Tips for Budgeting and Saving for a House Down Payment

Prior to buying a home, you need to assess the amount and source of your down payment funds and check in with a lender of choice to determine what kind of loan is best for you. You should work on getting your credit score as high as possible and create a reasonable budget so you can save the needed down payment funds.

There are down payment assistance programs that will help keep the size of your down payment to only 5 percent of the purchase price.

Plan on buying a home that fits your savings plan of an amount equal to 5 percent of the price. You can always move up to a larger home later as your equity grows.

It is not uncommon for all or part of a down payment to be gifted from a family member. This option may allow you to buy a home sooner than expected because your funds are immediately available.

To help save money to buy a home, have your bank set up an automated transfer of at least 10 percent from every paycheck to a separate account that is reserved for your down payment funds. Have your budgeting plan include reducing some of your more luxurious indulgences. Eat out less often, shop for more affordable getaways and evaluate how much you are spending on items you could really live without.

If you can find a way to increase your income, even if only temporarily, your down payment fund will grow even more quickly. You may have a hobby that could be a marketable commodity, or freelancing your skills could supplement your income.

Reach out to learn how you can put yourself in the best possible position to purchase a home.

‘Dear Seller’ Letters Offer Unique Negotiation Strategy

You’re probably familiar with letters to Santa. You’ve most likely heard of letters to the editor.

But have you heard of a homebuyer letter? In some areas, buyers are including these communications when they submit offers to purchase a home. If the trend grows, these messages could become common documents among real estate paperwork. Here’s the scoop.

What is a homebuyer letter?

These notes are designed to make a buyer’s offer more personal and appealing. The goal is to encourage the seller to choose the writer of the letter over another buyer.

In hot markets, a seller may receive multiple offers at once and must then choose which offer to negotiate or accept. To make their offer stand out, buyers are using these letters. They are written to sellers to plead the buyer’s case, offering reasons the seller should accept this offer over others.

What is included in the letter?

The exact details vary from letter to letter, but many contain similar details. Buyers often mention the features of the home that they love, discuss how they plan to use the house, or reassure the sellers that they don’t plan to make significant changes to the home. This can prove helpful in situations where the seller has lived in the home a long time or the property has been in the family for generations. Buyers may also include personal information such as hobbies and professions to try to further connect with the seller.

Does it work?

Apparently, it can. Real estate agents have reported instances when sellers did not choose the highest bid because of a letter included with a lower offer.

Of course, this tactic is not guaranteed to work. For many sellers, the price is all that matters. And to others, the letters can come across as corny or inappropriate.

Is this a good strategy to use for your next offer? Should you polish up your writing skills and submit a homebuyer letter? Maybe.

Consult with your real estate agent to determine what’s best for your situation.

Home Seller’s Guide: Top Do’s & Don’ts for a Quick Sale

You want to sell your home quickly and for the best possible price, right? What’s the secret to achieving this goal? There are several. Use these do’s and don’ts to guide your home sale process.

What to Do

Get out of Dodge: When potential buyers view your home, they want to see your property, not you. Always leave the premises. The buyers will feel more comfortable and are likely to spend more time looking at your home and fully considering it if you are not there.

Put out the welcome mat: Go the extra mile to make your home show well. Declutter. Clean. Turn on all lights and open all window treatments before showings to create a bright, airy atmosphere.

Partner with a pro: A real estate agent knows what works best in your market. He or she can provide invaluable input to make your home stand out among the competition.

What Not to Do

Take it personally: A home filled with personalized décor can turn buyers off. Neutralize your home to make it appealing to the maximum number of buyers. This might mean removing family photos or repainting your bright orange bathroom.

Crowd the skeletons: When you declutter your home, don’t simply throw everything in the closets. Your storage spaces need to look large, useful, and inviting.

Overinflate: While you want to get the biggest bang for your buck, overpricing your home only delays your sale. Consult with a real estate agent who can help you determine the right price for your home based on features, location, and current market trends.

