Show info for July 6, 2007:
Dave Currie from MonsterMortgage.ca answered a call from a viewer who was renting but was considering buying a home with no down payment and a 40-year mortgage.
“(Cindy’s rent is) $1,300 a month. At the end of 12 months, what does Cindy have to show for rent? Nothing. And if the fact is she does not make any payments, she’s not going to be renting very long either. So what I’m really saying is that it’s a positive rather than a negative. It gets her into it. At least she’s building wealth for herself, and rather than paying rent, she is paying down her mortgage, and she always has the prepayment options that are available. If she increases her payments, that knocks it maybe down from a 40 to a 38. So you can always have that option by increasing your payments and getting it paid off quicker.”
Dan Ellenberg from sellwithdan.com answered a viewer’s question about fees – for example the proposed increased land transfer tax by the city – for homebuyers and whether they can be rolled into a mortgage:
“What I can say is that that hasn’t really been decided as of yet. When the insurance premium is rolled into the mortgage, if you want to put it that way, the bank is financing that additional amount. Is the bank going to be interested in financing an additional amount in order for the city to get that money? I’m not sure it really makes a difference to the bank,” Ellenberg said. “It will all depend on what relationship the city can work out with individual banks and the mortgage community. But I guess the easier answer would be not to have that tax so we don’t have to worry about it. But it definitely would be a very important thing to consider and a great question in terms of keeping affordability in check, especially for the first time buyer.”
Scott McLellan from Tridel talked about condo sales numbers for spring and the fact that the market hasn’t cooled off as some predicted.
“In (May) ’06 we were 7,100 condominium sales, at the end of May in ’07, it’s just under 7,300. So that’s up a few percentage points,” he said. “We know that with the openings, the brand-new openings that have happened across the Greater Toronto Area in the month of June that the numbers are going to surpass the numbers from ’06 and potentially pass the numbers of ’05.”