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New system save brokers valuable time and effort as strengthen their relationships with their clients | TD


TD launches new, streamlined process for brokers

Ephraim Vecina
other

Submitting referrals for the bank’s protection plans is now more efficient

TD has announced a new process for brokers with an enhanced digital referral system for its TD Protection Plans products.
The new system will save brokers valuable time and effort, as well as “strengthen their relationships with their clients,” TD said.
“And how much time will they save? A considerable amount given the new rapid referral process can take only 60 seconds,” the bank said.
“Brokers simply refer their customers to TD and our specialists will take care of the rest to ensure customers are well informed about their TD Protection Plan options, which include TD’s popular Mortgage Protection Plans. These plans provide Canadians with peace of mind in the knowledge their mortgage can be reduced or paid off in the event of an unforeseen covered health event.”
Read more: TD announces Q2 results
Submitting an eligible customer can be done online through TD’s Protection Plan website or via the TD Mortgage Solutions portal.
“Fill out the customer’s information, read the disclosures to the customer, obtain their consent(s) and submit the form,” TD said. “Refer your customers to TD and our specialists will take care of the rest.”

Copyright © 1996-2022 Key Media, Inc.



Canada had a total reverse mortgage volume of $6B as of Q1 2022


Reverse mortgage boom could be on the way, report suggests

Fergal McAlinden
other

Strong growth potential also comes with heightened risk
The reverse mortgage market in Canada still lags behind those of other countries including Australia and the United Kingdom – but it has potential for “strong growth” in the coming years, according to a recent report.
Global credit rating agency DBRS Morningstar said in its latest commentary that Canada had a total reverse mortgage volume of under $6 billion as of 2022’s first quarter, with originations highly concentrated in metropolitan areas including the Greater Toronto Area (GTA) and Greater Vancouver Area (GVA).
Factors including Canada’s aging population and rapid home price appreciation in recent years mean the reverse mortgage market has ample room for growth, the report said, although it also highlighted the higher risk associated with those products because of “unique features” such as no defined term and no monthly repayment of principal and interest.
That means lending institutions that cater to reverse mortgages are likely to maintain “strict underwriting standards and conservative lending policies,” to ensure mitigation of those risks, according to DBRS Morningstar.
Property valuation and appraisals are especially crucial in determining the initial mortgage amount for a reverse mortgage, the report said, as well as for maintaining asset quality and capital buffers to absorb unanticipated losses, for instance during a downturn.
That’s because repayment risk heightens when the housing market slips, part of the reason that Canada’s banking regulator, the Office of the Superintendent of Financial Institutions (OSFI) has indicated that it expects reverse mortgages to be limited to a maximum loan-to-value (LTV) ratio of 65% or under.
Read next: New HELOC regulation – what do brokers need to know?
Ken Lindsay (pictured top), broker of record at the Hamilton-based Mortgage Financial Corp. and a reverse mortgage specialist, told Canadian Mortgage Professional that perceptions around the product appeared to be shifting in Canada, with many homeowners viewing it as a means of accessing equity while remaining in their long-term property.
“People are starting to understand what it is now,” he said. “I can say for the last 10 years, people have been saying, ‘But I have all this equity.’ Equity, at one time, was an extremely good word when I first got in the business. Now, it tends to be a bad word unless you’re talking about a reverse mortgage.
“Like I say, it’s an equity mortgage. If you don’t want to make payments, you don’t have to. If you want to make payments so that it doesn’t go into reverse, that’s an option as well.”
As with any mortgage product, Lindsay emphasized the importance of suitability and making sure that a customer is fully aware of the features of the option, what it entails and their obligations under the agreement.
Those so-called “lifetime loans,” the DBRS Morningstar report highlighted, have a bullet repayment that becomes due upon a trigger event, consisting of principal and accrued interest. That could be upon sale or transfer of the property, a period of time after the final remaining borrower moves into a long-term care facility or retirement residence, or some time after the last borrower passes away.
Read next: Analysis: Reverse mortgage borrowing trends persist
Interest rates are typically about 150-300 basis points higher than a home equity line of credit (HELOC) or conventional mortgage, with the borrower’s age “an important factor for underwriting and imposes longevity risk,” the report said.
The product is seeing increasing uptake among older Canadians, Lindsay said, because it can often represent a better option than a private mortgage. “It’s cheaper than private,” he said.
“It’s geared for someone that has irregular income, needs better cash flow, and maybe could be for term or long-term payment relief – and allows them to avoid moving in with kids or moving out to a nursing home. For those reasons, it’s very popular.”
DBRS Morningstar said that the fact that reverse mortgages usually had a relatively low LTV meant that lenders in that sphere had a buffer against collateral value risk.
The majority of Canada’s reverse mortgages being located in parts of Ontario and British Columbia that have seen spectacular price appreciation also has its benefits and pitfalls, the report suggested.
“This rapid spike in prices [over 50% in some areas since the COVID-19 pandemic began] makes recently originated reverse mortgages riskier in a severe real estate market downturn,” it said, “but provides increased protection for older vintages.”



