebook page or “SHARE” this post to be entered into our quarterly draw for a $150.00 gift card!!!

Facebook: www.facebook.com/midislandmortgagenanaimo
We thrive off of your continued support and client referrals. Let us reward you for helping us get our name out into the community! Please mention who referred you or how you heard from us, when filling out your mortgage application. The name you give us will also be entered into the same draw for coming in to see us!

We are open Monday to Friday from 9 am to 5 pm. Kevin Decker can also be reached after hours at 250 619 2262 and Jason Barudin can be reached at 250 668 2203.

Lenders hike fixed rates yet again, bringing them closer to 4.5%

-Steve Huebl of Canadian Mortgage Trends-

 

Following a jump in bond yields last week, lenders across the country once again bumped up their fixed mortgage rates.

 

Big banks like RBC, TD and BMO hiked 5-year fixed rates by 20 to 25 basis points, with all three offering uninsured rates at 4.39%.

 

The move follows a nearly 10-bps jump in the Government of Canada 5-year bond yield, which leads 5-year fixed rates. The 5-year bond yield closed at an 11-year high of 2.88% on Friday. Since the beginning of the year, bond yields are up over 165 bps.

 

 

Among national lenders, the average uninsured 5-year fixed rate is now 4.37%, up from 3.92% a month ago, according to data tracked by Rob McLister, rate analyst and editor of Mortgage Logic. The average rate for an insured 5-year fixed mortgage, meaning that with a down payment of less than 20%, is now 4.14%, up from 3.78% a month ago.

 

That means fixed rates are now up roughly 40 bps in just the span of one month. For perspective, a 50-bps rate increase translates into a roughly $25 higher monthly payment per $100,000 of debt, based on a 25-year amortization.

 

While this doesn’t impact most borrowers with fixed rates, new borrowers and those renewing a mortgage are facing significantly higher rates compared to just several months ago, and potentially double for those renewing a mortgage.

 

As fixed rates march higher, variable rates are likely to jump again following the Bank of Canada’s next rate decision meeting on June 1, when it’s expected to hike interest rates another 50 bps. That could bring prime rate—the rate upon which variable rate mortgages and lines of credit are priced—up to 3.70%.

 

How rising rates will impact mortgage borrowers…

Aside from higher monthly payments, how will mortgage borrowers be impacted by these rising rates?

 

“As interest rates march higher—we expect the overnight rate to hit 2% by October, a projection that increasingly looks conservative—borrowing costs for Canadians will also rise, leaving the average Canadian household to spend almost $2,000 more in debt payments in 2023,” say economists from RBC Economics.

 

“This will erode spending power, especially for the lowest earning fifth of households which spend 22% of their after-tax income on debt servicing (including mortgage principal and interest payments),” they add.

 

On the other hand, RBC notes that the pandemic helped boost savings among Canadian households.

 

“The pandemic may have boosted debt, but it also left Canadian households sitting on $300 billion in savings,” the RBC economists wrote. “That’s a huge backstop—enough to cover about a year and a half of total Canadian household debt payments.”

 

How will rising rates impact home prices?

While the latest housing data showed home sales plummeting in April, house prices have so far held steady throughout most of the country outside of Ontario. In the Greater Toronto Area, average prices are so far down roughly 6%, but by as much as 22% depending on the housing type and specific region. Benchmark prices are often a lagging indicator, so further price declines are likely in the months ahead.

 

“…tomorrow’s homebuyers are going to have a much harder time paying today’s prices if they’re paying 5% on their mortgage compared to the low 2% range just a few months ago, and the high 1% range a year ago,” wrote real estate analyst John Pasalis, president of Realosophy Realty, in a recent post on move smartly.

 

Pasalis noted some have argued that this isn’t a concern, since many borrowers have been qualifying at a stress test rate of at least 5.25%, but he suggests that’s an oversimplification of the situation.

 

The mortgage stress test is currently used to qualify borrowers at the greater of the buyer’s actual mortgage rate plus 2% or the benchmark rate, which is currently 5.25%.

 

“As these are dynamic measures that will change as rates do, the stress test will also increase, which will reduce the amount of debt a buyer can take on,” Pasalis writes, adding that the contract rate influences how much mortgage debt the borrower is willing to take on.

 

“A buyer who qualifies for a $1M mortgage may be willing to take on that much debt when interest rates are 1.75%, but less so when rates are 4%, because under the higher rate their actual mortgage payment would be roughly $1,100 per month higher,” he wrote.

