Kitchener Waterloo Mortgage Source

The Canada Mortgage and Housing Corporation (CMHC) Housing and Mortgage Market Outlook – Fall 2008

This is the most accurate and reliable report available to us in the area. It examines local, KW, Cambridge and Guelph economic trends and how these trends relate to housing and mortgage prices. I have summarized the main ideas of the report here, but a link can be found at the end of the article that contains the full material.

New Home Market

Housing starts in KW and Guelph will diverge in 2009. Specifically, housing starts will increase to 2,650 in 2006, a 4% increase from 2008. Guelph starts will shrink by 3% to 890 in 2009 from in 2008. For the area as a whole, rising house prices, a well supplied resale home market and uncertain economic conditions will combine to keep housing starts lower than levels seen in the first half of this decade.

Resale Home Market

The resale home market will continue to moderate in 2009. Sales of existing homes will lower by 6% to 6,100 units, down from 6,500 units in 2008. This said, the price of housing will continue to increase as will be expanded upon momentarily. The report states that “Rising house prices, uncertainty about the economy and the satiation of demand will dampen existing home sales in 2009”. Part of this is due to the mortgage options made available in 2006 that allowed first time home buyers to purchase homes earlier than they would have otherwise. This said, “the price advantage of resale over new, more selection, and continued population growth will combine to keep existing home sales at strong levels, but below record 2007 levels”. Upgrading to larger home will continue to be a trend throughout 2009. This is in part due to rising local incomes and sustained increases in home equity values. Specifically, the average price of existing homes will increase by 2% in 2009.

Economic Trends

Economic growth in KW-Guelph will be flat in 2009. In Kitchener Waterloo, employment will increase by less than 1%, while in Guelph it is forecasted to decrease by less than 1%. In either case, employment in the area will be much stronger than the Ontario average. “Over the next year, job growth will lead in the high tech sector, as well as in education, trade and construction sectors, in KW. These sectors are creating higher paying jobs. On the other hand, the manufacturing sector, and its largest sub sector, the auto industry, will continue to face challenges”. Overall, weekly earnings are expected to increase by 2% in both KW and Guelph in 2009. The growth in high tech, education and construction will be responsible for this increase.

 

Mortgage Rates

Mortgage rates should remain within 25-50 basis points (.25%-.50%) of their current levels throughout the rest of the year. In the first half of 2009, rates should decrease slightly as the cost of credit to financial institutions eases. However, rising bond yields will force mortgage rates higher in the second half of 2009. For the rest of 2008 and throughout 2009, mortgage rates will remain at historical lows. The strong economic benefits of home ownership will sustain for the unforeseeable future.

 

Mortgages and Identity Theft

Identity Theft

The mortgage industry has become a hot area for fraud. This, unfortunately, makes sense since such large amounts of money are involved. The central medium that fraudsters use for the achievement of their crimes is Identity Theft. Moreover, some Mortgage Brokers and Agents employ sloppy client privacy policies that help contribute to this problem. Put simply, a fraudster can steel your identity, take out a mortgage in your name, and ultimately ‘abscond’ with much of that money. This happens to the tune of over $1 Billion per year in Canada. What makes things even worse is that these fraudsters are very difficult to catch, and in many cases, it is very easy to accomplish. It’s one of those things that doesn’t happen to everyone, but it does happen to some. After reading this article and applying the advice, you can be more assured that it will not happen to you  

What, more specifically, is Identity Theft?

According to the Canadian RCMP website, identity theft is, “… the stealing, misrepresenting or hijacking the identity of another person or business and provides an effective means to commit other crimes”. For it to be accomplished, “vital information such as name, address, date of birth, social insurance number, and mother’s maiden name need to be acquired... The identity thief can take over the victim’s financial accounts, open new bank accounts, transfer bank balances, apply for loans, credit cards and other services, purchase vehicles, take luxury vacations, and so on”.

How do I prevent it?

In order to prevent Identity Theft and the resulting nightmare it would cause for you, follow this advice:

- Do not carry your SIN card in your wallet. This card is equilivant of your financial DNA, and if it gets into the wrong hands, unimaginable damage can be done to you. Memorize the number or keep the card at home.

- Shred your sensitive documents before putting them in the trash. Fraudsters are likely to check your garbage for letters that carry personal information when preparing to steal your identity.

- Sign all credit cards when you receive them and cancel ones that you don’t use.

- Never leave receipts around, destroy personal info that you don’t need.

- NEVER give your SIN or banking info over the phone.

- Ensure that the Mortgage Broker, or any one else that handles your personal information, has a good privacy policy and privacy control measures. Don’t be afraid to ask questions about how your information is treated.

This last part about ensuring that your partners in finance use the same, or better, diligence that you use is very important. Not all Mortgage Professionals use high levels of diligence and this is contributing to the over $1 Billion in fraud found yearly in Canada. Feel free to post any questions or comments below, or give me a call for more information on how to protect yourself against identity theft.