Thursday, November 21, 2013

A little reassurance from Stephen Poloz

There has been so much industry chatter going on lately on whether or not there is or isn't a housing bubble in Canada, my head is spinning. Now the Governor of the Bank of Canada has weighed in on the issue stating that "our judgment is (the housing market) is a situation that is improving, this is not a bubble that exists here that would have to be corrected".
Whether it is, or isn't remains to be seen. But, I'm going to go with Steve on this. He runs the show!

Thursday, November 14, 2013

Buying a home: 1950s vs today

Ever wonder what it was like to buy a home in the 1950s? Sure, houses were much cheaper back then, but credit wasn't as readily available. Mortgage default insurance, which today allows homebuyers to put less than 20% down, was just getting rolled out - and chartered banks were just invited into the mortgage lending industry.
Despite all the differences, a lot of things remain the same - as is evident in this 1959 article in Better Homes & Gardens entitled "The Smart Way to Buy a House". 
While today it's easy to forget these basic home buying principles, most of them can still be applied to today's house hunt.
For example, the whole idea of being systematic - analyzing "your family's needs and desires, knowing what you can afford and setting your sights on the best house your money can buy" - is solid advice. It's always helpful to establish a comfortable monthly budget and then working backwards to find out how much house that can get you. That being said, the article's advice to take that monthly number and multiply it by 100 to establish your ideal mortgage amount, isn't always realistic - especially in some of Canada's hotter markets.
With housing markets across the country maintaining their hot streaks, homebuyers have to pick and choose which features are deal breakers - and which aren't. While this seemed to be the same in the 1950s, the definition of a "deal breaker" may have changed a little. For example, I think most homeowners today would be willing to overlook a laundry area that isn't "a pleasant, well-lighted place in which to work". But we could be wrong there.
Have you ever talked to your parents/grandparents about their first home buying experience? What differences stood out most to you?