Metro Vancouver home sales down again in July | REBGV


Home sales continue to slump in Metro Vancouver, Fraser Valley in July

Tiffany Crawford
The Vancouver Sun

 The Real Estate Board of Greater Vancouver says only 1,887 homes were sold in July, a 43.3 per cent decrease compared with the same month last year.

Metro Vancouver home sales were down again in July, according to the Real Estate Board of Greater Vancouver. Photo by Postmedia

Home sales continued to slump last month in Metro Vancouver, as potential buyers back off because of rising interest rates, according to the Real Estate Board of Greater Vancouver.

The board reported Wednesday that only 1,887 were sold in July, a 43.3 per cent decrease from the 3,326 homes sold in July 2021. That number also represents a 22.8 per cent drop from the 2,444 homes sold in June.

Last month’s sales were 35.2 per cent below the 10-year July sales average, according to the report.

The board chair, Daniel John, said homebuyers are exercising more caution because of rising interest rates and inflationary concerns.

“This allowed the selection of homes for sale to increase and prices to edge down in the region over the last three months,” he said in a statement Wednesday.

The total number of homes currently listed for sale on the MLS in Metro Vancouver is 10,288, which according to the report is a 4.4 per cent increase compared to July 2021 and a 1.3 per cent decrease compared to June.

“After two years of market conditions that favoured home sellers, homebuyers now have more selection to choose from and more time to make their decision,” said John, in the statement.

“In today’s changing housing market, both homebuyers and sellers should invest the time to understand what these changes mean for their personal circumstances.”

As for prices, they are still higher than last year at the same time, but down slightly from the month previous. The reports says the composite benchmark price for all residential properties in Metro Vancouver is currently $1,207,400, which is a 10.3 per cent increase over July 2021 and a 2.3 per cent decrease compared with June.

The benchmark price for a detached home in Metro Vancouver is $2,000,600. This represents an 11 per cent increase from last July but a 2.8 per cent decrease from June.

The cost of a condo fared similarly at $755,000 — an 11.4 per cent increase from July 2021 but a 1.5 per cent drop from the month before.

The benchmark cost of a townhome, meantime, was $1,096,500, a 15.8 per cent increase from last July and a 1.7 per cent decrease compared with June.

Areas covered by the Real Estate Board of Greater Vancouver include: Burnaby, Coquitlam, Maple Ridge, New Westminster, North Vancouver, Pitt Meadows, Port Coquitlam, Port Moody, Richmond, South Delta, Squamish, Sunshine Coast, Vancouver, West Vancouver, and Whistler.

Sales slump in Fraser Valley as well

Similarly, the Fraser Valley Real Estate Board said sales fell again in July, citing interest rate hikes and inflation as likely reasons.

Story continues below

There were 993 home sales processed during the month of July, down 22.5 per cent from a month earlier and a 50-per-cent drop over July 2021.

July new listings totalled 2,385, a 28-per-cent drop from June and a decrease of 1.9 per cent from July 2021.

Prices also dropped for a fourth consecutive month, though they remain much higher than a year ago. Detached homes sold for a benchmark price of $1.594 million, down 3.5 per cent from June and 10 per cent below a March peak.

But the residential property benchmark is up year over year by 18 per cent.

 

© 2022 Vancouver Sun



Residential sale values across Toronto having fallen by 3.3%


Economists highlight the Toronto housing market’s 2022-23 prospects

Ephraim Vecina
other

Some disturbing trends are already apparent, market observers warn

While demand will remain robust, the Toronto housing market should brace for considerable price declines in the near future, according to a recent Toronto Star poll of economists.

