Real Estate Nova Scotia and the Credit Crunch
Jul 28th 2008, 1:24 pm
#17
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Jul 28th 2008, 1:40 pm
#18
RETIRED Realtor
Joined: Aug 2006
Location: Winnipeg, Manitoba
Posts: 2,087
Re: Real Estate Nova Scotia and the Credit Crunch
It was this ratio that was silly, not the 100% mortgage.
Jul 28th 2008, 2:56 pm
#19
no I aint
Joined: Mar 2008
Location: The dog house
Posts: 2,100
Re: Real Estate Nova Scotia and the Credit Crunch
Up to a couple of months ago you could get a 125% mortgage
Jul 28th 2008, 6:04 pm
#20
Immigration Consultant
Joined: Jun 2007
Location: Halifax, Nova Scotia
Posts: 2,144
Re: Real Estate Nova Scotia and the Credit Crunch
The South Shore of NS which runs from the St. Margaret's Bay area west to Liverpool was an area first settled in the mid 1700's by South Germans and New Englanders. These people built very fine towns and villages and because of that there is a large stock of homes from that era. Most have been renovated and brought up to modern standards. Unfortunately the cost of renovating old homes quite often excedes the cost of building new ones and as a consequence they sit on the market for years because they are over priced compared with modern houses which can be purchased a 15 minute drive away. Many, many people before you- Hortons to go, have had the same idea. In the case of Lunenburg, most of the old houses sit on 30' x 60'
lots (standard town lot in 1753 when the town was founded) which means no privacy, no driveway, and the place is crawling with tourists, so it's like living in a fish bowl.
In the mid 90's the deep sea fishing went down and took it's ancillary industries with it. (ship building, foundries, etc.,) The people who worked
in those industries all moved away leaving a rump population of the retired,
the near dead, artists, and my favorite - "consultants". Consultant is the code word for (unemployed but inherited enough to live on) in Nova Scotia.
A lot of middle aged guys there have beards and wear Greek fishermans caps. That's how you can tell.
Lunenburg is about 80 km's west of Halifax but high gasoline prices have taken the shine off of commuting. There is no public transportation and few places to work in the immediate area outside of health care.... geriatrics anyone. Nearby Mahone Bay and several other communities are in the same boat.
Most importantly - the place has lost it's spirit. The primary school will not re-open this fall. What few children that remain will be bused to Bridgewater. The people who made it go were the descendants of those who founded it and were a bunch of cranky, arrogant old Bluenoses but they made it a community and they were fun to drink with. They've all moved away or died.
That's why there are so many houses for sale on the South Shore. Nothing at all to do with that sub prime business. Just plain old over speculation in a market that isn't growing.
lots (standard town lot in 1753 when the town was founded) which means no privacy, no driveway, and the place is crawling with tourists, so it's like living in a fish bowl.
In the mid 90's the deep sea fishing went down and took it's ancillary industries with it. (ship building, foundries, etc.,) The people who worked
in those industries all moved away leaving a rump population of the retired,
the near dead, artists, and my favorite - "consultants". Consultant is the code word for (unemployed but inherited enough to live on) in Nova Scotia.
A lot of middle aged guys there have beards and wear Greek fishermans caps. That's how you can tell.
Lunenburg is about 80 km's west of Halifax but high gasoline prices have taken the shine off of commuting. There is no public transportation and few places to work in the immediate area outside of health care.... geriatrics anyone. Nearby Mahone Bay and several other communities are in the same boat.
Most importantly - the place has lost it's spirit. The primary school will not re-open this fall. What few children that remain will be bused to Bridgewater. The people who made it go were the descendants of those who founded it and were a bunch of cranky, arrogant old Bluenoses but they made it a community and they were fun to drink with. They've all moved away or died.
That's why there are so many houses for sale on the South Shore. Nothing at all to do with that sub prime business. Just plain old over speculation in a market that isn't growing.