Increase Property Value by Avoiding These Landscape Blunders

Everyone knows the importance of making a good first impression. It’s no different when it comes to your home’s curb appeal, which refers to your property’s overall appearance from the street.

To make your home’s “frosting” as appealing as possible, you’ll definitely want to think about planting stunning blooms and making sure your landscaping is well manicured and maintained. Implementing a long-term landscaping plan can help increase your property value when it comes time to sell.

When you go to plant, make sure to avoid the below common landscaping mistakes that homeowners make when planting trees and shrubs.

First, avoid planting invasive tree species. Some such species, like bamboo, grow quickly and actually push out native plants, which does tremendous damage to an area’s biodiversity.

Another no-no is planting too much and too close together. When too many trees and plants are crammed together, the greenery doesn’t have enough space to grow bigger, stronger, or healthier. While aesthetically this could look good for the first few years, the plants will eventually mature and fight each other for light and nutrients. So, unless you want a property covered in dead leaves and branches, it’s best to save your coins and plant less.

When planting anything, you’ll want to make sure you’re not too close to home. This, professionals warn, is a nightmare in the making. Trees planted too close to the home will, over time, get woody and grow too close, which will bring bugs and moisture inside. The resulting dampness could actually lead to rot inside your house, and the tree’s big roots could damage your property’s foundation or basement.

When it comes to planting and maintaining your home’s green exterior, do your research and exercise restraint. While trees and shrubs certainly boost your home’s value and curb appeal, some green mistakes could cost you.

Will Balance Return to Real Estate Markets?

According to the Canadian Real Estate Association (CREA), the summer of 2017 delivered the first year-over-year decline in home prices in four years. And this may be a sign of balance returning to housing markets across Canada.

As reported by CREA, the across-the-country decline was only 0.3 per cent, but many believe this downward trend will continue at least into the new year. According to CREA, home sales declined in two-thirds of the Canadian market, including Calgary, Halifax and Ottawa, and the Greater Toronto Area.

As CREA chief economist Gregory Klump says: “Sales may be starting to bottom out amid stabilizing housing market sentiment. Time will tell whether that’s indeed the case…”

The national news magazine Maclean’s believes that prices will also fall, especially in the single, detached-home market. And, to the relief of many, Maclean’s suggests the days of bidding wars are most likely behind us.

Market watchers attributed the drop in home sales that initially affected Vancouver, and was still impacting Toronto this fall, to recent measures imposed by both provinces designed to cool overheated housing markets.

Also this fall, the Bank of Canada increased the interest rate for the second time in two months – which had the immediate effect of raising mortgage rates. Expectations are that rates will continue to rise. As well, the Office of the Superintendent of Financial Institutions is considering again tightening credit regulations. But industry pushback may put this on hold.

What are buyers and sellers across the country to do? With the usual slowdown in the housing market in fall and winter combined with uncertainty on many fronts, both may be inclined to take a wait-and-see attitude.

Or they may adopt the position of cautious optimism espoused by some experts, who are anticipating calmer, more balanced housing markets across the country with more choice for buyers and sufficient profit for sellers.

After all the instability, this may be news to take action on.

Downsizing Happens at All Ages Now: Here’s How to Ace It

Downsizing is often associated with empty nesters and retirees, but as it turns out, more and more homeowners of all ages-including millennials-are looking for smaller residential footprints.

Currently, more than 40 per cent of Canadian millennials rent, and many say they prefer it. But those who are buying are lining up for small condos that will allow them to live in urban centres at affordable prices.

Downsizing dilemmas

Getting rid of belongings that won’t fit in your smaller space is challenging. The upside-of particular interest to millennials-is the opportunity to dump old inherited pieces for trendy modern furniture.

Measure your new home before moving day, and decide what to take before you start packing. If there’s a too-big item that you can’t bear to part with, store it. But not at mom and dad’s, say experts; they may be downsizing soon themselves.