 

As a result, if interest rates continue to trend higher, Pasalis says he “would not be surprised if we see some downward pressure on home prices over the next 9 to 18 months due to homebuyers being unwilling or unable to pay today’s prices at tomorrow’s higher interest rates.”

 

Although, he adds that any price decline would “likely be a temporary one due to long-term fundamental factors that have been contributing to rising home prices in the Toronto area.”

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Supporting Ukraine…

Mortgage Professionals Canada | 2022

 

Mortgage Professionals Canada and the Mortgage Professionals Canada Foundation have partnered to raise and distribute humanitarian relief funds to Ukraine.

 

The MPC and MPC Foundation Boards of Directors have carefully selected two established charitable organizations for their outstanding efforts to provide much needed medicine, supplies, and shelter to vulnerable individuals coping with hardship in Ukraine.

 

With the urgency facing the people of Ukraine, we ask that mortgage professionals donate generously to this joint initiative to provide humanitarian relief through: The Canadian Red Cross, and Doctors Without Borders/ Médecins Sans Frontières (MSF). Funds will be collected by the MPC Foundation and distributed evenly between these two very capable organizations, each of which will provide support directly to those most impacted.

 

Mortgage Professionals Canada has already donated $10,000 to support this initiative.

 

Please join us. Any amount helps. Click here to donate… https://mpcfoundation.ca/donate/ukraine/

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Have more mortgage questions or concerns? Call our office today at 250 753 2242 and we can help with all of your mortgage questions!

 

“LIKE” our Facebook page or “SHARE” this post to be entered into our quarterly draw for a $150.00 gift card!!!

 

Facebook: www.facebook.com/midislandmortgagenanaimo

We thrive off of your continued support and client referrals. Let us reward you for helping us get our name out into the community! Please mention who referred you or how you heard from us, when filling out your mortgage application. The name you give us will also be entered into the same draw for coming in to see us!

 

We are open Monday to Friday from 9 am to 5 pm. Kevin Decker can also be reached after hours at 250 619 2262 and Jason Barudin can be reached at 250 668 2203.

Many BC homeowners reportedly planning to leave province soon – CMP – REMAX

-Many BC homeowners reportedly planning to leave province soon-

Pandemic impacts and affordability concerns rank high among the reasons for moving out…

A significant share of British Columbian homeowners are planning to leave the province within the next five years, raising the possibility of even more supply entering the red-hot market during that period, according to RE/MAX.

Citing data from Insights West, RE/MAX said that 17% of the province’s homeowners are thinking of selling their home in the next two years, while 29% are considering doing so in the next five years.

Of those planning to sell their homes, 10% are considering downsizing, 11% want to relocate somewhere else in BC, and 9% are planning to move to another province altogether in search of more affordable housing.

“The relentless climb of real-estate prices in BC, and in Metro Vancouver in particular, has resulted in many homeowners weighing their options for cashing out,” said Steve Mossop, president of Insights West. “The option to downsize or move to a different location… in order to take advantage of the equity in their existing home has many weighing the alternatives.”

For 36% of BC’s homeowners, a major driver of the decision to move out was the financial impact of the pandemic. Affordability concerns ranked high on the list as well, with 72% of respondents saying that housing prices will likely continue rising over the next 12 months and lasting well into the next two to five years.

Anxiety surrounding “the likelihood of higher interest rates is also prevalent among BC residents,” RE/MAX said.

Low Rates Help Borrowers Pay Mortgage at Record Pace – Canadian Mortgage Trends

Home prices may be astronomical in certain parts of the country, but historically low mortgage rates are allowing borrowers to pay off their mortgages faster than ever.

At today’s average rates, 61% of a new homebuyer’s very first mortgage payment is going towards principal repayment, according to data from Edge Realty Analytics.

In the early 2000s, that percentage was 26.5%. The change is even more drastic when looking back at the 1990s, where just 11.9% of a homebuyer’s first payment went towards paying down the principal, or the 1980s, when that percentage was a minuscule 4.6%.

The result is a much faster build-up of equity over a short period of time, so long as interest rates remain low.

