OTTAWA, February 28, 2014 — Following the annual review of its insurance products and capital requirements, CMHC will increase its mortgage loan insurance premiums for homeowner and 1 – 4 unit rental properties effective May 1, 2014.

The increase applies to mortgage loan insurance premiums for owner occupied, self-employed and 1-to-4 unit rental properties, including low-ratio refinance premiums. This does not apply to mortgages currently insured by CMHC.

For the average Canadian homebuyer requiring CMHC insured financing, the higher premium will result in an increase of approximately $5 to their monthly mortgage payment. This is not expected to have a material impact on the housing market.

Effective May 1^st, CMHC Purchase (owner occupied 1 – 4 unit) mortgage insurance premiums will increase by approximately 15%, on average, for all loan-to-value ranges.

CMHC reviews its premiums on an annual basis and, going forward, plans to announce decisions on premiums in the first quarter of each year.

Based on a 5 year term @ 3.49% and a 25 year amortization

Based on a 5 year term @ 3.49% and a 25 year amortization

Forecast for 2014:  value of MLS® sales in 2014 will increase by about 3% for the year after sales of $8 billion in 2013. This is based on an overall increase in the number of homes sold and increased prices.

The sale of single family homes in Edmonton will be static, at about 10,500. The number of sales of condo, duplex and rowhouse sales will increase by 2.5% throughout the region as these properties become the de facto entry point for first time buyers.

Prices, as usual, will fluctuate through the year but the 12-month average price for a single family detached property is anticipated to increase about 3%. Condominium property average prices are projected to increase about 2% over the year.

Market growth is always good for the seller who can expect to see a capital gain on their property. But it is also reassuring for the buyer who can expect steady growth upon entering the market.

The all-residential average price for the first three quarters of the year in the Edmonton CMA is $350,741 as compared to $340,090 in 2012. In September, the all-residential average was $352,057, up 5.4% from a year ago and inching up from $351,455 in the previous month.

Year-over-year sales were also up 19.4% with 1,466 (adjusted, 1,357 actual) all-residential sales in September. There were 13,691 residential sales in the Edmonton CMA in the first three quarters of 2013 as compared to just 12,876 sales at the same time last year.

The market is very active with many properties attracting multiple offers.The increases in the Alberta population are driving the market and because of the steady sales there are inventory shortages at the lower price ranges.

There were 926 (adjusted, actual 857) single-family detached sales in September at an average price of $408,642 (up 3.9% Y/Y) as compared to 773 sales a year ago at an average price of $393,374. Condos sold on average in September for $243,655 (438 adjusted sales, 406 actual), up from $224,330 last September (up 8.6%). Duplex/row house sales were up with 79 (adjusted ,73 actual) sales, valued on average at $338,250 ($316,973 last year).

Average sales prices are the highest they have been in five years,Combined with the highest sales numbers since 2012, we have year-to-date residential sales values totaling $4.8 million. Strong market fundamentals, increasing population and the persistence of low mortgage rates have convinced many buyers that an investment in real estate is secure.

The September sales-to-listing ratio of 65% was the result of 2,089 residential listings and 1,357 residential sales. The inventory of available homes on the Edmonton MLS® System was down from 5,557 units in August to 5,111 units in September. It took 54 days on average (up one) to sell a home in the Edmonton area. Irina Mierzewski has access to all the latest market data and effective marketing tools and is the best source of real estate advice for both buyers and sellers.

MLS® System Activity (for all-residential sales in Edmonton CMA1)

1 Census Metropolitan Area (Edmonton and municipalities in the four surrounding counties)
2 Single Family Dwelling
3 Average: The total value of sales in a category divided by the number of properties sold
4 Median: The middle figure in an ordered list of all sales prices
5 Residential includes SFD, condos and duplex/row houses
6 Includes residential, rural and commercial sales

3 Average prices indicate market trends only. They do not reflect actual changes for a particular property, which may vary from house to house and area to area. Prior period sales figures have been adjusted to include late reported sales and cancellations and therefore reflect a more accurate view of the period than previously reported at month end. The RAE trading area includes communities beyond the CMA (Census Metropolitan Area) and therefore average and median prices may include sold properties outside the CMA. For information on a specific area, contact Irina Mierzewski – your local REALTOR®

Canada is one of the best countries in the world for home ownership. We are now clearly the fastest growing nation in the G8 regarding immigration as recently reported in the Globe and Mail. Canada is setting its sights on an annual immigration of 400,000 people by 2016 up from the current 320,000.
The demand for home ownership across all provinces will be significant for decades. As Canadians we can feel confident that our home will continue to be a place where we raise our families, have our dreams come true and remain a cornerstone of our life long financial wellbeing, despite what the media would like us to believe.
The U.S. economy is showing signs of consistent growth with housing starts and new jobs leading the charge. This of course bodes well for us and is particularly welcome news for our manufacturing and resource sectors.
So the economy on both sides of the border looks promising, immigration will continue to add to the growth of Canada and interest rates are historically low. Regardless of what some might want us to think Canada is Still the Best Place to Own a Home!
If you know anyone who is looking to buy a home, it’s important that they get pre-approved today! The spring market is fast approaching and there is evidence everywhere of a pent up demand. Having that pre-approved mortgage in hand can give someone the advantage over other buyers.
Call or email me today!