Emotional attachment can make it hard to decide what you should throw out. Ask a straight-talking friend or family member to help with an unbiased second opinion on tough decisions-like whether your bookcase or king-sized bed is way too big for your new digs.

Once you’ve rounded up everything you won’t be taking, have a garage sale. You’ll feel less guilty about parting with so much, and you can make a surprising amount of money to help with moving expenses.

Trying to dispose of all the items you can’t sell can be overwhelming. Hiring a pickup service for junk removal or to take to a charity can be well worth the expense.

Second Mortgages: Make Your Dreams Happen – Carefully

RateHub defines a second mortgage as “an additional loan taken out on a property that is already mortgaged.” Sounds risky – and indeed it comes with plenty of risks. But it also comes with rewards.

There are two major kinds of second mortgages: The home equity line of credit (HELOC) has a variable interest rate and acts much like a credit card, allowing you to withdraw the cash you need, when you need it. And the fixed-rate home equity loan allows you to borrow a lump sum and make set monthly payments.

Second mortgages provide speedy access to money at a generally favourable interest rate – and the interest you pay on mortgages may also be tax deductible. Compared with money borrowed on a credit card or a standard consumer loan, a second mortgage may be easier to obtain, and you can use the money for whatever you want: home remodels, tuition – even a dream trip.

The most important disadvantage: because your home secures the loan, the second mortgage lender takes on less risk than with a personal loan, and may offer you more money than you need. Many borrowers are happy to comply, only to find themselves in trouble.

Ensure you can make your monthly mortgage payments easily, even when interest rates go up or personal circumstances change. And note that if interest rates increase, so will your monthly HELOC payments. Home equity loan payments aren’t affected by rate increases during the term of the loan.

So go ahead and make that bucket-list trip a reality – but plan carefully.

Second Mortgages: Make Your Dreams Happen – Carefully

RateHub defines a second mortgage as “an additional loan taken out on a property that is already mortgaged.” Sounds risky – and indeed it comes with plenty of risks. But it also comes with rewards.

There are two major kinds of second mortgages: The home equity line of credit (HELOC) has a variable interest rate and acts much like a credit card, allowing you to withdraw the cash you need, when you need it. And the fixed-rate home equity loan allows you to borrow a lump sum and make set monthly payments.

Second mortgages provide speedy access to money at a generally favourable interest rate – and the interest you pay on mortgages may also be tax deductible. Compared with money borrowed on a credit card or a standard consumer loan, a second mortgage may be easier to obtain, and you can use the money for whatever you want: home remodels, tuition – even a dream trip.

The most important disadvantage: because your home secures the loan, the second mortgage lender takes on less risk than with a personal loan, and may offer you more money than you need. Many borrowers are happy to comply, only to find themselves in trouble.

Ensure you can make your monthly mortgage payments easily, even when interest rates go up or personal circumstances change. And note that if interest rates increase, so will your monthly HELOC payments. Home equity loan payments aren’t affected by rate increases during the term of the loan.

So go ahead and make that bucket-list trip a reality – but plan carefully.

Doubtful New CMHC Insurance Rates Will Dampen Demand

Mortgage insurance may cost more, but that likely won’t have a major impact on demand.

On March 17, CMHC officially began charging homeowners a higher percentage of their mortgage’s value in order to insure it. The rates differ depending on the mortgage amount and the amount of equity the owner has in the property.

For many years, buyers who made down payments of less than 20 per cent of the purchase price of their home have been legally required to pay mortgage insurance. It’s a way to protect the mortgage lender in the event the homeowner defaults on the loan.

But CMHC says its third increase in mortgage insurance in a four-year period is not targeting new home buyers, many of whom are feeling the effects of other changes, including a stress test designed to ensure they can continue to pay their mortgages as rates rise and an increase in both mortgage rates and home prices in some markets.

In fact, few new buyers are likely to be discouraged by CMHC’s recent increase: it’s relatively small.

And those home buyers with smaller down payments will pay less than those with larger down payments (who are paying higher home prices).

