Pre-approvals and rate holds have been a standard offering with most lenders. I recently received a newsletter from a mortgage broker I work closely with in Toronto [Rosanna Younan from Premiere Mortgage Centre], informing me that two big lenders, TD and FirstLine have decided to stop pre-approvals within the broker channel. The big question is whether the majority of lenders will follow the lead.
Canadianmortgagetrends.com highlights some lender concerns regarding pre-approvals:
pre-approvals frequently don't close (less than 1/3 of pre-approvals close)
pre-approvals are expensive to process and the return for lenders is debateable. The lender is tying up human resources to process applications, as well as capital to hedge rates.
The next few weeks/months may see the trend continuing or lenders may start charging a rate premium on pre-approvals (presently the policy with a few).
Many good lenders are currently still offering preapprovals and more the reason for anyone considering a purchase or refinance, within the next 4 months, to arrange for a rate hold.
Would mortgage pre-approval/ rate hold become extinct?
We often see on MLS listings "Seller or Agent do not warrant retrofit status of basement", and if there is no mention that the unit is legal, it's probably not . The legality of basement apartments or converted rental units (i.e. granny flats, in-law suites, accessory apartments, non-retrofit units) are often in question, considering there are tens of thousands of basement apartments currently in the City of Toronto.
Under certain zoning by-law, basement apartments are permitted in single family homes as long as it meets certain requirements. In order to assist home owners, the City have a kit which will explain "how to create a legal second suite" through Access Toronto at 416-338-0338 or can be obtained at the desk. There is also an alternative site which provide a more detailed explanation of the physical requirements to meet building codes at Carson Dunlop Home Inspection and Consulting Engineers.
For anyone thinking of buying, selling or retrofitting a home with a basement apartment, These are the typical 4 questions to ask:
1. Does the zoning by-law in your area permit a basement apartment unit?
2. Does the retrofit meet fire code and minimum building code requirements (i.e. minimum ceiling height, fire rated walls, entrance sizes, egress, provision of parking spot etc.) ?
3. Does it meet the basic electrical safety requirement?
4. Has the unit been registered with the City and has a certificate of compliance?
We are all aware that human population growth in particular at urban centres will impact future supply of food, our environment and the ecosystem. According Census, the Greater Toronto area grew by over 450,000 people between 1996 to 2001 to over 5 million people. How can we utilize the concrete jungles of urban centres to grow food?
The idea of doing intensive hydroponics agriculture in urban hi-rises, where the buildings recycle their own water, and produce their own power.
The concept of Urban Vertical Farming and Skyscraper Farming may soon change the concept of urban food production, where we will live and work close to inner city urban organic farm. The idea may seem far-fetched right now, but maybe it's time to get serious to turn vision into reality.
Tyler Brule, the Financial Times Columnist published the Monocle Quality of Life Index for the most livable cities in June 2008. The selection is based on a number of criteria, as well as business and cultural diversity. Urban dwellers wish list include walkable sustainable neighbourhoods, shops and amenities within walking distance to home, green space and parks, good transportation system, cafes, a smorgasbord of living.
Curious to see the Monocle Quality of Life Index, go HERE.
For those planning to enter the real estate market within the year, the announcement of the combined sales tax will have implications on the following:
· adding significant tax to services such as moving costs, legal fees, home inspection fees, mortgage insurance premiums, title insurance, REALTOR® commissions and other professional fees; and,
· adding significant tax to the purchase price of newly constructed homes above $500k (make sure it's clear in the contract who pays this, you or the builder).
The new levy will take effect July 2010.
Related Articles:
Another burden for home owners
Blended tax drives up cost for both new and resale home buyers in Ontario
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