New Mortgage Rules!

Thanksgiving…What the heck is there to be Thankful for…

New Mortgage Rules…

The economy is bad, the real estate market is slow, prices are still down, prices for groceries are still crazy high and not going down anytime soon. Need to buy a car, prices there are insanely high as well. If you have kids, just trying to feed them is getting really expensive. If you’re on fixed income it’s getting harder and harder to make ends meet and maintain the lifestyle you worked your whole life for. There are more and more people coming to this country, not paying taxes that we have to support and pay for. Almost every level of gov’t doesn’t look like it cares about us at all and is just working for themselves and their best interests, not ours…Etc…Etc

So, exactly what the H*LL is there to be Thankful for this Thanksgiving??

Well, you’re not wrong, there is a lot that is going on right now.

However, this Thanksgiving I’m going to be thankful for a number of things.

I’m going to be thankful that I’m a husband and this year I will be celebrating 22 years of marriage to my lovely wife. When I look back over the years my life just wouldn’t be the same and I can’t imagine where I would be without her.

I’m going to be thankful that I’m a Father. As some of you know I have two sons, one in 2nd year university and the other half way through high school. As a parent there is a ton of things we sacrifice to make sure the family is taken care of. I know as a father the hours spent away from home working to pay the bills and provide everything they need. Paying for the hockey tournaments, family vacations, those little things like going to the movies or dinner out every now and then. Even though I have moments where I’m sad over all the things I missed with my boys while I was working to provide for them, I realize that I’m still blessed to have two great kids.

Those of you who have older kids know exactly what I’m starting to go through. My oldest in 2nd year may not be home again until Christmas as he starts his real life. While I’m so very proud of that its also so hard as a dad not being able to be there. However, I’m thankful that I have raised a son that is able to stand on his own two feet and be strong enough to focus on what he needs to get done to accomplish his goals.

I’m going to be thankful for my friends. I’m sure we all have those friends that you may not see or talk too in months but when you do connect its like it was just yesterday that you hung out. You may have met them in grade school or university or maybe you grew up on the same street as kids. Whatever it is, you know those friends will always be there for you and you for them.

I’m also going to be thankful for is you. Everyone one of you who spend the time to read this Newsletter. I can’t tell you how honoured and privileged I am that you choose to spend a bit of your precious time with me. If there is any topic you would like me to discuss please let me know at 2neilodonnell@gmail.com and I would be happy to do so. If you have been enjoying the crossword contest that’s great. I was thinking for next year perhaps we switch to a Sudoku puzzle contest. Let me know what you think, stick with the crossword or change to a sudoku puzzle contest each month. Or maybe we switch back and forth each month. One month crossword the other sudoku. Love to hear what you think.

While there is a lot that could be better in this world, I’m going to choose to focus on and be thankful for the little things that really matter…Family and friends. The things that really make life great.

Ok, now let’s talk about Real Estate and specifically the new mortgage rules just announced. 😊

There were 3 main items the government announced and here they are:

#1: Help for First-time Buyers

As of December 15, 2024, insured first-time home buyers (in other words, with downpayments of less than 20%) will be able to amortize their mortgage payments over 30 years (instead of 25 years). By spreading repayment back over a longer period of time, borrowers benefit from lower monthly payments – and may be able to borrow more than they could previously.

For example: A first-time buyer buys a property for $800,000 with a 10% downpayment. At a 4-year fixed interest rate of 4.09%, the mortgage payment decreases by $362 monthly, when amortized over 30 years instead of 25, from $3,822 to $3,460.

If you aren’t a first-time buyer, you can still amortize your payments over 30 years IF you have a downpayment that’s 20% or more of the purchase price.

#2: Help for Buyers with Down Payments of Less Than 20%

In Canada, homebuyers with down payments of less than 20% need to get mortgage insurance (for example, through CMHC). Before today’s announcement, the only properties that were eligible for the mandatory insurance were those priced under $1 million – which seriously restricted the properties that could be purchased in a city like Toronto.

As of December 15th, 2024, would-be homeowners will be able to qualify for mortgage insurance for properties priced up to $1.5 million. This is HUGE news for the Toronto real estate market!

So why this matters to us is because its those Sellers in the GTA that are moving here to buy. Without people being able to buy in Toronto there is no one to come here and buy.

#3: Help for Buyers of Newly-Built Homes

Earlier this year, the government announced that first-time buyers of new condos and houses (‘new builds’) would be able to stretch their payments over 30 years instead of 25 years. Today’s announcement expands the longer amortization to ALL buyers of new builds, effective December 15, 2024. While this will certainly help buyers looking to buy pre-construction condos and houses, the real goal here is to help the struggling pre-construction industry and encourage builders to keep building much-needed homes.

We are also expecting 2 more rate decreases between the beginning of October and Christmas with more to come in the new year. I expect the fall market to continue to be a bit slow (its perfect time to buy) but the spring will definitely heat up with the rates decreasing. So, if you are thinking about buying you should target doing that before mid February and if you’re selling we should talk so you can be ready for the spring market.

I hope you and yours have an amazing Thanksgiving and a wonderful October 😊