As you most likely know by now BofC has held its key overnight rate at 1%. Listening to the words of explanation on this hold it would seem that the bank is hinting at no changes to come in the foreseeable future possibly up to one year. This, of course, is based on the economic indicators now in play (slow if any growth). At the very least we feel we will be at this rate for a least 6 months. Of course keep in mind the chartered banks do not have to follow suit but there have been no rumblings yet that they will make changes. Fixed rates for the chartered banks have also been inching down. In regards to the variable mortgage market we can only wait to see if the lending institutions will maintain the discount spreads off their prime rate, decrease them or even give further discounts as some already have.
Mark Carney must feel like a parent trying to instill wise spending habits in a carefree kid heading off to university: all he can do is give his best advice and hope it sinks in.
That’s a rough approximation of the tricky position the Bank of Canada governor finds himself in as he prepares to release his latest interest-rate decision on Tuesday.
Comment: Holding rates will stimulate the housing industry both resale and new construction
“Success means doing the best we can with what we have. Success is the doing, not the getting; in the trying, not the triumph. Success is a personal standard, reaching for the highest that is in us, becoming all that we can be.” (Zig Ziglar)
“Success is peace of mind, which is a direct result of self-satisfaction in knowing you did your best to become the best that you are capable of becoming.”
A must read by Jeff Rubin. Though I have not completed reading this business book by Jeff Rubin it is so compelling I just have to inform you. If you seriously wish to know why your life will alter over the next few years, in the choices you make, where you live, how you live, take a look at this. Not an alarmist missive but something that makes you sit up and ponder.
This month’s RBC Financial Markets Monthly publication reports that the Bank of Canada is likely to hold rates until March 2011.
Inflation remains mild with both the headline and core rates below the Bank’s 2% target. The uncertain global outlook is likely to be the dominant factor in the Bank shifting to the sidelines for the remainder of 2010.
This month’s RBC Financial Markets Monthly publication reports that the Bank of Canada is likely to hold rates until March 2010.
Inflation remains mild with both the headline and core rates below the Bank’s 2% target. The uncertain global outlook is likely to be the dominant factor in the Bank shifting to the sidelines for the remainder of 2010.
The practice of people selling their homes by themselves in Canada without a realtor’s help is still the exception rather than the rule. But Power Corp. of Canada is making a big bet that more Canadians will embrace the idea, launching a nationally branded service to help them do it.
Through its Quebec-based subsidiary Bytheowner.com (Duproprio.com in Quebec), which it owns by way of holding company Square Victoria Digital Properties, Power Corp. has bought four smaller no-commission companies in Alberta, Saskatchewan, Manitoba and Ontario for an undisclosed amount. The company now lists 12,000 properties for sale across Canada. With this move the diversified management company, with a market cap of more than $12-billion and interests in businesses such as Great-West Lifeco Inc. and Investors Group Inc., joins Rogers Communications Inc. and its online real estate search engine, Zoocasa, as major conglomerates taking a chance on consumers moving away from the traditional realtor model.“[Power Corp.] shares the same vision we do that the real estate marketplace will be very different in the next few years,” said Martin Rygiel, general manager of Bytheowner. Craig Fehr, an analyst with Edward Jones, said Bytheowner should be thought of as a minor advertising company in Power Corp.’s portfolio. “On a subsidiary level, this [expansion] just made sense from a diversification perspective,” Mr. Fehr said. “It offers another little bit of exposure to the online space. But I would never envision it becoming a material portion of Power’s overall earnings,” Mr. Fehr added.
The for-sale-by-owner (FSBO) concept takes out the real estate agent, allowing a consumer to save as much as 5% to 6% in commissions by listing their home online and then selling it independently.
The downside is a consumer loses access to the vaunted Multiple Listing Service, an online home listing controlled by the Canadian Real Estate Association. Only licensed realtors can post on MLS, which is a problem for alternative services as the service dominates the market to such an extent it has been under the investigation of the Competition Bureau. Most FSBO websites lack size and brand-name awareness as a result, but a nationally branded company with a billion-dollar backer may have enough presence to become a threat.
“The key here is scale,” Phil Soper, chief executive with Royal LePage, said in an interview. “The strategic rationale here is to desperately amalgamate costs to make it a going concern.”
However, Mr. Soper does not see Bytheowner and other such sites as a threat to established realtors.
“They are competing with the free services, such as Kijiji or Craigslist for that small sector of the market, about 10% to 15%, that chooses that path,” he said. “Most Canadians, despite the existence of these models for the last 15 years, have turned to a professional realtor.” And while there is some value in having a nationally recognized brand name, it is not necessarily a deal breaker, he said.
“The fact we’re a national company means very little to someone buying a home in Oakville. They could care less there’s an affiliated do-it-yourself website in Winnipeg,” he said. “Or you have a professional sitting in your kitchen who knows the neighbourhood.”
Power Corp. and Bytheowner have also ran into some legal problems recently.
The Organisme d’autoregulation du courtage immobilier du Québec, the province’s trade body overseeing real estate brokerage, has sued Bytheowner (DuProprio in Quebec) alleging the do-it-yourself website “acted in a manner that led [others] to believe that it was authorized to carry out the work of a real estate agent” without a real estate agent license. The suit alleges Bytheowner took out the misleading ads in Quebec City’s Le Soleil newspaper and also advertised using street billboards that read: “You’ll be richer.” The case is expected to be heard in Quebec Court next February.
Dominique Racine, spokeswoman for the brokerage association, declined to comment Tuesday. Nicolas Racine, the Fraser Milner Casgrain lawyer representing Bytheowner, did not respond to an email asking for comment.
Read more: http://www.financialpost.com/news/Power+Corp+betting+realtor+alternative/3593111/story.html#ixzz10uvcqtAd
Not surprisingly, the Canadian recovery didn’t play out as advertised. While we did see a spike late last year and early 2010, the momentum has faded lately, largely as a result of a strong C$ and a softening US economy. Growth in the second half of the year will be only a fraction of the Bank of Canada’s July Monetary Policy Report forecast. Early 2011 doesn’t look promising either, which should prompt major revisions in October’s MPR, forcing the Bank of Canada to defer further tightening. Recap of Benjamin Tal and Krishen Rangasamy weekly insight.
By Appraisal Institute of Canada (http://www.styleathome.com)
Thinking of someday selling your home? Check out these home improvements and the corresponding rate of return on the amounts invested.
To renovate your home and increase its market value in anticipation of selling it one day, here are several types of improvements and the corresponding rate of return on the amounts invested.
Highest return
* Bathroom upgrade: 75 percent to 100 percent
* Kitchen upgrade: 75 percent to 100 percent
* Interior or exterior painting: 50 percent to 100 percent
Medium-level return
* Roof replacement: 50 percent to 80 percent
* Replacement of furnace or heating system: 50 percent to 80 percent
* Finished basement: 50 percent to 75 percent
* Addition of family room: 50 percent to 75 percent
* Fireplace: 50 percent to 75 percent
* Installation of hardwood floor: 50 percent to 75 percent
* Construction of a garage: 50 percent to 75 percent
* Doors and windows: 50 percent to 75 percent
* Deck: 50 percent to 75 percent
* Central air conditioning: 25 percent to 75 percent
Low return
* Landscaping: 25 percent to 50 percent
* Interlocking paving stones on driveway: 25 percent to 50 percent
* Asphalt driveway: 20 percent to 50 percent
* Fence: 25 percent to 50 percent
* Pool: 10 percent to 40 percent
* Skylights: 0 percent to 25 percent
