Karen Guy - West Kelowna Realtor ~ New Mortgage Rules

OTTAWA — Finance Minister Jim Flaherty unveiled changes Monday morning to mortgage lending rules that would see Ottawa stop backing home loans greater than 30 years and make it more difficult for households to use their property to access financing.

The changes, as reported by the National Post on Sunday, emerged as worries escalate among Bay Street leaders and the Bank of Canada about the record levels of household indebtedness, and how conditions could deteriorate unless pre-emptive action was taken.

The key change announced is that mortgages with amortization periods longer than 30 years will no longer qualify for government-backed mortgage insurance, which is required for buyers with less than a 20% down payment on a home. The previous limit was 35 years.

Also, Mr. Flaherty lowered the maximum amount Canadians can borrow against the value of their homes, to 85% from 90%, on a refinancing; and removed federal government backing for home equity lines of credit, or so-called HELOCs, whose popularity soared in the past decade with growth double that of mortgage debt.

"Canada's well-regulated housing sector has been an important strength that allowed us to avoid the mistakes of other countries," Mr. Flaherty said at a media conference. "The prudent measures announced [Monday] build on that advantage by encouraging hard-working Canadian families to save by investing in their homes and future."

Executives at Bank of Montreal applauded the government's move.

“The actions announced are prudent, measured, responsible and timely,” said Frank Techar, president of personal and commercial banking at Bank of Montreal.

The changes will be implemented in stages, with adjustments on amortization and refinancing limits coming into force on March 18. Government backing on HELOCs will be removed as of April 18.

The government said exceptions would be allowed after the new measures come into force when needed to satisfy a home purchase or sale and financing agreement struck before the March and April in-force dates.

The minimum down payment, at 5%, will remain as is. Further, there are no plans to target condominium purchases by requiring monthly condo fees be added to the list of expenses that is measured against income to decide whether a buyer can afford a mortgage.

Analysts at Scotia Capital said in a morning note the changes had been anticipated for some time. “We remain of our long-held belief that Canada is tapped out on housing and household finance variables that are all at cycle tops, in contrast to the U.S. that has already moved well off cycle tops and may be creating some pent-up demand,” said economists Derek Holt and Gorica Djeric.

The changes to the country’s mortgage rules -- the second in as many years -- emerge amid rising concern about the record levels of household debt, which measured as a ratio of money owed to disposable income nears a startling 150% as of the third quarter of last year. That surpasses the level of debt held by American households, whose appetite for borrowing helped stoke the financial crisis of a few years ago.

The Bank of Canada recently warned debt levels are growing faster than income, and the risk posed by consumer indebtedness to the domestic economy would continue to escalate without a “significant change” in how consumers borrow and banks lend.

Bank of Canada governor Mark Carney said policymakers have a “responsibility” to look at the benefits of pre-emptive action. Joining the chorus have been chief executives at the big banks, most notably Ed Clark at Toronto-Dominion Bank, in publicly advocating for tougher mortgage standards.

Last Friday, Prime Minister Stephen Harper acknowledged his government was considering changes to the rules governing mortgages.

In February of 2010, Mr. Flaherty moved to toughen up the mortgage rules amid worries that Canada was in the midst of a housing market bubble. The reforms, since introduced, compelled borrowers to meet standards for a five-year fixed-rate mortgage, even if the buyer wanted a shorter-term, variable rate loan; reduced the amount Canadian can borrow against their home, to 90% of the property value from 95%; and require purchasers of rental properties to issue a 20% down payment as opposed to 5%. The moves played a role, observers say, in slowing down real estate activity.

The Scotia Capital analysts suggested government regulation was the way to go in terms of curbing household appetite for credit as opposed to the Bank of Canada raising interest rates, which they said would be “imprudent” at this time.

The central bank issues its latest rate statement on Tuesday and it is expected to hold its benchmark rate at its present 1% level as signs indicate the economy may be benefiting from renewed business and consumer confidence in the United States.

Stewart Hall, economist at HSBC Securities Canada, said the extraordinarily low-rate environment “provides all the incentive to consumers to borrow and spend and none of the incentive to save. You can try to [regulate] that away but that is apt to be fraught with significant frustration.”


Karen Guy, REALTOR®

I am the GUY that will make a difference!

Coldwell Banker Horizon Realty
C 250.878.3605 O 250.768.8001

http://www.connectwithkaren.com/

West Kelowna Realtor Karen Guy ~ BCREA Latest Stats

Record Home Prices for 2010
Vancouver, BC – January 13, 2011. The British Columbia Real Estate Association (BCREA) reports that Multiple Listing Service® (MLS®) residential sales in the province declined 12 per cent to 74,640 units in 2010. The annual average MLS® residential price rose 8.5 per cent to a record $505,178 in 2010.

