Also RBC just lowered their rates too.

so did td and bmo as well.. quietly...

however, this post in OT made me a wee bit depressed.

http://forums.clubsi.com/ubbthreads.php/ubb/showflat/Number/7511496/fpart/1

I wish I could be as quick to pay it off in 8 years.

Also RBC just lowered their rates too.

I hope this isn't a young couple. If a crash happens, all price increases will be wiped out going back a few years. I bought in 1990 at the beginning of the crash and paid a peak price. Interest rates went sky high, and I sold fourteen years later for $14000 more than I bought it for. The youngsters have never seen a crashing market and seem blind to the possibility. Remember, what goes up, eventually comes down, even just a little bit.

Wish I could get a decent place for under 200k

Windsor or Barrie!

An industry site, MortgageBroker News, broke the story this week that the bank has changed the fine print in its contracts for conventional (no CMHC insurance) variable-rate mortgages – the kind where your interest charge rises each time the central bank causes primes to move. But it’s not rising rates the bank is worried about, rather falling real estate values.

Here’s the change: If, at any time or for any reason, the value of your house drops to a level which results in your mortgage exceeding 80% of it, the bank can demand you write a cheque to cover the difference. If you don’t, your mortgage goes into default. You also have the right to have your property appraised (at your cost) to prove it’s worth at least 80% of the loaned amount, whenever the bank demands such proof.

The old limit was 75%, and the former wording also limited the nightmare scenario to situations in which rising interest rates triggered the action. This time anything – like unemployment triggering a highly local market decline – means you have a problem.

Says one mortgage broker: “Property value decreases would have a huge impact on all TD variable rate mortgages.”

Says realtor Dan: “I think it’s preparation in the event of a price melt down and they want a 20 % cushion instead 25% to minimize the bank’s exposure to non CMHC mortgages.” Exactly. The bank is preparing its non-insured portfolio against what might be inevitable, if the Bank of Canada is correct. It’s only prudent, if you’re the lender. It’s a potential hell on wheels, if you’re the borrower.

For example, let’s say you bought a $400,000 condo in 2012 with the help of a $75,000 loan from your suffocatingly helpful helicopter parents, then took a $320,000 VRM from the boys at TD. The economy continues to wobble, interest rates don’t change, you’re not selling or moving, but units similar to yours start changing hands for $300,000.

If you’re a bank client, expect a letter like this:

It has come to our attention that the outstanding Principal Amount (including Deferred Interest) of your mortgage now exceeds 80% of the fair market value of the Mortgaged Property as determined by us (with or without an appraisal/valuation), (such amount being the Trigger Point), therefore we give you notice of this excess (the Trigger Point Excess) and within 30 days of the date of this letter you must do one of the following:
(i) make a lump sum payment to us at least equal to the amount of the Trigger Point Excess; or
(ii) satisfy us that the outstanding Principal Amount (including any Deferred Interest) does not exceed 80% of the fair market value of the Mortgaged Property as established by a qualified real estate appraiser, approved in writing by us, but at your expense.

There are many people who thought this day would never come. Now you know.

a decent place in barrie for under 200k?not gonna happen

fundamental shift in demand for our resources

I wouldnt call the job loss so far insignificant, especially for those local markets where that factory IS the town. We are losing more jobs than we are creating.( Blackberry is selling most of its real estate holdings.Hardly a nail in the coffin and they have obviously been hurting but shit like that is pretty significant).

Faraz is gonna have a tougher time selling shit. I dont think we need to lose an entire industry to see changes. Its more sensitive than that imo.

Anyways, it dont matter shit what we think. Shit is gonna happen how it happens.
A correction of 30%(for example) to you wouldnt mean much long term.
To the morAns who paid 850k for that shitbox the other day... or some of my friends who just bought and are beyond extended. To them it will definitely hurt.

I just cant logically see prices increasing at the rate they have. that makes zero sense at all. On any level, in any scenario. You need a place to live..fine But to rely on it as some retirement investment vehicle is hugely flawed and you will get burned.


people gonna do whatever the fuck they gunno do doe. The outlook is iffy at best.