After the first five years of mortgage payments, today’s homebuyers borrowing at today’s prevailing rates will have paid back more than a fifth of their mortgage (16.5%). Here’s a look at how that compares to past decades:

 

Mortgage payments

(Courtesy: Edge Realty Analytics)

 

“Homeownership represents a very aggressive forced saving program,” Mortgage Professionals Canada noted in its annual consumer report.

As a result (and even before we consider the impact of price growth) housing equity is built very rapidly,” the report noted. “This excellent ‘net affordability’ goes a long way to explaining why homebuying activity has remained strong in Canada and why a large majority of Canadians see homeownership as financially better than rentingdespite the rapid runup in house prices and the higher burden of mortgage (principal plus interest) payments.”

(Source: Mortgage Professionals Canada)

 

Not only have low interest rates allowed borrowers to repay their mortgages more quickly, but it’s also kept housing moderately “affordable” despite the 38.4% run-up in average home price in the past 12 months.

“If it were not for the extremely low interest rate, most cities in Canada, especially Toronto, Ottawa, Vancouver and Montreal, would be in overvalued territory,” Alberta Central chief economist Charles St-Arnaud wrote in a recent analysis. “It means that the main driver for affordability is the record low level of interest rates.”

But Rates Won’t Stay Low Forever

All good things must come to an end, and that goes for ultra-low mortgage rates.

The Bank of Canada has made it abundantly clear that it expects to start raising interest rates by late next year.

How much rates will increase in the Bank’s next rate-hike cycle is anyone’s guess. But for what it’s worth, markets are pricing in at least eight 25-bps hikes over the next five years, which would bring Canada’s overnight rate to 2.25%, up two percentage points from its current record-low of 0.25%.

But even a more modest rise in rates of as little as 100-150 basis points could “push the valuation metrics into overvalued territory,” St-Arnaud noted, making today’s still somewhat “affordable” housing market patently unaffordable for most.

“Our simulations show that many cities in Canada will struggle with housing affordability as interest rates increase,” he added. “A 150-bps increase in mortgage rates could be enough to generate significant headwinds on some housing markets and house prices.”

Have more mortgage questions or concerns? Call our office today at 250 753 2242 and we can help with all of your mortgage questions!

 

“LIKE” our Facebook page or “SHARE” this post to be entered into our quarterly draw for a $150.00 gift card!!!

 

Facebook: www.facebook.com/midislandmortgagenanaimo

We thrive off of your continued support and client referrals. Let us reward you for helping us get our name out into the community! Please mention who referred you or how you heard from us, when filling out your mortgage application. The name you give us will also be entered into the same draw for coming in to see us!

 

We are open Monday to Friday from 9 am to 5 pm. Kevin Decker can also be reached after hours at 250 619 2262 and Jason Barudin can be reached at 250 668 2203.

CANADA’S HOUSING MARKET – 2021 FORECASTS – CANADIAN MORTGAGE TRENDS

CANADA’S HOUSING MARKET – 2021 FORECASTS – CANADIAN MORTGAGE TRENDS

The Canadian real estate market defied gravity last year in spite of a global pandemic and nationwide lockdowns.

The year ended with the seasonally adjusted MLS Home Price Index up 13% year-over-year and the average house price surpassing the $600,000 mark.

“It’s official, despite all the challenges, 2020 was a record year for Canadian resale housing activity,” Costa Poulopoulos, Chair of the Canadian Real Estate Association (CREA), declared.

But where do prices go from here?

Will prices finally fall, as many have been predicting since early last year? Will they moderate and return to more sustainable growth, or is it still full-steam ahead?

Nobody knows for sure, of course. But we’ve compiled a rundown of some of the many (and varied) 2021 house price forecasts to get an idea of what some of the smart minds in the industry think.

We’ve also included some previous 2020 forecasts, where possible, to illustrate the fallibility of forecasting.

In case we need a reminder of how “off” forecasts can sometimes be, one need not look further than CMHC’s prediction of a 9% to 18% decline from pre-COVID prices by the end of 2020. That was a forecast that, at least so far, hasn’t aged well.

CREA

·         2021 forecast: +9.1%

·         2020 forecast: +6.2%

·         Commentary: “(We are) anticipating healthy housing price growth in 2021, with move-up and move-over buyers continuing to drive activity in many regions across the Canadian housing market. An ongoing housing supply shortage is likely to continue, presenting challenges for homebuyers and putting upward pressure on prices.”