"Tighter credit conditions and expended pent-up demand curbed home sales during the first half of 2010,” said Cameron Muir, BCREA Chief Economist. “However, low mortgage interest rates and improved economic conditions buoyed home sales in the latter half of the year.” MLS® residential unit sales declined 40 per cent January through July before climbing 43 per cent by the end of the year, on a seasonally adjusted basis.
"The inventory of homes for sale peaked at 53,375 units in May before declining 14 per cent to 46,000 units by December,” added Muir. “The combination of fewer active listings and increased consumer demand has improved market conditions in many areas."
MLS® residential sales declined 25 per cent to 4,258 units in December from a near record level of 5,703 units in December 2009. After a 15 per cent increase in unit sales between October and November, a further 1 per cent increase was recorded in December on a seasonally adjusted basis. The average MLS® residential sales price was a record $523,990 in December, up 6 per cent from December 2009.

Karen Guy, REALTOR®

I am the GUY that will make a difference!
Coldwell Banker Horizon Realty
C 250.878.3605 O 250.768.8001
http://www.connectwithkaren.com/

West Kelowna Real Estate ~ Karen Guy ~ Wow, this is why I love my job!

Merry Christmas Karen! Thank-you so much for the card, calender and chocolates!

I love the calender! I find I really use that style so useful for keeping track of all my daycare stuff. I love my new place and neighbourhood. I'm SO glad I made the move. Everything you did for me helped make things go smoothly so THANK-YOU from the bottom of my heart! Love, Bonna
 
Karen Guy, REALTOR®
I am the GUY that will make a difference!
Coldwell Banker Horizon Realty
C 250.878.3605 O 250.768.8001

http://www.connectwithkaren.com/

West Kelowna ~ Homeowners Protect Yourself Now ~ CO Detectors

Homeowners can take action against potential carbon monoxide poisoning by taking the following steps:

This is an IMPORTANT REMINDER to take this time to ensure you CO detectors are working.


Carbon monoxide (CO) is an odorless, colorless gas produced by the combustion of fuels such as natural gas, oil, and propane in devices such as furnaces, water heaters, and stoves. These items are normally designed to vent the CO to the outside, but harmful interior levels of CO can result from incomplete combustion of fuel, improper installation, or blockages, leaks or cracks in the venting systems.

• Have all fuel-burning appliances professionally inspected yearly, preferably before the start of the cold-weather season when heaters and furnaces are first used

• These appliances include gas stoves and ovens, furnaces and heaters, water heaters, generators, and clothes dryers

• All such devices should be properly installed and vented to the outside whenever possible

• If repairs are necessary, be sure they are performed by a qualified technician

• Always use the proper fuel specified for the device

• Have flues and chimneys for fuel-burning fireplaces or wood stoves inspected regularly for cracks, leaks, and blockages that may allow a buildup of CO to occur

• Never use gas stoves or ovens to heat the home, even temporarily

• Do not start or idle a vehicle in a garage, even with the outer garage door open.

• For additional protection, purchase a CO detector (either battery operated or plug-in) and follow the manufacturer's instructions for proper location and installation

• Learn what to do should the CO alarm activate: If anyone in the home experiences symptoms such as fatigue, dizziness, blurred vision, nausea, or confusion, everyone should leave immediately and seek medical attention. If no symptoms are felt, open doors and windows immediately and shut off all fuel-burning devices that may be potential sources of CO.



Karen Guy, REALTOR® I am the GUY that will make a difference!

Coldwell Banker Horizon Realty C 250.878.3605 O 250.768.8001
http://www.connectwithkaren.com/

Karen Guy, REALTOR® ~ Holiday Viewings are Worth a Look

Holiday Viewings

The holiday season is fast approaching. It’s a time that is traditionally taken up with family gatherings, parties and general celebration, with all the flurry of activities that go with it. Real estate is often the furthest thing from the most people’s minds – but I’d like to tell you that if you’re one of the home buyers and sellers who think that way, you could be missing out!

The holiday season can have definite advantages for both buyers and sellers. If you currently have your home listed for sale, you may find yourself caught up in the time demands of shopping and entertaining. You may be feeling that you don’t need the added stress of keeping your home in “show-ready” condition at a time of year when viewings may tend to slow down. In fact, some home sellers won’t accept viewing appointments during the holiday season. While that’s your choice, you should be aware that a decision like that could result in a missed opportunity. After all, in today’s ethnically diverse society, there are still many prospective buyers who may not be celebrating the holiday season, yet they still have time off to view properties. Also, with some homes not accepting viewing appointments, your listing may have less competition during the holiday period.

