October 2010 - SuperBrokers

Canadian Real Estate Association’s Anti-Competitive Rules Crushed

CERA’s 101 board representatives voted in overwhelming favour on an agreement that aims to eliminate anti-competitive rules in the home selling arena.

Agreement Ratified between the Canadian Real Estate Association and Canada’s Competition Bureau Assures Homeowners Increased Options

CREA The Canadian Real Estate Association

After several years of discussion, investigation and debate with the Competition Bureau of Canada, the Canadian Real Estate Association’s 101 board representatives voted in overwhelming favour on an agreement that aims to eliminate anti-competitive rules in the home selling arena. The agreement, passed October 24, 2010 in St John’s, Newfoundland, will be in force for the next 10 years, meaning an end to discrimination against real estate agents opting to offer mere postings on the Multiple Listing Service (MLS).

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Canadians: Start Making Use of the Tax-Free Savings Account!

Tax-Free Savings Accounts have been available to Canadians for two years, yet only one third of Canadians have opted to open one for themselves.

Despite the advantageous investment vehicle the Bank of Canada affords Canadians with the Tax-Free Savings Account (TFSA), a recent survey has found that the majority of Canadians are choosing not to utilize these benefits.

The countrywide survey, commissioned by ING Direct and conducted by Angus Reid Public Opinion, found that of Canadians polled, more than half did not have a TFSA and nearly 15 per cent had never heard of the tax-efficient investment opportunity.

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Big Bank Launches Collateral Mortgage to Spur Market; Takers Will Be Bound

What is TD’s strategy to stay afloat in a competitive mortgage market which has seen the Canadian home buyer’s business increasingly shifted towards mortgage brokers?

Despite all-time interest rate lows, the Canadian mortgage market has started to see a cooling; especially for big banks and in major cities Toronto and Vancouver.

And what, you may ask, is TD’s strategy to stay afloat in a competitive mortgage market which has seen the Canadian home buyer’s business increasingly shifted towards mortgage brokers? As of October 18, 2010, all mortgages issued by TD Bank will be collateral mortgages.

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Diversification Fosters Satisfaction in Investment Portfolio

You portfolio will benefit greatly from a blend of investments that remain liquid and accessible in addition to others that build slowly, locked-in, over the long-term.

In August, 2010, a study conducted by Ipsos Reid on behalf of RBC Direct Investing found that of those investors who considered their portfolios diversified, 61 per cent said that their portfolio was performing as well as they expected and 19 per cent said that it was outperforming their expectations.

More female investors (22 per cent) than male (17 per cent) considered their portfolios to be diversified, while of the 631 Canadian online brokerage clients who were active in trading during the preceding six months of the study, thirty per cent did not consider their portfolio to be diversified or did not know if it was.

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CMHC Allows Commercial Financing up to 85 per cent

With the Canada Mortgage and Housing Corporation’s multi-unit insurance coverage, a commercial investor can attain up to 85 per cent financing toward their commercial purchase.

Energy-Efficient Properties Eligible for Premium Discount

Amassing the 25 per cent down payment that most commercial mortgage products require for commercial properties can be difficult. But with the Canada Mortgage and Housing Corporation’s multi-unit (5+ units) insurance coverage, a commercial investor can attain up to 85 per cent financing toward their commercial purchase. This includes financing and coverage for retirement dwellings, licensed care facilities, condominium construction and student residences, new or existing, Canada-wide.

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Paying off your Mortgage before you Retire

More than half of the baby boomer generation has paid off less than 50 per cent of their current mortgage.

A rising number of Canadians would like to see their mortgage paid in full prior to the commencement of their retirement. The Royal Bank of Canada (RBC) conducted a survey in 2007 that found 66 per cent of Canadians considered it important for their home to be paid off before they retired. That number has risen to 77 per cent of the baby boomers surveyed in the latest poll conducted by TD bank.

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Green Commercial Ventures Receive Federal Funding

Construction loans and land development financing is available to fund capital costs. Construction mortgages can provide up to 75 per cent financing.

Green Developments Receive Federal Funding

A south Ottawa community has been named as the second of six winners that will receive federal development funding toward their sustainable community development project. In a national push to raise environmental standards and encourage energy efficiency, the Canada Mortgage and Housing Corporation(CMHC) and Natural Resources Canada(NRC), under the Government of Canada’s ecoACTION program, launched its EQuilibrium Communities Initiative in June, 2009.

Equilibrium is a three-year, $4.2-million national competition that will “select projects that will work to improve community planning and develop healthy sustainable communities that are energy-efficient”.

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Capitalization Rates: What they mean to Commercial Purchasers

The capitalization or ‘Cap Rate’ is a valuation used to give commercial buyers a more inclusive estimate of a commercial property’s value as oppose to, say, a gross rent valuation.

What is a Cap Rate?

The capitalization or cap rate is a valuation used to give commercial buyers a more inclusive estimate of a commercial property’s value as oppose to, say, a gross rent valuation. The cap rate incorporates a property’s selling price, gross rents, non rental income, vacancies and operating expenses.

A cap rate ratio is deduced by dividing the annual net operating income of a commercial property venture by the commercial property’s sale price or current market value. The annual net operating income equates gross lease income after fixed and variable costs have been subtracted.

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Utilizing the Reverse Mortgage to its Maximum Wealth Management Potential

A reverse mortgage frees the equity you have built in your home with very little out of pocket expense – as little as $300 to $600 so long as no title issues are attributed to your property.

Despite what the name may imply, a reverse mortgage is not completely irreversible. If you choose the wrong product or spend the funds it generates without any strategy directed to a sustainable retirement, you could notice the equity you have worked hard to build in your home quickly dwindle. That is why it important to examine your current budget, your objectives for the future, the costs of services or other items you require, and your reverse mortgage options in advance of your cash flow need.

A reverse mortgage frees the equity you have built in your home with very little out of pocket expense – as little as $300 to $600 so long as no title issues are attributed to your property. None of the released funds are due back while you or your spouse continue to dwell in the property, nor will they be taxed, nor will they interfere with any pension, Old Age Security or Guaranteed Income Supplement you may be entitled to receive.

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Private Commercial Lenders Provide Alternate Route for Commercial Funding

Private commercial lenders, particularly in the commercial mortgage market, are increasingly becoming the go-to for hard-to-fund commercial projects.

When big lenders, banks, insurance companies, and other financial institutions say the wells are dry for commercial lending, another group of financiers offer a spring. Private commercial lenders, particularly in the US commercial mortgage market in Ontario, are increasingly becoming the go-to for hard-to-fund commercial projects.

Alternative, or non-traditional, commercial financing can mean funds loaned by wealthy individuals, investor capital pools, limited partners, mortgage investment corporations (MICs) or even hedge funds. Private lenders tend to charge higher interest rates than conventional commercial lenders, sometimes upwards of prime plus eight per cent, and fees of one to five per cent of the total loan value, but they also tend to take on projects that conventional lenders will not.

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