CMHC

·         2021 forecast: -9% to -18% (pre-COVID peak-to-trough decline)

·         The agency first released this forecast last spring at the height of the first wave of the pandemic. While the timeframe has been been pushed out, CMHC continues to stand by this forecast.

·         2020 forecast: an average MLS Price of between $506,200 and $531,000

·         Commentary: “When I say I stand by our forecasts, it’s really with respect to what are the broad trends we expect moving forward,” CMHC Chief Economist Bob told reporters in September. “When I look at the housing market there are a tremendous number of risks.”

Real Estate Firms

Royal LePage

·         2021 forecast: +5.5%

·         2020 forecast: +3.2%

·         Commentary: “Across the country, a large number of hopeful buyers intent on improving their housing situation were not able to find the home they were looking for this year, as the inventory of properties for sale came nowhere near to meeting surging demand. With policy-makers all but promising record-low, industry-supportive interest rates to continue, we do not see this imbalance improving (this) year. The upward pressure on home prices will continue.”

RE/MAX

·         2021 forecast: +4% to 6%

·         2020 forecast: +3.7%

·         Commentary: “(We are) anticipating healthy housing price growth in 2021, with move-up and move-over buyers continuing to drive activity in many regions across the Canadian housing market. An ongoing housing supply shortage is likely to continue, presenting challenges for homebuyers and putting upward pressure on prices.”

The Banks

RBC

·         2021 forecast: +8.4%

·         Commentary: “We see little that will stop activity or prices from reaching new heights in the year ahead…Yet we also expect cooling signs to emerge, which will come into fuller display in 2022. The main restraining factors will be a lack of supply, waning pandemic-induced market churn, a modest creep-up in interest rates and an erosion of affordability. Call it a 2022 soft landing.”

TD

·         2021 forecast: +5.8%

·         TD is calling for an initial plunge in home prices of 7% in early 2021, before recovering in the latter part of the year to post an overall year-over-year price gain.

·         Commentary: “Canadian prices will likely drop through the first half of 2021 by around 7%, before regaining some traction later (in the) year. While this sounds like a big hit, it would still leave the upward trend in prices, established prior to the pandemic, in place. Some added pressure on prices could emerge on the supply side. Case in point, the end of mortgage deferral programs is likely to spark some additional supply on the market.”

CIBC

·         2021 forecast: +2.4%

·         This is based on an average of the bank’s upside case of an 11.2% price gain vs. its downside case of a 6.9% decline over the next 12 months.

National Bank of Canada

·         2021 forecast: -5.2%

·         This is based on an average of the bank’s upside case of a 1.5% price decline in 2021 vs. its downside case of a 9.9% decline.

·         Commentary: “We were pleasantly surprised by the performance and house prices so far during the pandemic. Although in our forecasts, particularly in the pessimistic case, we don’t assume strength in the housing market. I think for the macroeconomic scenarios, and that which goes into generating our allowances, you can consider those scenarios quite prudent.”

BMO

·         2021 forecast: +6.6%

·         This is based on an average of the bank’s quarterly MLS Home Price Index forecasts, ranging from +11.6% in Q1 to +0.5% by Q4.

·         Commentary: “We expect the market to lose some momentum in the months ahead, as tighter mobility restrictions, the small back-up in long-term yields, the ongoing absence of immigration, and still-soft employment conditions will weigh. To be clear, we don’t look for a reversal in the broader (housing) market, just some moderation from (December’s) extraordinary results. After all, ‘stay at home’ doesn’t translate to ‘don’t buy a home.’

Scotiabank

·         2021 forecast: +0.4%

·         Commentary: “The delay of some activity into H2-2021, when we had already expected widespread inoculation to lift economic growth, likely means stronger second-half activity than we previously anticipated. Rock-bottom interest rates, ongoing federal and provincial fiscal supports, and the current supply-demand tightness should also contribute to home price gains over the medium-term.”

Credit Rating Agencies

Moody’s Analytics

·         2021 forecast: -7% (peak-to-trough decline)

·         Commentary: “The housing market will no longer be able to escape the poor condition of the labour market as vacancy and delinquency rates rise in 2021…Fortunately, the declines will be brief and the restoration of robust job growth in 2022 along with Canada’s strong demographics will put a floor under the housing market.”

Fitch Ratings

·         2021 forecast: -5%

·         Commentary: “We attribute the expected decline to lower demand caused by elevated levels of unemployment and increasing affordability issues…Although we expect delinquencies to increase in 2021, we do not expect the level of delinquencies, distressed sales or foreclosures to increase to the levels seen in the U.S. during the financial crisis.”

