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Dear ,
We're already well into 2010 and visitors are already flooding into Vancouver for the Olympics.
It is fascinating talking to people about the Olympics; some are escaping the city, others think of it as a non-event and plan on doing nothing, while still others are anticipating attending events and taking advantage of all the cultural activities in and around Vancouver.
Businesses all over the mainland will be affected. Some will be hit hard, while others will thrive. Many real estate agents anticipate the real estate marketplace to either be dead or very very slow. Simply getting around certain areas of the city will make doing business a challenge.
Averbach Mortgages will be open for business as usual. Don't hesitate to call us with your questions.
In this month's newsletter, I chat about the current mortgage market and ways to save yourself a bundle. You'll also find the monthly real estate summary and a short list of Internet Resources that will help you get around the city during the Olympics.
Sincerely,
Mike Averbach and Justin Blacklock
CLICK HERE to See Current Rates
PS. As most of you already know, we were once again recipients of The Mortgage Group's Summit Award for 2009. Part of our award was a trip to a Five Star resort
in Mexico.
Here are Justin and myself along with Monique
Cornish and John Charbonneau. Be sure to visit the Blog to see what happens once we "relax" a bit!
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The Pressure is Off ... for Now!
Like
a yo-yo, bond yields (the main determining factor for fixed rates) have gone up
and down since last June, with constant threats of long term rate increases.
Each time there is a spike, we frantically submit new rate-holds. This buys an additional 4 months
for clients who have been sitting on the fence and mulling over the opportunity to
refinance with a reduced penalty on their current term.
The most recent spike came
in December when bonds went from the mid 2.4% range for a 5 year yield, all the
way up to the high 2.8% range and right back down again to where we currently
sit at 2.39%.
Anticipation of increased bond yields was most recently based on
projections for positive employment numbers. This did not happen and sent bonds spiraling down
once again.
With the pressure off for the time being, it begs the question,
when do you lock-in or refinance to take advantage of the 50 year low-rates like the ones we are
seeing today?
If you are currently riding a variable rate term, you are sitting
quite pretty. Locking in would mean at least a 2% increase in your current rate
-- but would give you peace-of-mind for 3 to 5 more years. While locking in is a very conservative
strategy, it's also a very responsible one. Find out if you can afford to make the
jump from variable to fixed by increasing your minimum payments on your
variable rate mortgage first. Then it won't be such a big shock
when you finally do lock in. That way you can continue to take advantage of the sub-two
percent rate and pay your mortgage down even sooner. It's a win-win plan.
When the pressure starts to mount again, we'll let you know to keep your finger on
the trigger.
Today, variable rate mortgages are as low
as Prime -.30 (1.95%). You still have the opportunity to lock into the best
fixed rate available at the time of conversion with our lenders so why not pay
less now?
This could equate to hundreds of dollars of savings. For
example, a $350,000.00, 35 year amortized mortgage for 5 years and 3.89% would
cost you $1520.00 per month. Compare this to the same term and amortization but at the
best prevailing variable rate. Your payment of $1149.00 gives you a savings of 371.00 per month. Let's
say you only ride this for about 6 months -- you'll save over $2200.00! Not exactly small potatoes.
The Bank of Canada is predicting that no changes to the overnight rate will occur
until after the 2nd quarter of 2010. Bank Economists are grumbling
about that being premature, which means the savings could be even more substantial.
We had a lot of comments about my email last month titled "When
Will the Bubble Burst?" Well, since then, The Bank of Canada
indicated that it was premature to be talking about a housing bubble in Canada
and said recent house price increases are in line with supply and demand
fundamentals.
The bank considers the current hot market to be a phenomenon
based on temporary factors, such as pent-up demand from the recession, and low
mortgage rates. A CIBC forecast released last Thursday indicated that the hot
housing market will continue to drive economic growth during the first half of
2010, but will come to a screeching halt in the second half of the year, when
interest rates are expected to rise.
We don't necessarily
agree that rates rising will cause a "halt" in the market. During the peak of the last market rise in May of 2008, rates were in the mid 5%
range and got lower and lower from there. Furthermore, the idea that HST is
causing a buying frenzy is also untrue unless you are talking about brand new
homes.
The HST (starting July 1st, 2010) does
not apply to the purchase of an existing home. The tax WILL be applicable
to the commission your agent receives for the sale of your home. The sales commission is considered to be a taxable service. Other home purchase services will also be affected (legal, home inspection, appraisal,
moving, etc).
As always -- please give us a call if you need any of your mortgage questions answered.
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Getting Around the Olympics
Here are a few resources that will help you navigate the Olympics:
The road closures have already begun. If you have to drive be sure to check for closures and restrictions ahead of time. Many of the major downtown routes will have Olympic Vehicles only lanes. You might decide to walk or take public transport instead!
Visit travelsmart2010.ca for road closures and parking restriction maps.
Want to share a ride? Find ride matches at ride-share.com.
Buses, Sky Train and Sea Bus maps and schedules
Did you know the Olympic Line is FREE?
The Olympic Line connects Granville Island to the Canada Line Olympic Village Station (Cambie Street and West 2nd Avenue) between January 21 and March 21, 2010.
For more information on the Olympic Line CLICK HERE
MAPS, MAPS AND MORE MAPS.
From walking tours and routes, to a public art map and transportation routes for transport trucks, to a half dozen city maps of various kinds. FIND THEM HERE
WHAT'S HAPPENING on and around the Olympics?
VANCOUVER2010.COM is the main website for the Olympics. You could spend hours on the site finding interesting stuff to do.
Information about the VENUES for both sporting and non-sporting events
CULTURAL FESTIVALS AND EVENTS
Not interested in sports, or want a good dose of culture too? There is so much to do you'll want to hire a social secretary. For your dose of culture CLICK HERE
Let's not forget about RICHMOND and WHISTLER
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January's Market Update
Every month we get a market update from
our friends at Macdonald Realty; Simon Clayton, Kristie Marsden, Jason
Low, Sandra Ens, Jason Feinstadt and Jenny Stephanson.
In January's update it looks like this winter's market may shape up to be unusually high, if trends continue.
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Averbach Mortgages
604-736-1855
We save you time. We save you money. We get you the you the best mortgage terms at the best interest rates possible.
If you are:
- purchasing your first home
- refinancing
- renewing an existing mortgage
- investing in real estate
- consolidating your debts
- experiencing current or past credit issues
We have the solutions that work for you.
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Mike Averbach
Averbach Mortgages |
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