Kamran Etessam
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The Reality Behind Promised Programs for Secondary Unit Financing
January 23, 2025
Last year (Oct 2024), the Liberal government announced two programs aimed at helping Canadians finance secondary units:
1) Increasing government loans for secondary unit construction from $40,000 to $80,000.
2️) Allowing insured refinancing deals up to 90% loan-to-value (LTV).
These announcements sparked hope for many Canadians who dreamed of adding a secondary unit, such as a garden suite or an additional rental space, to their homes.
Unfortunately, neither of these programs has been launched to date.What was marketed as an initiative to address housing affordability and support homeowners appears to have been more of a promotional pitch than a practical solution. This lack of follow-through has left many Canadians disappointed and feeling misled.
As a mortgage professional, I regularly spoke to clients who had pinned their hopes on these programs, only to find that the resources they needed never materialized.
It's a reminder that while government initiatives can create excitement, we need to remain cautious and focus on practical, available options to achieve our goals. If you're exploring financing options for home improvements or secondary units, feel free to reach out. I'll help you navigate what is available in today's market.
Warm regards,
Kamran Etessam
Your Trusted Mortgage Professional
Is Pre-Construction Still Worth It?
January 06, 2025
Buying pre-construction homes used to be a sure path to capital appreciation, but that’s no longer guaranteed. Here's a real-life example that highlights the risks:
- Purchase Price: $729,900 (Oct 2021)
- Appraised Value at Closing: $630,000 (Dec 2024)
- Additional Costs: $45,000 (e.g., upgrades, levies, property taxes)
While the buyers avoided bidding wars, they faced unexpected costs, a $100K loss in value, and higher mortgage rates due to market changes.
Key Takeaways for Pre-Construction Buyers:
- Budget for extra costs like levies and upgrades.
- Work with a real estate lawyer to understand all fees.
- Be prepared for market fluctuations that may lower appraised values.
- Secure flexible financing early, and explore the builder's lender for better options.
Pre-construction can offer benefits, but as the market shifts, careful planning and budgeting are critical.
Have questions or need advice on pre-construction purchases? Let’s connect!
Warm regards,
Kamran Etessam
Your Trusted Mortgage Professional
End-of-Year Mortgage Tips to Prepare for 2025
December 14, 2024
As we approach the end of 2024, it’s the perfect time to reflect on your financial goals and prepare for the year ahead. Whether you're a homeowner, prospective buyer, or looking to refinance, here are some essential tips to make the most of this season.
1. Review Your Mortgage Strategy
The end of the year is a great time to evaluate your mortgage and overall financial health.
- Are you on track to meet your repayment goals?
- Could you benefit from refinancing to secure a lower rate or access equity for other investments?
If you're uncertain, a quick mortgage review can help identify opportunities to save money or make strategic adjustments.
2. Take Advantage of Lower Interest Rates
With inflation remaining low and interest rates steadily declining throughout 2024, it’s a favorable time for those considering buying a new home or refinancing. Lower rates can reduce your monthly payments and make homeownership more affordable.
Tip: Lock in a rate now to protect yourself from potential fluctuations in 2025.
3. Plan Ahead for Property Taxes
Many homeowners face property tax deadlines early in the year. Use December to ensure you're prepared, especially if your mortgage lender doesn’t manage taxes on your behalf. Setting aside funds now can help you avoid surprises later.
4. Explore Year-End Opportunities for Buyers
The real estate market typically slows in December, which can mean less competition and more motivated sellers. If you’ve been waiting for the right time to buy, this could be your chance to secure a good deal before the spring rush.
5. Set Financial Goals for 2025
Consider these questions as you plan for the new year:
- Do you want to pay off your mortgage faster?
- Are you planning to purchase a second property or investment property?
- Do you need advice on how to manage debt or improve affordability?
Setting clear goals now will give you a head start when 2025 begins.
6. Consult Your Mortgage Professional
As always, having an expert by your side makes all the difference. Whether you’re exploring refinancing, a new purchase, or just want to understand how changing rates may impact your mortgage, I’m here to help. Let’s work together to ensure your mortgage aligns with your financial goals.
If you’re ready to take the next step, let’s talk! Reach out for a free consultation, and let’s start planning for your success in 2025.
Warm regards,
Kamran Etessam
Your Trusted Mortgage Professional
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Lower Inflation, Lower Rates? What Homeowners Need to Know – September 2024
December 14, 2024
Canada’s annual inflation rate has continued to decline, reaching 2.5% in July – the lowest level since March 2021.
This steady decrease reflects significant progress in controlling high inflation and aligns with forecasts of a potential third consecutive interest rate cut by the Bank of Canada on September 4th.
As Andrew DiCapua, Senior Economist at the Canadian Chamber of Commerce, noted, "There's more to go in terms of reaching price stability as Canadians feel the pinch and pull back on spending, but we think the Bank of Canada will continue their path of interest rate cuts, prioritizing economic growth as inflation moderates.”
This is promising news, especially for variable-rate mortgage holders or those with debts tied to the central bank's rate, as further rate cuts could result in lower interest payments. Additionally, lower rates can improve affordability for prospective buyers, making it a great time to consider entering the market or refinancing.
As your mortgage professional, I’m here to ensure your mortgage is working in your favour. Whether you’re looking to save on interest, considering a move, or simply want to understand how these changes might affect you, I’m here to help. Reach out for a free no-obligation consultation to explore the options available to you.
Best regards,
Kamran Etessam
Your Trusted Mortgage Professional
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