 

Have more mortgage questions or concerns? Call our office today at 250 753 2242 and we can help with all of your mortgage questions!

 

“LIKE” our Facebook page or “SHARE” this post to be entered into our quarterly draw for a $150.00 gift card!!!

 

Facebook: www.facebook.com/midislandmortgagenanaimo

We thrive off of your continued support and client referrals. Let us reward you for helping us get our name out into the community! Please mention who referred you or how you heard from us, when filling out your mortgage application. The name you give us will also be entered into the same draw for coming in to see us!

 

We are open Monday to Friday from 9 am to 5 pm. Kevin Decker can also be reached after hours at 250 619 2262 and Jason Barudin can be reached at 250 668 2203.

Ten Home Design Trends Here To Stay For 2021 – Forbes

When it comes to interior design, 2021 isn’t too different from 2020.

Unlike Chip and Joanna Gaines, the pandemic has been the biggest influence on interior design that no one asked for. At the beginning 2020, designers were touting two-tone kitchens and bold colors as the next big trends. Little did anyone know that practical amenities like home offices, gyms and bidets would end up being the most important design trends of 2020.

Still, while the new year presents a new opportunity to refresh our homes, in certain ways it still feels as if we’re stuck in 2020. Many locations are still under stay-at-home orders, remote work has become the norm, and some children aren’t yet back in school full-time. And while we’ll see some new looks for the home this year, many of the trends influenced by the pandemic are here to stay for 2021.

Home Gyms         

         

If something positive can be taken away from the pandemic, it’s that we all need to be mindful of our heath and lifestyle choices. Gyms have not reopened everywhere and many people have adapted to home fitness routines. So, having a space to exercise couldn’t be more important, especially to Asha Kai, CEO of activewear brands Cor and Ultracor. “These days, being active is not an option— it’s essential for mental health,” she says.

Before the pandemic, Kai built a gym on the first floor of her Los Angeles home. She had more than enough equipment to stay fit when she couldn’t make her regular Pilates class.

When COVID shut everything down, it became her only option. “In the midst of running two national brands and raising three kids, working out must stay a priority if I want to perform at my best. Since the pandemic has restricted access to gyms and studios, I feel incredibly fortunate to have a home gym to keep me in shape.”

However, if you don’t have a large amount of space or a separate room, that doesn’t mean home workouts are out of the question. Personal trainer and podcast host, Doug Bopst believes extra square footage or investing in expensive equipment isn’t necessary. “You can just corner off a section of your basement, family room, or office with dumbbells, resistance bands, and a ball. Then expand off of that,” he says.

Purchasing portable cardio equipment is another option. “I advise people to buy a brand new rowing machine. Aim to spend somewhere around $900. You can lean it up against the wall when it isn’t being used to save space,” he says.

To make a home gym area blend in with your decor scheme, store dumbbells, resistance bands, and other equipment in a cube-style bookcase with bins. This unit from Wayfair is available in several shades of wood so you can coordinate it with your furniture.

Home Offices

Because technology has made the large, corporate office unnecessary in many ways, home offices are now considered a “must-have.”

“For those fortunate enough to work from home this past year, a home office or work-from-home zone has become essential. Even as business and offices reopen, many companies have made a conscious shift to a work-from-home hybrid model that only requires employees to come into the office a few days a week,” says Justina Blakeney, founder of Jungalow. “We’ll see a rise in home offices and creative solutions to create work zones. For example, if renovations are out of reach, people may take off sliding closet doors and turn a guest bedroom closet into an office.”

While most people are forced to adapt the space they currently have, it’s likely many new homes will be built with home office spaces. In homes undergoing renovations, we’ll likely see built-in desks, sectioned off alcoves, and other areas converted into workstations.

Elevated Outdoor Spaces

 “In 2020, people were spending more time in their yards for health and safety reasons. Many were sitting on their patios for the first time, socializing at a distance in their backyards, or watching birthday parades from their front yards, says Blakeney.

She predicts indoor spaces will continue to inspire outdoor design with outdoor rugs and dining sets becoming popular choices for most backyards. The same can be said for fire pits and other outdoor heat sources which have become essential in cooler climates.

