CMHC & Genworth increase mortgage insurance premiums.

An article over at the Financial Post by Garry Marr asks if recent hikes in mortgage insurance fees are targeting first time buyers.

The move by Genworth Canada, which matches an increase announced Thursday by Canada Mortgage and Housing Corp. will raise insurance costs by 15% for those Canadians with the highest debt-value mortgages allowed by Ottawa.

Of course lets keep things in perspective here – that 15% increase may result in an extra cost of about $5 dollars a month.

You’d have to be really stretched for that to be an issue.

Rob McLister, founder of ratespy.com, said insurers are padding their margins and doing it for loans that usually result in the least amount of money recovered during defaults.

Read the full article here.

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Son of Ponzi
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Son of Ponzi

patriotz Says:
April 7th, 2015 at 8:22 am 74
@71: “The insurers have no way to surgically apply it there [Vancouver and Toronto] alone.”

Sure they do. Instead of imposing the premium based on down payment %, impose it based on price.
——————-
Agree.
It’s always been the pracise that the more the risk, the higher the premium.
In same cases, where the risk is to high the insurers may decline coverage.
As is the case in Richmond for flood and earthquake coverage.

Oracle
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Oracle

Anyone with half a brain can see that CMHC’s public servants raised this to help out the private sector insurers such as Genworth.

CMHC is a minor player for new originations. Genworth is a major player now and this helps its stock price.
Private sector doesn’t want competition from CMHC. The cronies at the CMHC are there now to help Genworth.

hmnhrmmm
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hmnhrmmm

I’m not sure if this real estate video has made it here yet, but it’s priceless. So true, on so many levels.

https://www.youtube.com/watch?v=wcAMtvNfp78&feature=youtu.be

patriotz
Member

@previous: ” And can you imagine if we gave the keys to develop False Creek to the civic or municipal governments of the day? ”

Don’t have to imagine – the very first redevelopment in False Creek was done by the City of Vancouver on the South Shore between Granville and Cambie in the 1970’s. By a leftish city council to book. And the City still owns it and gets leasehold revenue. Guess you didn’t know that.

“Instead we have a vibrant neighbourhood that is a model for urban designers around the world.”

Sure do – False Creek South won numerous awards and became the model for similar developments around the world – including Concord’s False Creek North.

supersogs
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supersogs
Shut It Down Already
Guest
Shut It Down Already

1, the premium is a percentage of the loan value. The percentage varies with the downpaymebt percentage.

2, Genworth also raised their premiums.

Both were pointed out on the previous thread.

elvince
Guest
elvince

On a completely different subject, the Fed Govt will raise the amount for tsfa to 10k$/year.

Honestly, who wants to buy a condo and rent it while they could just as well invest their money in a REIT (supposing the guy wants to stay in RE) and pay no taxes on the profits.

Any way to put your rental RE in your tsfa? I don’t think so but I’m no expert.

VanRant
Member
VanRant

@ #5
The americans are not stupid, they just had gone through a bubble of their own. The properties in the states had been decimated so there are bargains galore. Why would they buy into a bubble in Canada while our dollar are still tanking. Its another real estate supported media pumping.

patriotz
Member

@7: “Any way to put your rental RE in your tsfa?”

Why would you want to? You wouldn’t be able to deduct the losses against your other income.

Of course you can buy REIT’s in a TFSA, they buy in different sectors where it’s possible to make a profit.

RFM
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RFM

Canada’s glaciers to shrink by more than two-thirds by 2100, study finds.

A full report at http://vancouverpeak.com/showthread.php?tid=5306

southseacompany
Member
southseacompany
“Higher mortgage insurance premiums could hurt first-time buyers: economists”, CTV News http://www.ctvnews.ca/business/higher-mortgage-insurance-premiums-could-hurt-first-time-buyers-economists-1.2315550 Oh yeah… like 15 years of some of the lowest interest rates in a century have helped make homes affordable. Let’s see the quotes; “Some realtors and economists say higher mortgage insurance premiums introduced recently by Genworth Canada and CMHC could cause first-time homebuyers to delay their purchases.” “”It’s certainly going to bite into first-time, low-equity homebuyer sales,” said Helmut Pastrick, chief economist with Central 1 Credit Union.” “”I don’t expect a major impact on housing sales activity as a result of this change, but at the margin, it will slow first-time buyer sales to some extent.”” “But Ron Hollet, a Halifax-based broker with Re/Max Nova, says he expects the changes will force a number of first-time buyers out of the market.” “”Then what happens is it’s a… Read more »
patriotz
Member

@11: “If the first-time homebuyer doesn’t come in to the market, then the guy who owns that house can’t move to a new one.”

