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Dear Friends,
Has everyone had enough snow and rain yet???
The weather is keeping the real estate market quiet.
We want to take a moment to share the change to mortgage down payments put into effect by the federal government this month. The main objective of this change is to cool some of the markets which are currently having extreme price increases, such as Vancouver and Toronto. Also, this will help to ensure that homeowners will have sufficient equity in their home if the market swings out of their favour.
The federal government has increased the minimum down payment required for homes above $500,000. Under $500,000 and over $1,000,000 remain the same with 5% and 20% respectively. For homes above $500,000 there is an additional 10% due on any portion above $500,000. For example:
A home that is $600,000 will have the down payment calculated as shown here: ($500,000 x 5%) + ($100,00 x 10%) = $25,000 + $10,000 = $35,000.
Again, we expect that this will have the largest impact on markets such as Vancouver and Toronto, while having little effect on the sales in Ottawa which has very stable growth,
Sincerely
Dana Palombo For The Rachel Hammer Team
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