According to a recent article in the Globe and Mail, a buyer with a 5% down payment on a $150,000 mortgage will pay an increase of approximately $2.82 more per month.

For a buyer with a 15% down payment on an $850,000 mortgage, premiums will increase by almost $40 more per month.

Canada’s Real Estate Market in 2017: How Is It Shaping Up?

Three months into 2017 it looks like predictions made in a study conducted by the Urban Land Institute and PwC are pretty much on track.

Canadians need no reminder of the crazy real estate ride of the past few years: Prices of homes skyrocketed, particular in Vancouver and Toronto; foreign investment surged; and governments tried to dampen housing demand with stress tests to ensure buyers could afford their homes should interest rates rise.

Lack of affordable housing: Housing prices were all over the map in 2016. (They ranged from +15.5% in Toronto to -2.8% in Saskatoon, with the Canadian average totalling a 10.6% change). The key issue was and is lack of affordable housing: All signs point to a continuation of this trend throughout 2017.

Slow sales: High prices, low inventory and new regulations are expected to dampen sales. We’re about to find out whether that will hold true in the spring months, which is traditionally a time for a boost in home sales.

Rentals – the new normal: It won’t happen overnight, but 2017 just could be the year of the rental home, especially in expensive urban centres. Thanks to expected high immigration over the next five years, as well as downsizing boomers and millennial urbanites, demand will grow for long-term rentals, once considered a short-term housing solution.

Challenges: There are challenges aplenty ahead in 2017 – both globally and domestically – that will impact Canada. Ultimately, our housing market will respond. However, in this first quarter of the year, how remains the question.

Will DIY Mortgages Take Off in Canada? Many Say ‘Yes’

Picture this: You get up, grab a coffee and your laptop, and… apply for a mortgage. Online.

Maybe in the U.S., you say. But in Canada?

It’s looking more likely. And the game changer may well be Quicken, whose Rocket Mortgage product was advertised during this year’s Super Bowl. According to one Rocket client, you get actual approval in minutes online, including verification of credit, income and assets. It shaves off an estimated seven days from the process.

Rocket Mortgage and its competition have been around for a while, but the publicity gleaned by Quicken has given a huge boost to the U.S. DIY mortgage industry.

Will it come to Canada? Robert McLister, whose intelliMortgage company offers some degree of automation to Canadian rate seekers, notes in a recent article for Canadian Mortgage Trends, “The short answer is yes, in some shape or form, but likely not for a few years, minimum.”

Already several Canadian lenders have online portals for mortgage seekers. Some are more advanced than others, but what’s lacking here is what dramatically changed the U.S. mortgage application process – e-signing.

There are federal regulations around e-signatures that may be slowing down the adoption of e-signing here. As McLister says, “Certain Canadian lenders have been painfully slow in allowing brokers to submit e-signatures.” Without this “revolution,” it may take a while for Canadians to be able to complete the whole process of acquiring a mortgage online. But given Rocket’s successful takeoff, we may not have to wait too long.

Steel ‘Bones’ May Change the Building Industry

New technological innovations occur in every industry and company. But construction?

It’s true: Quebec-based company BONE Structure has created pre-cut and premeasured “bones” of recycled, light-weight steel, which can be clicked together, like Lego or Meccano pieces, to frame residential and commercial buildings.

The result is a flexibility the building industry isn’t usually known for; designs allow for easy renovations such as removing a child’s bedroom when they leave home, then adding the room back in when extra space is needed. It’s suited to open-concept housing, and the method of framing builds in an almost unlimited number of windows – something those planning to build in a picturesque spot will appreciate.

Assembly can happen quickly; some plans require only five days to complete – although several weeks is more usual. The production process is environmentally friendly, and the company says that steel-bone framing is as strong as wood and costs only 5 percent more. Maintenance costs are also reduced.

According to a recent article in the Toronto Star, there are more than 200 homes in Quebec and the GTA made from the material, and more are planned. The steel “bones” are being used to construct everything from multi-unit residential buildings to a car wash. The company is also constructing a McDonald’s near Montreal, and recently built a Louisiana patio that can be taken down in storm season.