In addition, the thing I find with the south shore is that people (especially those with waterfront) put their houses on the market at crazy prices and leave them on the market forever. They dont really want to move, they just hope to get lucky one day and achieve a crazy price for their house. It does happen but very not often - occassionally someone from the US or UK will come along and pay $1million for their "dream home" that locals wouldnt be willing to pay more than $300k for. And the owners get rich.
Jul 29th 2008, 1:15 am
#21
Forum Regular
Joined: Jan 2008
Location: Halifax. Nova Scotia
Posts: 177
Re: Real Estate Nova Scotia and the Credit Crunch
Thought you would find this interesting reading ...
ORI MCLEOD
From Friday's Globe and Mail
July 10, 2008 at 10:01 PM EDT
The real estate industry is bracing for a surge in home purchases, betting buyers will rush to get ahead of tighter federal government standards for the mortgage industry.
The Finance Department will stop guaranteeing 40-year and zero-down-payment mortgage loans starting Oct. 15.
That has set off speculation that a surge of buyers, particularly those in pricier regions who have little money saved, could try to push into the market before the new rules take effect.
“Anybody who doesn't have 5-per-cent down likely will be trying to get into the market,” said Gary Siegle, regional leader at mortgage broker Invis Inc.'s Calgary office. In markets where prices have soared, such as Calgary and Toronto, first-time buyers need the longer amortization to bring monthly payments down to a point they can afford, he added.
Home buying activity is expected to rise sharply leading up to the Oct. 15 deadline, then taper off again when mortgages become more difficult to obtain, said Sébastien Lavoie, a former economist at the Bank of Canada who now works at Laurentian Bank in Montreal.
“I am very sure there will be a rush of buyers and brokers and lenders rushing to get in before the deadline,” said John Panagakos, owner of Toronto brokerage The Mortgage Centre.
The Federal government said it was making the changes to its mortgage guarantees to strengthen the real estate market, and to help guard against a U.S.-style housing bubble.
Canada's housing market has already cooled, leading some critics to say the government moved too late. However, the changes are also likely a pre-emptive effort to mitigate the risk of the federal government's exposure to the mortgage market, said Jim Murphy, president of the Canadian Association of Accredited Mortgage Professionals.
Mortgage insurance was introduced in 1954 through the Canada Mortgage and Housing Corp. (CMHC) to help Canadians who hadn't saved up enough money to qualify for traditional mortgage loans from the banks.
Currently, buyers with less than a 20-per-cent down payment pay a premium for the insurance, which protects the lender in case of default. For example, someone with a $300,000, 40-year amortization mortgage and a 5-per-cent down payment will pay $10,050 for insurance.
Three competitors of CMHC have now entered the mortgage insurance market, Genworth Financial Canada, AIG United Guaranty Canada and The PMI Group, Inc. Canada.
The government guarantees 100 per cent of CMHC-insured loans, and 90 per cent of those in the private sector.
“I think the government is sending us a clear signal that there are boundaries it intends to enforce,” said David Liu, vice-president and head of operations at PMI Canada.
PMI is still trying to figure out what the move means for its business, including deciding whether it will continue to provide insurance for 40-year and no-money-down mortgages without the government guarantee, he said.
While such a move has risks, it could give private insurers an edge over the CMHC.
With files from Kevin Carmichael
JS Halifax
ORI MCLEOD
From Friday's Globe and Mail
July 10, 2008 at 10:01 PM EDT
The real estate industry is bracing for a surge in home purchases, betting buyers will rush to get ahead of tighter federal government standards for the mortgage industry.
The Finance Department will stop guaranteeing 40-year and zero-down-payment mortgage loans starting Oct. 15.
That has set off speculation that a surge of buyers, particularly those in pricier regions who have little money saved, could try to push into the market before the new rules take effect.
“Anybody who doesn't have 5-per-cent down likely will be trying to get into the market,” said Gary Siegle, regional leader at mortgage broker Invis Inc.'s Calgary office. In markets where prices have soared, such as Calgary and Toronto, first-time buyers need the longer amortization to bring monthly payments down to a point they can afford, he added.