So can’t any of these “experts” come to the logical conclusion, which is that prices will then have to come down across the board?

” we are making it more difficult for young people to pursue their dreams of home ownership, and I think that’s a dangerous thing. ”

Oh I see they have, they’re just using code language. For anyone in the FIRE sector, lower prices are a “dangerous thing”.

Slagathor
Guest
Slagathor

…@7: “Any way to put your rental RE in your tsfa?”

Why would you want to? You wouldn’t be able to deduct the losses against your other income….

LOL, isn’t that the sad truth.

patriotz
Member

Global supply glut threatens British Columbia’s LNG projects

Most liquefied natural gas export projects are at risk of being cancelled in North America as a result of a looming global glut of LNG, putting a damper on British Columbia’s energy dreams.

Moody’s Investors Service Inc. issued a stark outlook for the fledgling North American LNG industry, arguing it doesn’t make economic sense to invest billions of dollars on each venture especially as Asian buyers slow down their orders for new LNG supplies.

Oops.

Well if we can’t pump LNG, it’s double down on pumping RE.

paulb
Member
Active Member

Spring is here!

New Listings 477
Price Changes 138
Sold Listings 241

TI:13400

http://www.paulboenisch.com

vangrl
Member
vangrl
vangrl
Member
vangrl
http://www.biv.com/article/2015/4/mad-money-squeezing-more-locals-out-real-estate-ma/ “By Lane’s estimate, 75% to 80% of new homebuyers in his market are from mainland China. “Another 10% are builders for the Chinese market. As little as 10% are local buyers.” Our region has long been enriched by people from other countries moving here, but there are indications that some of this real estate investing is about moving money here, not people. “Many of these buyers are buying several properties, not just one,” said Lane. Although some of the newly purchased homes sit empty and some are rented out or leased back, Lane pointed out that buying multimillion-dollar homes for rental income doesn’t make financial sense. “Buyers are gambling on capital appreciation.” Or they want to protect their capital in a stable country. There is much to like about this buying spree. My friends who are selling are over… Read more »
Desdemona
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Desdemona

Here is an interesting listing in West Van
No pictures of the inside – bad sign. Then the Realtor’s description is:

Live in one of the best addresses in West Van, the 2600 block Palmerston. Surrounded by multi-million dollar new homes the potential here is limitless. Restore this grande french inspired home to its original glory or build your dreamhome on this flat south side RS4 zoned property with lane access. Stunning views to the South, East and West and sun all day long make this 64×120 property a one of a kind opportunity.

Surrounded by Million Dollar Homes??! The listing is $3 Million itself.
Bizarre Vancouver strikes again.

Corrupt in Canada
Guest
Corrupt in Canada

“80% of new homebuyers in his market are from mainland China”

Come on now, you don’t really believe that do you.

Shut It Down Already
Guest
Shut It Down Already

It said “multi-million” not “million”. And there are no pictures of the inside because it’s clearly a big restoration project or a teardown. It’s all in there if you care to read it.

Wearehere
Guest
Wearehere

@ vangirl – FINALLY the MSM are picking up what we are saying

“Real estate agents and developers in B.C. are the group that, by far, reported the least number of large cash transactions to Fintrac,” she said.

Mulroney, Canada’s ambassador to China from 2009 to 2012,argues that Canada needs to take tougher measures to block the influx of “hot money” pouring into real estate, particularly in Vancouver

Shut It Down Already
Guest
Shut It Down Already

CTV News earlier was doing a report on the return of US buyers. They mentioned that 10% of buyers at the new Trump building are from outside Canada.

Desdemona
Guest
Desdemona

@ 20

3 IS MULTI YOU FOOL>

THE GUY IS SAYING BUY THIS TEARDOWN HOUSE BECAUSE IT IS SURROUNDED BY MULTI_MILLION DOLLAR HOUSES.

Well guess what? The asking price is MUTILMILLION DOLLARS.

Now do you understand?

Wearehere
Guest
Wearehere

The answer is very simple EVERY HOUSE should have a tax return return associated with it.
If there is no tax return, or if the tax return shows an income less than 10% of the value of the home an instant audit is triggered by the CRA.

Shut It Down Already
Guest
Shut It Down Already

Desdemona, yes I got it the first time. There’s nothing strange about that listing at all. Others on that street are listed for 2x more than that teardown. 6 is also multi.

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