The steel-frame technology works well for retail companies, such as restaurants and stores; there is little noise or dust during construction, so they don’t have to close while work is underway.

Caledon, ON, homeowner Patrick Skuce, whose home was the first Bone Structure home built in the province, was quoted recently in the Huffington Post as saying: “These homes are different and fit any lifestyle…because no wood framing is used, there’s no chance for mold, mildew, or rot to set in. It’s virtually maintenance free.”

Walkability is All About Dollars and Sense

How much would you pay to be close to the amenities you need? Well, even as far back as 2009, people paid between $4,000 and $34,000 more for houses with above average walkability scores. Now it’s considered even more valuable.

Walkability is all about living within a comfortable walking distance from the amenities that are important to you: schools, parks, grocery stores, restaurants, etc. The highest walkability scores (90 to 100) mean you can complete all your daily errands on foot.

And this is a game-changer.

Today’s home buyers, particularly the younger ones, want to buy in urban areas where entertainment, work, school, and stores are walkable from home. Not just because these areas are trendy, but also because walking saves on long commutes, parking tickets, and gasoline. Plus, it’s healthy.

Walkability scores are the brainchild of a Seattle company called Walk Score, which compiles walkability data for virtually every address in North America. Walk Score sells this information to a number of real estate industry websites, and they, in turn, use the data in their listings to attract potential buyers to walkable properties. Houses listed with high walkability scores can command a premium, according to a 2009 Impresa study quoted in Real Estate News Exchange and noted above.

So what’s next? These days, the environmental and economic benefits of proximity to transit, and bicycle-friendly neighbourhoods, are as appealing as being able to walk to everything. So, Walk Score has introduced Transit and Bike Scores to its online searchable data base.

Don’t Lower Your Home’s Value With Quirky Renos

Home makeovers and updates are touted as a sure-fire way to increase curb appeal and boost your home’s value. But not all projects are created equal; some can actually lower the value of your home and make an eventual house sale more difficult.

While you can still follow your heart when planning quirky home renovations, you should do it for your own enjoyment. Here are some of the projects that can work against you:

  • Over-the-top renos: Certainly buy top-of-the-line everything for your kitchen or bathroom project, but if the finished product is too out of synch with neighbouring properties, don’t expect to recoup your investment when you sell.
  • Pools: Like a big garden, a pool requires work. Keeping it in good running order can be expensive. Prospective buyers may pass on a home with a pool for safety reasons.
  • Additions: Adding extra square footage to your home will likely mean increased property taxes and potentially higher utility bills. Keep that in mind when weighing cost and benefits. A DIY addition can also be problematic; only tackle a project of this nature with the help of professionals.

Also, your neighbours’ tumble-down fences, overgrown shrubs, and a front or backyard full of junk, can scare off potential buyers. Most municipalities have by-laws to encourage people to maintain their properties. If your neighbours won’t respond to suggestions – or offers to help clean up – contact your local government.

Will CMHC Continue Condo Ownership Research?

In the past, Canada Mortgage and Housing Corp. (CMHC) was the source of information on buying a house. It meant good home-buying tips, reliable statistics, and the comfortable feeling that our “government” housing expert wouldn’t send us down the wrong path. CMHC was also the place we went for mortgage loan insurance; many of us were able to buy our first home thanks to CMHC.

That was then; this is now. Now we’re more likely to go to one of thousands of websites for home-buying tips. And although it is still a major provider of mortgage loan insurance, CMHC shares that role with others.

Now CMHC is attempting to bring back its authoritative voice after a damning report from CIBC deputy chief economist Benjamin Tal suggesting that Canadians know zip about the state of our own housing market.

As CMHC’s CEO, Evan Siddall, told the Globe and Mail: “We’ve been a little bit internally focused; we’ve been a little bit confined about the information we’ve shared with people.” So CMHC will undertake housing market research where data gaps exist.

