Home equity loans can allow Canadian homeowners to leverage the gains they made in what was until recently a red-hot housing market into investments in other sectors. Home ownership, which was once the key fundamental to Canadians’ wealth accumulation strategies, while still important, will likely take a back seat as a strategy in the near term as investment savvy home owners shift their accumulated wealth into other markets. Leveraging built up home equity is a highly advantageous method of making this switch in investment tactics.
The most recent economic forecasts indicate that Canada’s overall housing market has settled into what will be a period of slow growth. Home owners who saw the equity in their homes grow by leaps and bounds as Canada enjoyed its longest sustained housing boom since the Second World War are now sitting on substantial capital that is locked up in their home. But the return on this capital will only grow moderately over the next several years and it is not clear that gains in housing prices will necessarily outstrip inflation.
The latest view from economists at the TD Bank Financial Group is that sales of new and existing homes are likely to continue to decline in the near term and housing prices will only increase modestly. TD’s forecast is that “sales are likely to continue to decline in the coming quarters and price growth will slip to 2% on a national average basis in 2008 and rise only to 3.5% in 2009.” They note that this national average will vary by regional markets, with some local markets that saw the biggest run ups in housing prices – such as those in Alberta and British Columbia – experiencing a drop in housing prices as regional markets adjust. But, they predict, “Most markets will see low to mid single-digit growth.”
The Financial Post reports that most leading economist are expecting the Bank of Canada “to keep interest rates at 3% in 2008 before hiking them in 2009 as inflation becomes more of a concern and the U.S. economy picks up.” Of course, as Canada’s central banker hikes its lending rate, banks, trust companies and other financial institutions will raise their prime rates in due course.
With current low interest rates, homeowners looking for more continued and substantial growth in their existing assets can take out a home equity loan for investment purposes and purchase a risk balanced investment portfolio that is highly likely to carry a much better return than the moderate housing price increases that are forecast for the rest of 2008 and into 2009. The bonus is that the interest paid out on a home equity loan taken out for investment purposes is tax deductible. Effectively, the tax savings a typical homeowner/investor is likely to get will in most instances offset a large portion of the borrowing costs. If gains on the investment outstrip, as they should, the moderate gains forecast for housing purposes, homeowners who leverages their home equity in this manner will see real growth in their overall assets.
An abundance of caution should of course be used when leveraging your home equity in this manner. Ensuring that the investment portfolio you choose is well balanced is a key. Working with an experienced and knowledgeable financial planner is highly recommended, as is working with a mortgage broker to access the best available rates and terms for a home equity loan while interest rates remain at their current low level.
Q7: What are foreclosures and how do I learn more about buying foreclosures? Can you save a huge amount of money here? Save money, usually. A huge amount of money, occasionally. In many cases, though, these will be homes that need work. For foreclosure listings, check ForeclosureNet, which has a free trial period with access to their database.You need foreclosure help, if you fall behind on your house payments, your mortgage lender may start a foreclosure action and sell your home at a Sheriff’s sale. If the sale nets less than you owe, there will be a “deficiency balance” that you will own to the lender. This debt is considered unsecured debt since the lender no longer holds your house as collateral.
Where can I get a list of Foreclosures? you are well aware, information is power. But any information is only as powerful as its accuracy, relevancy and timeliness. This is why we have assembled a unique team of researchers to compile a complete record of foreclosure properties throughout British Columbia. These listings are emailed to our members every week.A foreclosure property is a home that has been repossessed by the lender because the owners failed to pay the mortgage. Thousands of homes end up in foreclosure every year. Economic conditions affect the number of foreclosures, too. Many people lose their homes due to job loss, credit problems or unexpected expenses.
Q7: What are foreclosures and how do I learn more about buying foreclosures? Can you save a huge amount of money here? Save money, usually. A huge amount of money, occasionally. In many cases, though, these will be homes that need work. For foreclosure listings, check ForeclosureNet, which has a free trial period with access to their database.Our catalog of foreclosed homes and land come from many sources. Some are government foreclosure properties such as Housing and Urban Development (HUD) homes, some are Veterans Affairs (VA) homes and some are lender owned REOs.
What are Bank Foreclosures? Bank foreclosure properties are also called real estate owned properties or REOs. This homes that remained unsold after the auction and the lender takes it back and sells it.The simplest way to buy a pre-foreclosure property is to contact the property owner personally. Call or write them a letter; they are still the property owners after all. Most importantly, they will know about the physical condition of the house as well as the financial details on the property.
How do I find Foreclosures? Foreclosures in Canada are not typically listed or published, so there is a lot of work and research involved in finding foreclosures. There are some real estate agents that may have a minimal number of foreclosure listings, but they are very few and far between. It is for this reason we offer a complete list of foreclosures to investors.Can you save a huge amount of money here? Save money, usually. A huge amount of money, occasionally. In many cases, though, these will be homes that need work. For foreclosure listings, check ForeclosureNet, which has a free trial period with access to their database.
Are the properties on your list Foreclosures or Pre-Foreclosures? In essence, you are either in foreclosure or you aren’t. From this point of view our properties are in foreclosure, which is often called pre-foreclosure. This effectively means that the properties are in foreclosure, but have not been foreclosed on by the lender yet. Once the properties have been foreclosed on by the lender they are then referred to as REO (Real Estate Owned by the bank / lender) properties and are no longer in foreclosure.Seminars ? our seminars are not classes taught by gurus from some other state in order to sell expensive books or CDs. Our seminars are taught by local foreclosure investors who teach you the real step-by-step mechanics of making money in the Illinois foreclosure market.