Of course, if your home is decorated for the holidays, it probably looks at its most attractive. Holiday viewings have the advantage of showing off your home at its most welcoming, and prospective buyers can envision themselves in its warm and inviting atmosphere. So why not roll out the welcome mat to potential buyers too?

The holiday season offers advantages for buyers as well. Fewer buyers actively looking during the holidays means there’s less competition from other buyers. It’s still an excellent time to go house hunting. As your local Coldwell Banker real estate professional, I can help bring you a home for the holidays!


Karen Guy, REALTOR®

I am the GUY that will make a difference!

Coldwell Banker Horizon Realty C 250.878.3605 O 250.768.8001
http://www.connectwithkaren.com/

Karen Guy, REALTOR® ~ Maintaining Your Hot Water Tank

MAINTAINING YOUR HOT WATER TANK

Performing routine checks and maintenance on your hot water tank, whether it is gas, oil or electric, is vital to extending the life and efficiency of the tank and ensuring your safety. The normal life expectancy of a tank is 8 – 12 years. Older tanks have the manufacture date as part of the serial number; however newer tanks have stickers with the date of manufacture clearly stated.

Completely check the tank for any signs of leaks, corrosion, damage and deterioration. Check water lines on top of the unit for leaks and corrosion; also check that the bottom drain valve is not leaking. You should routinely drain the tank and flush out any silt and debris on the bottom of the tank. This will greatly increase the life and efficiency of your tank, especially if you are on a well system.

The area around the tank should be kept clear of debris and combustibles. Air flow is required to help with combustion and the performance of your tank. Visually check the tank’s main components. Check the burner and pilot-light burn pattern and look for signs of corrosion and deterioration and ensure that the flame shields are in place. Air flow to the burner area should not be obstructed.

Next, take a look at the temperature pressure relief valve (TPRV) located on the side of the tank. The TPRV is designed to release any build-up of pressure or temperature. There should be no signs of leakage or corrosion. The TPRV should also be equipped with a down-tube to safely direct any release of hot water and/or steam from hitting you. The TPRV should never be capped. Without the ability to release pressure, your tank will essentially become a ticking bomb.

The vent connector/exhaust pipe on top of the tank should be securely attached with no holes or corrosion. If the vent is not in good condition it could lead to the off gassing of Carbon Monoxide, which can make you ill or at high levels, lead to fatality.

You should consult a professional plumber if any of the above issues exist or if you have any questions or concerns.


Karen Guy, REALTOR® I am the GUY that will make a difference! Coldwell Banker Horizon Realty C 250.878.3605 O 250.768.8001 http://www.connectwithkaren.com/

West Kelowna Realtor Karen Guy ~ Tips on Planning a Home Office

Planning Your Home Office


Technology is quickly changing our everyday lives, and if you’re like me, you want to use it to your best advantage, no matter what the time of day. For some people, that may also mean making a few changes to your home environment. More and more homeowners I talk to are converting their sewing room, games room or den into a home office.

If you’re thinking of creating a home office, a good place to start is making a list of needs that you want your home office environment to fulfill. Make sure that you consider possible future uses as well as just your immediate needs. Prepare a budget and include both the cost of equipment and any installation costs. Don’t forget to consider an extra phone line, and high-speed internet installation or wireless service costs. You should also determine whether any additional power outlets or lighting will be needed to accommodate your room’s new purpose. If you need electrical work done, factor this into your budget.

Your equipment cost is one area where you probably won’t want to skimp. With today’s rapidly-advancing technology, you may find that if you only go with a minimal set-up, your equipment could quickly become inadequate to handle your future needs. If you need to cut back on your budget, you will probably be better served by ‘getting creative’ with furniture or decorating costs. I’ll be giving you some tips about this in my next newsletter.

If you’re considering a home office, remember that when the time comes to sell, prospective buyers generally find a home office a welcome and attractive feature. And if you’re looking for more ideas to make your home more saleable, or you’re wondering what’s in demand for today’s homes, just give me a call. As your local Coldwell Banker sales professional, I can advise you about what’s hot and what’s not in our market, and how various improvements may affect the resale value of your home. Let’s talk.


Karen Guy, REALTOR® I am the GUY that will make a difference! Coldwell Banker Horizon Realty C 250.878.3605 O 250.768.8001 http://www.connectwithkaren.com/