 | |
| November 15th, 2016 • National Post | |
First-time homebuyers' break on the land transfer tax will double under a new proposal by the Ontario government, but wealthy purchasers will pay the price once new land transfer rules come into effect Jan. 1, 2017.
Absent from changes announced Monday to land transfer fees in the country's most populous province is any mention of an increase in the amount charged to foreign buyers, who now face an additional 15-percent tax in Vancouver. "The minister has avoided scapegoat-based politics. If you look to what his counterpart in British Columbia did it was essentially to look for groups to blame - in a nutshell, Realtors and the Chinese. Here they have focused on affordability and access (to the market)," said Phil Soper, chief executive of Royal Le-Page Real Estate Services, one of the largest firms in the country, referring to the changes announced by Ontario Finance Minister Charles Sousa. Under the change, Ontario will double the maximum land transfer tax refund for eligible first-time homebuyers to $4,000. It means no eligible homebuyers in Ontario would pay land transfer tax on the first $368,000 of the cost of their first home. Currently, Ontario residential property buyers - the city of Toronto has its own land transfer tax - pay 0.5-per-cent tax on the first $55,000 of their purchase, one per cent on amounts from $55,000 to $250,000, 1.5 per cent on anything from $250,000 to $400,000 and two per cent on anything over $400,000. The proposed changes would increase the tax on the portion over $2 million to 2.5 per cent. "You look at even in an expensive city like(Toronto), $2 million is well above the average detached home and the additional half a point only applies to amounts above $2 million. You add another million (to a purchase over $2 million) and it only amounts to $5,000," Soper said. "This is a very different approach to what happened in British Columbia. It's not aimed at one group." Soper said policy-makers do not want to risk taking the steam out of the housing market, something that seems to be happening in British Columbia, where sales continue to fall and were down almost 40 per cent on October, year over year. For now it does look like foreign buyers have escaped the wrath of the Ontario provincial government, said Doug Porter, chief economist of Bank of Montreal. "I would think we won't see anything soon," said Porter about an Ontario foreign-buyer tax. "I wouldn't say the issue is completely dead and buried. Obviously they don't think it is the thing to do at the moment. They need more of a groundswell. That's what it took in B.C. For a long time the B.C. government was not interesting in doing anything that would bring down prices or threaten people who own homes." Benjamin Tal, deputy chief economist with CIBC, said he doesn't think the tax changes will change much in the market. "Clearly they don't want to touch (foreign buyers). Let's see what happens in the next six months, if we see significant increase in purchases. They might revisit," Tal said. "They don't touch it now." |
Tuesday 15 November 2016
Ontario First Time Buyers Get a Break
Friday 11 November 2016
What is the Value in Hiring a Real Estate Agent?
| November 10th, 2016 • Lloydminster Source |
(NC) With the wealth of online resources dedicated to helping you search for a new home or sell the one you own, you might be wondering if you even need a real estate agent in the first place.
However, you may want to consider why many homeowners choose to enlist the services of a real estate professional. "A trusted real estate agent who comes recommended by others can increase your satisfaction with the process of buying a home in a number of important ways," advises Craig Blanchard, a broker-owner with Royal LePage Atlantic Homestead in St. John's, N.L.. Blanchard offers these considerations in determining the value your agent can provide: There's the Internet, then there's the "pipeline." While a quick search on the web is a great place to start, you'll want the inside track. A real estate professional will enhance your property search with a pipeline of properties. They, or others at their brokerage office, will also be aware of buyers who are looking within your area. Opt for the guided tour. When you tour a landmark or attraction your experience is enriched by someone who is familiar with the location who can guide you. As a community expert, your real estate "guide" can provide insights on historical market values, culture, and attractions, as well as local resources relevant to your interests and needs. A single point of contact. A real estate professional will help you determine how much house you can afford, alert you to potential risks, help you find resources, and negotiate the offer. Often a seemingly simple transaction can grow legally complex and risky. Again, this is where the pipeline comes in, as your agent can help you locate trusted legal counsel, home inspection services, surveyors, and lenders. Negotiating: A real estate professional can help you objectively consider the offer you plan to put forth. They can recognize the various strategies of a selling agent, which may serve to drive up the price. They can also provide insights that can help you submit a competitive offer on a home you don't want to lose. |
Thursday 3 November 2016
Borrowers need to watch the rate on Variable Rate Mortgages
 | |
| November 3rd, 2016 • Toronto Star | |
Consumers need to be increasingly vigilant about their loan choices in the wake of the TD Bank's decision to raise its prime rate on variable-rate mortgages, an Ontario mortgage broker said.
But new federal rules introduced last month, which require lenders to more rigorously stress-test fixed-rate mortgages, will open some financial choices for consumers, said Nicholas L'Ecuyer, CEO and founder of Mortgage Wellness in Barrie, Ont. For 15 months, the major Canadian banks offered the same prime rate. Now TD has essentially made that rate a moving target that borrowers will have to watch, he cautioned. Many variable-rate consumers choose a mortgage product based on the prime rate offered, plus or minus a certain per cent. For a long time, consumers would just look at that "plus or minus" number to determine whether a variable mortgage product was attractive. "Now, with one institution offering one prime and another institution offering another prime, you no longer just have to pay attention to the variance on prime, but the prime rate as well," he said. "It means consumers need to be more conscious of what the true price is," said L'Ecuyer. Other financial institutions are, however, expected to follow TD, which announced on Tuesday it was raising its variable mortgage prime rate to 2.85 per cent from 2.7 per cent - the first increase since July 2015. The increase isn't expected to change homeowners' payments, but it will mean a greater portion of those payments goes toward interest. L'Ecuyer doesn't expect the new rate to push consumers out of the housing market beyond those who are challenged to qualify under Ottawa's recently announced new mortgage rules. Quite the opposite, he said. "It opens up choice for clients." Before the new rules, a fixed-rate mortgage consumer had to qualify at the lender's rate. Since Oct. 17, however, all insured mortgage consumers - variable and fixed borrowers - have to qualify at the five-year Bank of Canadafixed rate of 4.64 per cent. "Now, if you qualify at that benchmark rate, you have a choice. You (can) take one-year, two-year, three-year or five-year variable rate - you have to qualify anyway," he said. Some of the new rules announced by federal Finance Minister Bill Morneau in early October take effect on Nov. 30. That's when mortgage lenders will be required to take on more risk for loan losses on insured mortgages that default. Most approve of new mortgage rules While they may be pushing some buyers out of the housing market, Ottawa's tougher rules for people who want to qualify for some mortgages are a good idea, according to 63 per cent of Canadians. A Forum Research poll of 1,437 Canadians found that only 18 per cent of respondents disapproved of the new tighter lending regulations and the elimination of a tax exemption for offshore real-estate buyers. The highest approval levels - 68 per cent - were among respondents 35 to 44 years old. Sixty-eight per cent of men approved, compared to 59 per cent of women. Higher-income earners also had higher approval levels. British Columbia had the highest approval level among the provinces, with 75 per cent liking the new measures. The new rules were least popular in Atlantic Canada, at 56 per cent. The interactive telephone poll was conducted on Oct. 11 and 12, about a week after federal Finance Minister Bill Morneau announced the new mortgage rules. The results are considered accurate within 3 per cent, 19 times out of 20. -Tess Kalinowski |
Subscribe to:
Posts (Atom)