Its first effort was a survey designed to redress a lack of data on condo ownership, released this past summer. The issue has been a hot button in many urban areas, where the booming condo scene has raised concerns about offshore ownership in the market.

Interestingly, the CMHC survey failed to address this issue. The survey found that of 42,426 Vancouver and Toronto households who owned condos last August and September, 17.1 percent were owned by investors. But it didn’t establish how many of these were foreign-owned.

Using CMHC’s figures, Tal figured the total is 5 percent. However, others believe it could be much higher, at least in Toronto; T.O. condo specialist Brad Lamb estimated it could be as high as 50 percent.

Most analysts are hoping for more specific ownership information from CMHC.

Will Premium Increases Impact the Housing Market?

Effective May 1, mortgage insurance premiums have increased. The question is, how will this impact the Canadian real estate market?

The announcement at the end of February by Canada Mortgage and Housing Corporation (CMHC) had many real estate watchers buzzing, not so much because of the extra cost, which boils down to an increase of $5 a month on a typical mortgage payment, but about whether the move is a positive one.

The increase doesn’t affect current homeowners, so the “who” is once again first-time home buyers. It’s a lucky new buyer who can put down the 20 percent down payment now required to skirt around mortgage default insurance; most first-timers will still have to buy mortgage insurance, either from CMHC or from its two competitors, Genworth Canada and Canada Guaranty, who have followed suit.

The government-owned CMHC is the country’s national housing agency and reports to Parliament. The changes it makes often signal the government’s intentions, and some believe the most recent change is only the latest in a string of signals from Ottawa that the Canadian housing market is over-heated. The concern is that a greater proportion of household income is now being spent on housing, and that rate increases (when, not if, they come) might put some homeowners at risk of defaulting on their mortgages.

CMHC officials deny the move is a government signal, and most observers believe the move was made by the corporation for business reasons, and that it’s a good one. The consensus is that the small increase won’t significantly affect the housing market, although one bank official did express concern that the increase will be rolled into monthly mortgage payments and further increase household debt.

Although first-time buyers, in particular, won’t like the increase (and may have bought earlier this spring to beat the deadline), it may prove to be much ado about nothing in the future.

The Second Time Around Poses Challenges, Too

Second-time home buyers certainly know a thing or two about the purchase experience. But while the first trip round the real estate block was a learning experience, the second outing brings about a whole new set of challenges.

To begin with, next-time buyers have to juggle both selling and buying. Previously, only home buyers with nerves of steel would risk carrying two mortgages for a period of time; however, in sellers’ markets such as Toronto and Vancouver, you might consider it. But make your offer conditional on selling your home, if possible.

In a recent Toronto Star article, Kristin Kent notes: “Whether you buy first or sell first boils down to your needs and your financial status.” You’ll face the same costs as last time: Legal and agent’s fees, closing costs, home inspection charges, and moving expenses.

However, this time around you won’t be able to borrow from your RRSP for the down payment through Home Buyers Plan, and you can’t expect a rebate for the land transfer tax paid.

On the positive side, you may avoid buying mortgage insurance by using your equity to put down the 20 percent required.

There are also expenses in preparing your home for sale. Discuss the condition of your property with your real estate agent. In a hot market, you may decide to sell “as is,” but in most areas of the country, you’ll want to make your property shine.

Before you make the decision to list and/or start looking, a chat with your lender is in order. Can you get a bridge loan to buy a new property before you sell?

And can you take your mortgage with you? You may find it’s possible to “port” your mortgage to your new property, but you’ll only want to do so if the current rate and the time left on the mortgage are in your favour.

Your Home’s Not Just Your Castle: It’s a Money Maker

Ah, the retirement lifestyle – worry-free, toes in the sand, and visits with the grandkids. It sounds too good to be true, and for some, it is. But if you’re prepared to borrow and spend money and sacrifice some privacy, your home can be a source of retirement income. Not just your castle.

