Holmes Has The Answers To All Your Questions!
January 2012 Market Statistics
City/Town New Listings Number of Sales Average Price
Brampton 879 491 $386,210
Caledon 96 32 $620,934
Milton 165 86 $433,312
Mississauga 1,070 537 $433,824
Oakville 254 118 $588,469
Orangeville 95 54 $414,713
Market Watch Update
January 2012 home sales were up almost 9% compared to January 2011. Affordability and very low posted fixed mortgage rates has kept home ownership achievable. Strong market with better supplied inventory is expected for the next few months.
Government Incentives for Buyers and Home Owners
Minimum Down Payment Required
A minimum down payment requirment of 5 per cent to purchase a home. Some qualifications will apply.
RRSP Home Buyers Plan
The Registered Retirement Savings Plan withdrawl limit for the RRSP Home Buyers Plan is up to a maximum of $25,000.00 for each buyer to buy or build a home providing buyers are first time buyers. The egilibility and repayment rules are as follows. The money withdrawn from the RRSP must be repaid over a period of no more than 15 years to retain its tax deferred status. The repayment starts the second year following the year the first withdrawals were made. For example, in October 2009 a first time buyer withdrawls $24,000 from his or her RRSP to finance the purchase of a home. Their first annual payment of $1,600.00 ($24,000 divided by 15 years) is due by December 31, 2011. For further information, please call Tracey today.
Amortization Extended
The amortization on mortgages has been extended up to a 35 year amortization. Some qualifications may apply.
Land Transfer Tax
Did you know that First Time Home Buyers who have never bought a home or had ownership interest in a home anywhere in the world, at any time are eligible to receive up to a maximum of $2,000.00 Land Transfer Tax Exemption when purchasing a resale or new home. Some qualifications do apply. Call Tracey for more information on this great program before it's no longer availalbe.
Harmonized Sales Tax - How does it apply to Real Estate?
The Harmonized Sales Tax (HST) took effect this year on Canada Day July 1, 2010. The new tax combines the former GST and PST into a single 13% sales tax. In regards to real estate home buyers and sellers will have to pay extra tax on services associated with the real estate transaction such as legal fees, moving costs, real estate commissions and home inspection fees. The good news is that HST will not apply to the purchase of resale real estate, residential rents and condominium fees.
HST New Housing Rebate Program
The purchase price of newly constructed homes are subject to HST. The good news is that buyers may be eligible to claim a rebate for a part of the HST they pay on the pruchase price of a newly constructed home or the cost of building your own home.
- If you buy a new or substantially renovated home (including land or if you lease the land) from a builder.
- If you or a contracter construct or substantially renovate your own home or carry out a major addition.
- If your home is destroyed in a fire and is subsequently rebuilt.
New home buyers can apply for a 36% rebate of the GST (Federal portion of HST) applicable to the purchase price to a maximum of $6,300.00 for homes costing $350,000 or less before GST. For new homes priced between $350,000 - $450,000 before GST, the GST rebate would be reduced proportionately. New homes priced $450,000 before GST or higher would not receive a rebate.
New home buyers can apply for a 75% rebate of the PST (Provincial part of HST) applicable to the pruchase price to a maximum of $24,000. Call Tracey for further information.
Changes to Mortgage Insurance Rules!
The honourable Jim Flaherty, Minister of Finance, announced a number of measured steps to support the long-term stability of Canada's housing market and continue home ownership for Canadians.
- Require that all borrowers meet the standards for a five-year fixed rate mortgage even if they choose a mortgage with a lower interest rate and shorter term. This initiative will help Canadians prepare for higher interst rates in the future by not taking on too much debt, which will improve the stability of Canada's housing market.
-Reducing the maximum amortization period for government insured (default insured) mortgages. The maximum amortization for all new default insured mortgages will be reduced to 30 years from the current 35 years. This change will help reduce total borrowing costs for consumers, helping them to build up more equity quickly.
- Lower the maximum amount Canadians can withdrawl in refinancing their mortgages to 85 per cent from 90 per cent of the value of ones homes. This change will help to promote savings in homeownership and ensure that homeowners don't become overextended by using all of the equity they have built up in their home when refinancing.
- Withdrawing government insurance backing on lines of credit secured by homes. Home equity lines of credit generally offer a variable interest reate and often have no repayment terms associated with them, which exposes borrowers to an increase in interest costs should interest rates rise as expected. Due to an increase in the household debt associated with these loans, the federal government wants to limit the amount of equity for which these loans can be granted. Loans that have repayment terms associated with them will still be eligible for default insurance.
- Require a minimum downpayment of 20 per cent for government-backed mortgage insurance on non-owner-occupied properties purchased for speculation.
- Canadians are required to insure their mortgages if they make a down payment of less than 20 per cent of the value of the home. There were no further changes to down payment requirements.
These changes will come into effect on March 18, 2011
Nick Tavernese,
Senior Account Manager,
Residential Mortgages, Greater Toronto Region
Royal Bank of Canada
Tel: 905-495-4488
Fax: 416-352-1398
Cell: 416-573-2641
or feel free to email Nick anytime at: nick.tavernese@rbc.com
With Tracey's help, they found their dream home. With mine, they found the right financing. Let's create the "house of your dreams"
Nick Tavernese
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