The price-drop trend is already apparent, with residential sale values across Toronto having fallen by 3.3% from their peak in March. The decreases were even worse in Ontario, with some cities posting declines of 10% to 15%, the Toronto Star reported.

The surveyed economists’ current consensus is of a decline of at least 10% in home prices. The average home price in Toronto is expected to settle at $1.03 million in 2023.

Canadian Imperial Bank of Commerce is anticipating a 15% decline by the end of 2022.

“When the Bank of Canada raises interest rates, it’s aiming to slow economic growth by taking a bite out of activity in the interest-sensitive parts of the economy, and housing is high on the list of sectors that are exposed to the impact of higher rates,” said Avery Shenfeld, senior economist at CIBC.

Read more: GTA residential rent surges

BMO even ventured so far as to project a 20% drop by the middle of next year. This will accompany a decline of 23% in sales activity, mainly due to deceleration in Ontario and British Columbia.

“Given the exceptional deterioration in affordability – first due to the rapid run-up in prices, then by the rapid rise in interest rates – as well as the sudden turn in sentiment around the market, it’s difficult to see anything other than a meaningful correction ahead for Canadian housing,” said Doug Porter, senior economist at BMO.

“Each city will have its own story, and may fare differently – driven both by how far it surged in recent years, and the outlook for the local economy – but it will be a challenging period for almost all major housing markets.”

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Victoria plans to build an 18-storey tower with 180 rental units of affordable housing


Victoria developer donates $15 million in land for social housing

Darron Kloster
Western Investor

‘Once-in-a-lifetime’ donation will help develop 180 affordable homes by 2027

 Developers behind plans for a large mixed-used community on the Roundhouse lands in Greater Victoria, B.C., have donated a $15-million site in Vic West to the Greater Victoria Housing Society, which plans to build an 18-storey tower with 180 rental units of affordable housing.

The land on the southeast corner of Esquimalt Road and Catherine Street is part of ­Bayview Place’s master plan for eight other residential towers ranging from 18 to 28 storeys and the commercial Roundhouse development on the 10 remaining acres of the former E&N Railway lands.

James Munro, director of real estate for the Greater Victoria Housing Society, said the donation by Bayview Place owners Ken and Patricia Mariash is the largest the group has ever seen and could be a record for the Island and even the province for an affordable-housing project.

“It’s very significant and it’s a perfect spot for families and individuals on a bus stop, transportation corridors into downtown, across from a major park and close to two other properties the society operates,” said Munro.

Previously, Bayview had been trying to blend affordable housing with its other planned towers on the site. The idea of donating the corner lot arose after discussions with mayor and council and community groups, Ken Mariash said.

“Many of the city hall applications are an argument about how much and this and that,” he said. “We didn’t want to be trying to negotiate less than what should happen, so we thought we’d make it large.”

Munro said the society hopes to get the project before Victoria council before the Oct. 15 civic elections and to a public ­hearing before the end of the year. That way, detailed designs of the building can get underway, with a plan to start construction in 2024, with occupancy by 2027.

Munro said quick approvals from council are essential to the viability of the 18-storey tower, pointing to rising construction costs and interest rates.

“If the project is not approved soon, the project may not be able to proceed and these 180 new affordable homes will not be developed in the near term,” the housing society said in a statement.

The estimated capital cost for the development is $72 million, with construction costs estimated at $52 million.

The housing mix is expected to include studios, one-, two- and three-bedroom units and possibly six to 12 three-bedroom townhomes for families. An outdoor play and seating area will be included and there are plans for 80 parking stalls and 180 spaces for bicycles.

Munro said the development will attract a range of incomes from “working professionals to working poor” or those making $30,000 to $120,000 a year.

All of the units will have below-market rental rates and 30% of those will be at 80 per cent of the median market rate set by the Canada Mortgage and Housing Corp. — from $775 a month for a studio and $895 for one-bedrooms to $1,500 for three-bedrooms (in 2027 dollars), said Munro.

The remaining 70 per cent of the units will rent in the $1,300 to $2,950 range, also in 2027 dollars.

The Greater Victoria Housing Society currently has 17 buildings in the region, housing about 1,000 people, and the latest project is much needed.