When the real estate market experiences a significant boom, like Canada’s housing market has in recent years, your home becomes a money-maker. And even (and maybe especially) house-poor homeowners can take advantage.

Anyone who has ever watched HGTV Canada’s Income Property knows the premise: You invest in a property, renovate all or part of it, and become a landlord. You’ll lower your mortgage costs and be able to save for retirement – or to invest in another income property.

If you own a high-maintenance home in a good neighbourhood and want to downsize, take advantage of low inventory levels in centres such as Toronto and Vancouver, and benefit from the appreciation in your home over the past few years. Particularly for owners of scarce detached or semi-detached properties in urban areas, your home may be worth more than you’d imagine.

The equity in your home can also provide a back-up plan if your savings account runs low. You may be able to borrow against the equity you’ve built up with a reverse mortgage or home equity line of credit.

These also provide a way to finance a grandchild’s education, renovate your home, or enjoy that retirement lifestyle…and fulfill those dreams.

Canadians Give Housing Market the Thumbs-Up

Warnings about a housing market on the verge of a U.S.-style meltdown may sell newspapers, but if consumer confidence is any indication, the Canadian housing market is just fine.

According to the 2013 Annual State of the Residential Mortgage Market in Canada report by the Canadian Association of Accredited Mortgage Professionals (CAAMP), mortgage-holders felt comfortable with their mortgage debt last year, seeing it as “good” versus “bad” debt.

“Consumer confidence in the mortgage market remains high, especially among people who have owned homes for a longer period,” said Jim Murphy, president and CEO of CAAMP, in a release on the report. “Consumers are paying off their mortgages faster, selecting five-year, fixed-term rates, and agreeing that real estate is a good long-term investment.”

Consumer confidence is so strong, in fact, that fewer than 10 percent of Canadians expect a housing bubble burst.

In one aspect of the report, survey participants were asked to predict changes in housing values over the next five years. While many experts expect rocky times, more than half of the consumers surveyed anticipate a fairly stable environment, with prices that are flat or increase slightly. Only a small group of respondents felt that prices would increase rapidly.

Provincial differences

Of course, the resale housing market in 2013 differed across Canada: Nationally, sales were down by 5 percent, and only three provinces beat the 5 percent level – Alberta, with an 11.3 percent increase, New Brunswick, which dropped by 2.3 percent, and Manitoba, which experienced a 3.3 percent decline.

What’s also interesting is that older Canadians are more likely to predict stability; younger people are more wary, expecting that a housing bubble burst is a possibility.

Still, wariness is not stopping property virgins from diving into the Canadian housing market. Last year, 57 percent of home purchases were made by first-time buyers. Those buyers join the ranks of the now 9.52 million homeowners in Canada.

Seniors Take On Debt to Help Their Kids Buy Homes

Retired Canadians are finally enjoying the fruits of their labours. Or are they? According to statistics, people over 65 are piling on debt just as other age groups are paying it down. And one contributing factor may be the number of seniors gifting or loaning down payments to their children.

A report by rating agency Equifax Canada Inc. noted that average consumer debt for the 65+ group increased by 6.5 percent in 2013, ahead of all other age groups.

In a Financial Post article, Nadim Abdo, vice-president of consulting and analytical services at Equifax, says: “I think what’s happening is people 65-plus are taking this on mostly to help their kids.”

Experts suggest it’s partly thanks to low interest rates; with home equity loans at record lows, seniors are taking advantage and their kids are benefitting.

It’s understandable, as Jim Yih points out in the Edmonton Journal: “With high real estate prices and tighter mortgage lending rules, it can be tough for first-time homebuyers to get into the market. Many new homebuyers look to parents for help, and many boomers and soon-to-be retirees are quick to help out by offering the down payment.”

Unfortunately, if parents need to tap their investment in an emergency, they can’t “just pull the money out of the home as they would with an investment like a mutual fund,” says the Parental Guide: Buying a Home for Your Child. So they go further into debt…and become statistics.

Likely not what their debt-conscious children had in mind.