Nature-Inspired Designs

The natural world has been a major influence on design in recent years. “More than ever, we’re craving a renewed bond with nature and the outdoors. Organic materials and pure textiles showcase nature’s beauty, structure, and irregularities,” Rebecca Breslin, Senior Design Manager at Wayfair Professional tells me. “Earth tones, organic shapes and textures, woven rattan, and reclaimed materials speak to our need for sustainable design and everyday wellness.”

The prominence of plants is another example of nature-inspired design. “In the past couple of years, it’s been houseplants everywhere,” says Danielle Blundell, Home Director of Apartment Therapy. “Everybody is bringing in trees, they have windowsill gardens— maybe they have an herb garden, but it’s just plants on plants on plants. And I don’t think that’s going anywhere.”

However, Blundell sees this aesthetic evolving in 2021 through the incorporation of biophilic motifs, “It’s an emphasis on flora and fauna. In the past, we’ve seen cutesy florals and very springy palates. This time around, it’s a little bit earthier, a little bit moody.”

Gallery Walls

The gallery wall is on its way to becoming a classic and isn’t likely to fall out of favor any time soon. However, according to HomeGoods Style Expert and Interior Designer, Beth Diana Smith, there is an overall shift towards making this design choice more meaningful and intentional than in previous years. “[In 2020], we saw a greater focus on cultural design tied to embracing one’s ethnicity, background, and traditions, which I hope will continue far past 2021.”

Smith recommends framing old family photos and keepsakes using a mix of metal and wooden frames, in a variety of sizes and styles, which are easy to find at stores like HomeGoods. “The gallery wall will tell the story of your family and heritage, and the varying frame styles will help to showcase different stages of your family and life.”

Uplifting Art

Brightly colored and whimsical art was a trend that picked up in 2020 to contrast the stark reality of life. Although 2021 feels like a better year already, an overall gravitation towards bright colors is likely here to stay, according to Alix Greenberg, founder of ArtSugar. “Sales for our acrylic mountable smiley faces, and colorful pieces that pop soared, illustrating that when people are stuck at home, at very least, they want to feel joy. As the new year begins and as we come closer and closer to the end of this pandemic, the feel-good art trend isn’t going away.”

Walnut Wood

Walnut wood, which many people associate with mid-century modern design has fallen in and out of style for the past decade, but it’s back and likely here to stay. “When we launched in 2011, walnut was our calling card— its rich, deep browns and dramatic grain patterns gave every customer a unique, one-of-a-kind look,” says Molly McDermott Walsh, Vice President of Marketing at Semihandmade. “Walnut’s popularity has ebbed and flowed over the past ten years, but it definitely seems to be enjoying a moment again now, as reflected in our 2020 sales.”

Art Deco

New York City and Paris based interior designer Alexander Doherty is a proponent of art deco style, which had a revival in 2020. This style will continue to remain popular because of how well it integrates into contemporary spaces. “It is ideal for new construction, like many homes in New York City that live in glass tower buildings. Art deco is a style that will incorporate itself very easily into homes with little architecture. It is key to be able to give a nod to the past while utilizing modern elements.”

For those looking to integrate more of this style into their current abodes, he suggests combining a variety of materials, styles, and time periods to create a unique layered look.

Bidets

With toilet paper shortages across the country in 2020, many Americans had no choice but to look into an alternative that some previously considered too European for their personal tastes. The bidet is currently having a moment.

From the hard installation of fixtures to less design forward toilet seat attachments, the bidet will continue to trend this year. “I think the toilet paper gate of 2020 scared us all and we have been getting a couple of inquiries about our thoughts on bidets,” Tiffany Leigh of Tiffany Leigh Design tells me.

Finishing Touches

COVID dragged out and delayed many renovations. But in 2021, these projects are finally coming to fruition. After a long wait, artist and designer Elizabeth Sutton reveals there is an overall trend of doing whatever it takes to achieve the perfect aesthetic. “People had been in the process of completing their spaces and forgetting finishing touches like decorative objects and art, once their furniture arrives. But this year, as well as the end of last year, I’ve seen a lot of art purchases, adding new rugs and painting walls to add vibrancy into homes.”

After all, if we’re spending so much time in one place, there’s no reason why it shouldn’t be perfect.

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We are open Monday to Friday from 9 am to 5 pm. Kevin Decker can also be reached after hours at 250 619 2262 and Jason Barudin can be reached at 250 668 2203.