“Land is the No. 1 constraint to develop new affordable housing,” said Virginia Holden, executive director of the Greater Victoria Housing Society. “This once-in-a-lifetime land donation will provide a significant project that will build a strong community in Vic West.”

 

© 2022 Western Investor



The 5 most affordable place to live in B.C. in 2022


Five B.C. towns where you can buy a home for $500,000

Shawn Conner
The Vancouver Sun

Here are five contenders based on supply, variety and a price tag hovering around $500k.

 The City of Nanaimo is situated on the east coast of Vancouver Island, the namesake of the famous dessert bar and birthplace of Diana Krall. Photo by Courtesy of City of Nanaimo /PNG

A buyer’s market may be emerging in the Lower Mainland but, for many, housing prices remain out of reach.

Rising interest rates will likely mean fewer buyers and a slowdown in average price increases. A general downward trend in home sales volumes and average price increases across the province is expected. Still, the average price of a home likely won’t be dipping much below $1 million any time soon.

So what’s a prospective buyer to do? Well, they don’t mind looking outside of the Lower Mainland and into some other corners of the province, relatively reasonably priced homes can still be found. Drawing on a 2022 Moving Waldo survey and a 2021 Zolo analysis of the most affordable places to live in B.C., we narrowed down the contenders to five based on supply, variety, and a price tag hovering around $500k. (Prices in effect as of Aug. 2.)

“While cities and towns outside of the Lower Mainland had seen significant upward pressure on pricing during the pandemic, there are still places in B.C. where $500,000 goes a pretty long way,” realtor Mary Cleaver of the Mary Cleaver Group said.

“With recent interest rate hikes, homes in many of these areas have begun to see home prices decline. I suspect further moves by the Bank of Canada could lead to more affordability in secondary markets in the coming months.” 

 

Vernon consistently places on most-affordable lists. Photo by Courtesy City of Vernon /PNG

1. Vernon

It may be the commercial hub of the North Okanagan, but Vernon consistently places on most-affordable lists. However, many of the houses available in the $500k range are on leased land. Most, if not all, product for that price or less, and on non-leased land, are townhomes, like a two-bedroom, two-bathroom 1,190-square-foot residence priced at $499,900.

 

2. Prince George

This sunny northern B.C. town of 74,000 is a haven for outdoor enthusiasts and financially strapped homebuyers. Half-a-million can still purchase a house with three, four, five or even six bedrooms, and there’s a fair amount on the market. We like a split-level three-bedroom home with a big backyard and a flex space currently set up as a martial arts dojo. It’s going for $485,000 but, as the listing says, “At this price point, this home won’t last long!”

3. Nanaimo

Situated on the east coast of Vancouver Island, the namesake of the famous dessert bar and birthplace of Diana Krall has mostly condos and townhomes for half-a-million dollars and under. A $489,000 two-bedroom, two-bathroom 994-square-foot townhouse in the Pleasant Valley neighbourhood is near amenities and opens onto a landscaped backyard. A two-bedroom, two-bathroom, 1,091-square-foot condo near Long Lake is listed at $499,900. Also available: a two-bedroom, one-bathroom, 884-square-foot house near downtown, with nine-foot-high ceilings, a claw-foot tub, and a small view of the ocean from the deck. Built in 1914, it’s definitely a fixer-upper.

 

4. Penticton

The sky’s the limit for half-a-million loonies in this South Okanagan town—if a buyer is in the market for a townhouse or condo. A three-bedroom, two-bathroom, 1,500-square-foot townhouse with a view of Penticton Creek is priced at $495,000, and a two-bedroom, two-bathroom 1,085-square-foot condo located alongside the same creek is going for $4k more. A three-bed, two-bath home in a townhouse complex priced at $499,900 shares an outdoor pool with other units. The bonus of living in Penticton is, of course, access to the mountains, parks, and lakes that make the area a favourite of golfers, hikers, boaters, and skiers.

 

5. Nelson

The West Kootenay city of 11,000 boasts a thriving cultural scene, a brewery, and close proximity to the Whitewater Ski Resort and other outdoor activities. Buying-wise, Nelson’s housing product for $500k or less includes houses, townhomes, and duplexes. A three-bed, two-bath 1,230-square-foot heritage home priced at $484,888 features a deck and is close to a picturesque downtown of heritage buildings.

 

© 2022 Vancouver Sun