Home buying activity is expected to rise sharply leading up to the Oct. 15 deadline, then taper off again when mortgages become more difficult to obtain, said Sébastien Lavoie, a former economist at the Bank of Canada who now works at Laurentian Bank in Montreal.
“I am very sure there will be a rush of buyers and brokers and lenders rushing to get in before the deadline,” said John Panagakos, owner of Toronto brokerage The Mortgage Centre.
The Federal government said it was making the changes to its mortgage guarantees to strengthen the real estate market, and to help guard against a U.S.-style housing bubble.
Canada's housing market has already cooled, leading some critics to say the government moved too late. However, the changes are also likely a pre-emptive effort to mitigate the risk of the federal government's exposure to the mortgage market, said Jim Murphy, president of the Canadian Association of Accredited Mortgage Professionals.
Mortgage insurance was introduced in 1954 through the Canada Mortgage and Housing Corp. (CMHC) to help Canadians who hadn't saved up enough money to qualify for traditional mortgage loans from the banks.
Currently, buyers with less than a 20-per-cent down payment pay a premium for the insurance, which protects the lender in case of default. For example, someone with a $300,000, 40-year amortization mortgage and a 5-per-cent down payment will pay $10,050 for insurance.
Three competitors of CMHC have now entered the mortgage insurance market, Genworth Financial Canada, AIG United Guaranty Canada and The PMI Group, Inc. Canada.
The government guarantees 100 per cent of CMHC-insured loans, and 90 per cent of those in the private sector.
“I think the government is sending us a clear signal that there are boundaries it intends to enforce,” said David Liu, vice-president and head of operations at PMI Canada.
PMI is still trying to figure out what the move means for its business, including deciding whether it will continue to provide insurance for 40-year and no-money-down mortgages without the government guarantee, he said.
While such a move has risks, it could give private insurers an edge over the CMHC.
With files from Kevin Carmichael
JS Halifax
Jul 29th 2008, 2:59 pm
#22
Banned
Joined: Dec 2005
Location: In Limbo
Posts: 15,706
Re: Real Estate Nova Scotia and the Credit Crunch
TD dont even bother to qualify you if you have a 35% deposit. So 3.3x is untrue in that case
Jul 29th 2008, 6:07 pm
#23
RETIRED Realtor
Joined: Aug 2006
Location: Winnipeg, Manitoba
Posts: 2,087
Re: Real Estate Nova Scotia and the Credit Crunch
Thats not been my experience, though they don't require you to have a job, or good credit, they do like to know that you have an income sufficient to afford the monthly repayments.
Jul 29th 2008, 6:09 pm
#24
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Re: Real Estate Nova Scotia and the Credit Crunch
Jul 30th 2008, 5:47 am
#25
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Re: Real Estate Nova Scotia and the Credit Crunch
If it is being reduced then it could have been on the market a while. At the moment properties with oil heat only are the ones that large property owners are getting rid of.
Watch out for Capital Gains.
Jul 30th 2008, 6:22 am
#26
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Location: Nova Scotia
Posts: 429
Re: Real Estate Nova Scotia and the Credit Crunch
Housing on the south shore of NS is popular with buyers from UK and USA, so the recession is going to probably affect the market there more than other areas of NS. The problem with buying something cheaper now and renovating is that who are you then going to sell it to when you've finished? The market from Chester down to Yarmouth seems to have been hit harder than others, especially since it became necessary for travellers between Canada and USA to have passports. Although it is a relatively short flight from UK to NS, the cost has risen considerably over the past 12 months, and over winter you only have Air Canada making direct flights, which again cuts down on your market. With the cost of fuel rising, people are going to be more reluctant to travel longer distances to work - and the main work in NS is around the Halifax/Dartmouth area. I was interested to see Tradewinds had a 2 page spread in the UK Sunday Times property section a few weeks ago, advertising houses in NS for upwards of 100kGBP, obviously thinking these prices look attractive to overseas buyers. As those of us living here know though, you can get much better deals than that, even if you are looking at living on the ocean or lakes. There are definitely prices for locals and those "from away" and you need to be familiar with these. Also, the capitals gains tax, costs involved in buying etc. need to be taken into account. Strangely enough, this is one of the few places we've lived in that there doesn't seem to be a big market for flipping houses - and there has to be a reason for that
You will also find that house selling here has seasons, most serious sellers marketing their houses between March-October, with the most active period seeming to be around April-July. If you look over the winter months you might find better bargains as people don't want to leave houses empty then.
