Bullwhip29 points out an article that says the BC first time buyer loans program will likely cost the government twice as much as they claim.
“The Ministry of Finance estimates that for every dollar of loan proceeds under HOME, taxpayers will lose about 19 cents in administrative costs and foregone interest. This estimate ignores the cost of default losses that may arise if borrowers are unable to repay their loans.”
Read the full article here.
Are you a first time buyer looking for a mortgage? BMO wants your business and will give you back $1000 of your own money if you choose them.
Under the new promotion, first-time home buyers taking out insured mortgages with terms of at least four years are eligible for $500 cash on mortgages of less than $250,000, and $1,000 on larger loans. Once the mortgage is booked, the cash is credited to the customer’s BMO chequing account.
In a statement, BMO called its new offer a “timely” companion to a new interest-free loan program British Columbia’s provincial government launched to help new buyers cobble together down payments amid soaring housing prices.
Read the full article here.
The new BC government interest free loans program for first time buyers might help to get some more condos sold. Certainly real estate developers in this province tend to be in agreement with government policies, showing their appreciation by holding 8 of the top 10 liberal donor spots:
Eight of the 10 top donors to the B.C. Liberal party in 2016, and so far in 2017, are involved in the province’s property development and construction industries.
Combined, the eight donors contributed nearly $1.5 million of the $12.5 million collected by the Liberals during the period, an analysis by Postmedia News of the donor list released by the Liberals last week shows.
Some of the real estate development and construction sector donations came in six-figure instalments.
At least this booming real estate market is creating lots of jobs right?
Well, not as many as Quebec which created more full time jobs than any other province and accounts for 42% of national labor growth in 2016.
If you own a small run down million dollar house in Vancouver, let’s take a moment to thank the renters who help pay for some vital services, like the new first time buyer loans and the homeowner grant, the cap of which has just been raised to 1.6 million.
“This is a remarkably lousy policy,” said Thomas Davidoff, head of the University of British Columbia’s Centre for Urban Economics and Real Estate. “You’re going to take money from people who don’t own homes and give it to people who own homes. That seems to be a step exactly in the wrong direction if the dominant issue is affordability.”
Read the full article over at Bloomberg.
Despite widespread criticism of the BC governments plans to make teaser loans to first time homebuyers (worst idea everrrr) Kirk Lapointe points out that not everyone thinks its a bad idea.
I would wager that for every Christmas dinner gathering of finger-wagging and tut-tutting about the fiscal irresponsibility and market impact of the Clark manoeuvre, there were a dozen families seriously discussing if this was the time – perhaps the last real window – to get the kids into a home in the same city.
Politics ain’t always about what makes the most sense.
Read the full editorial here.