You will also find that house selling here has seasons, most serious sellers marketing their houses between March-October, with the most active period seeming to be around April-July. If you look over the winter months you might find better bargains as people don't want to leave houses empty then.
House selling is less seasonal now than it use to be. Many people enjoy their houses in the summer and then place them on the market in the fall. The better buys are to be found after they have hung around for the winter, having been marketed all the previous summer.
I have come across some large amounts being made by property flippers. Eg. Purchased for less than $50,000 sold for $180,000 less than a year later.
There are not just buyers from those places you mention that would be in the market for newly renovated properties, but other countries and other parts of Canada. The South Shore is not the only area of NS with high end properties.
Jul 30th 2008, 1:01 pm
#27
One Quarter Canadian
Thread Starter
Joined: Jul 2008
Location: Essex
Posts: 62
Re: Real Estate Nova Scotia and the Credit Crunch
Hi, How do you find building work compared to the UK, on our current house we added a two story side extention. I dug the footings got a local readymix co. to fill them. I then hired two brickies on a day rate, they built upto roof hieght in 5 days. The outer skin is face brick. I fitted floor joists and a mate added the roof structure. I stripped all the tiles and felt off the old roof and then felt and battened the whole roof, i fitted new roof tiles. I got a little help with the ridge tiles although i cut them. I fitted new upvc windows. I did allthe electrical work and my dad helped with plumbing. I then employed a plasterer and the rest of the finishing was done by me.
When i was in NS i bought a copy of the 2005 building code. I imagine timber frame work is alot faster to complete.
What pitfuls have you found?
When i was in NS i bought a copy of the 2005 building code. I imagine timber frame work is alot faster to complete.
What pitfuls have you found?
Both these routes will cost you money when they are up and running again. They come under the NS NP Economic Stream. This stream is currently under review. We gained residency in 8 months via the NSNP CI stream because we were self employed property developers in the UK and wanted to do the same here. We have been here 3yrs now and seen large increases in property values especially around our area.
If it is being reduced then it could have been on the market a while. At the moment properties with oil heat only are the ones that large property owners are getting rid of.
Watch out for Capital Gains.
If it is being reduced then it could have been on the market a while. At the moment properties with oil heat only are the ones that large property owners are getting rid of.
Watch out for Capital Gains.
Jul 30th 2008, 7:44 pm
#28
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Location: Normandy, France and occassionally Nova Scotia!
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Re: Real Estate Nova Scotia and the Credit Crunch
[QUOTE=Paradisefound;6626758]Can you point me in the direction of one of those properties you are talking about being under $100,000 for waterfront and being livable in?
We viewed 2 properties in Annapolis Royal last week, one for C$56 000 and the other for C$48 000, both on the harbour. We also saw one in Hampton, on the beach,for C$98000. At Victoria Beach we saw 2 more.
We have made an offer on the one, will post MSL link if we get it.
In Bridgetown - although not on the seafront, but on a riverfront - we saw a 4 bed house on 1/2 acre for C$44 000, it had new roof, and did not require any major renovations.
If you do a check on MLS for the Head of Jeddore/Sheet Harbour area you will also find properties on the water for under C$100 000.
We viewed 2 properties in Annapolis Royal last week, one for C$56 000 and the other for C$48 000, both on the harbour. We also saw one in Hampton, on the beach,for C$98000. At Victoria Beach we saw 2 more.
We have made an offer on the one, will post MSL link if we get it.
In Bridgetown - although not on the seafront, but on a riverfront - we saw a 4 bed house on 1/2 acre for C$44 000, it had new roof, and did not require any major renovations.
If you do a check on MLS for the Head of Jeddore/Sheet Harbour area you will also find properties on the water for under C$100 000.
