March 2012 Canadian Economic Fundamentals

[Ally]

Fixed mortgages the way to go, says economist





As the federal government warned it may again tighten mortgage rules, a Bank of Montreal economist says fixed mortgages `clearly trump` variable mortgages in today`s economy.




There are two reasons for the change of heart by Douglas Porter, deputy chief economist at BMO: the intense competition among lenders and the economic recovery in the U.S.




`While we have in the past supported going variable, and even though short-term rates are likely to remain low this year, current offers on long-term mortgage rates and the recent shift in bond market sentiment tilt the balance heavily in favour of locking in at this stage,` wrote Porter in a report, Time to Say Goodbye to Variable.






Read the full article here.

 

[Ally]

Market may be peaking, CREA says




OTTAWA - Price increases in Canada's booming housing market may be topping out, according to the latest survey by the country's largest real estate organization.




The Canadian Real Estate Association says the survey of five major housing markets showed prices continued to rise in February.




However, the 5.1 per cent year-over-year increase in February was the smallest since June 2011. It was also the fourth consecutive month in which gains slowed.





Read the full article here.

 

[Ally]

BMO sees cloud forming over mortgages, says it's time to lock in




OTTAWA The days of super-low mortgage rates that made home ownership dreams a reality of many Canadians may be numbered, says the Bank of Montreal.




The bank`s advice? Say goodbye to variable mortgages and lock in longer-term fixed rates while the going is still good.




In a report released Friday, BMO economists Douglas Porter and Benjamin Reitzes argue that with the United States recovering gathering steam, central bankers on both sides of the border are becoming more comfortable with the economy and less so with historically depressed interest rates that in Canada are fanning the flames of the hot housing market.





Read the full article here.

 

[Ally]

The key to making it as a landlord





Leaky faucets, broken water heaters, late rent - these aren't the only issues landlords have to deal with.




In the 12 years Rod Faulkner's been renting out properties in Calgary, he's dealt with unpaid gas and water bills, one physical threat and three trips through the civil-court system to sue for damages.




"In the 12 years, people have scammed me in just about every way imaginable," says Faulkner, who owns 12 Calgary revenue properties. "And every time I get scammed, it costs me money and I learn a new lesson."




Read the full article here.

 

[Ally]

Pain at the pump may be more acute for Americans




Sure, U.S. drivers pay less for gasoline than Canadians ` but Americans may be feeling the pain at the pump more intensely than we are.




The reason is that the pace of price increases has been far higher in the United States than here, thanks to the rise of the loonie.




The Canadian dollar has appreciated by a third against the greenback over the past decade, cushioning the impact of surging prices for crude oil, which is bought and sold in U.S. dollars.





Read the full article here.

 

[Ally]

Canadian oil giants set to make killing off the coming 'industrial revolution' in America




Last week, Citi analysts argued that technological breakthroughs`particularly in shale oil extraction`that will allow energy companies to exploit petroleum resources that were formerly inaccessible could spark an `industrial revolution` across the North American continent.




In fact, they think that oil production could almost double`in just the next 8 years!




A follow-up report from Citi`s equities team highlights the companies that are already in position to take advantage of this energy boom. While analysts argue that the effect of an energy boom would be transformative and extend far beyond the oil industry, these are the companies that will be directly and locally impacted by the technological breakthroughs in resource extraction.



Read the full artilce here.

 

[Ally]

Do you need a real estate agent?





Vancouver Island resident Barry Christie has been having a hard time selling his house thanks to a glut in inventory. He started out using a real-estate agent about a year ago, but after several months -- and little progress made -- Christie decided to go rogue, putting up a for-sale sign on his front lawn before posting an ad on Craigslist.







He had a glimmer of hope when he got a response on the local classifieds website soon after. However, after a few email exchanges it became clear the person on the other end wasn`t sincere ` instead of asking to see the home, he asked Christie for his bank-account information.







Read the full article here.

 

[Ally]

Swedish firm aims to buy 10,000 apartments in the next 3-5 years





Akelius Real Estate Management Ltd., Sweden`s largest private own multi-residential company, has set its sights on the Canadian apartment market.







Over the past few months the company has purchased five properties (209 apartments) in Toronto and intends to buy another 800 units this year. Canada`s largest city is its primary focus currently but Akelius does intend to buy in other major centres in the future.







Akelius, which has a property portfolio of 35,000 apartments in Sweden and Germany, views Canada as a place with characteristics that are very similar to its home market: relatively safe and stable and with a growing population due to a steady influx of immigrants.







`We researched the U.S. too and the [finding] was Canada has the good things of the U.S. but not the bad things,` said Jordan Milewicz, the President of Akelius.







Read the full article here.

 

[Ally]

Clock is ticking on Canada's mortgage wars



The clock is about to strike midnight for mortgages rates that have been the best deal of the past half century ` at least as far as the major banks are concerned.





Bank of Montreal`s recent cut-rate 2.99% five-year fixed closed mortgage is set to expire March 28 and, not surprisingly, competitors have already signalled they are ready to raise rates in the wake of the sale ending.





Royal Bank of Canada and Toronto-Dominion Bank were the latest to do so, announcing they had ended their offer of a 2.99% rate on closed four-year mortgage. Bank of Nova Scotia had quietly been telling mortgage brokers last week that it had planned to do the same.





Read the full article here.

 

[Ally]

CMHC's reins get pulled back



CMHC is throttling way back on its mortgage insurance business.





That was the eye-catching revelation in its corporate plan released last week.





The nation`s largest mortgage default insurer plans to end this year with `just` $557 billion of insurance on its books. That`s notably less than most people expected, and 7.2% below its much-publicized $600-billion insurance limit.





Read the full article here.

 

[Ally]

Housing market resilient in Q1, 'heated' spring expected: Re/Max




MISSISSAUGA, Ont. - Major Canadian housing markets have continued to show "exceptional resiliency" so far this year, setting the stage for a busy spring, according to a major Canadian real estate organization.




In its market trends reports, Re/Max said its survey has found that 12 of 15 Canadian centres, or 80 per cent, reported sales activity in January and February that was ahead of last year`s levels.




More than half of the cities reported double-digit increases, "with the strong demand and diminished supply setting the stage for a heated spring 2012."




Re/Max said low interest rates, coupled with strong consumer confidence levels and a mild winter played a significant role in the upswing, ushering in an early start to the spring market.





Read the full article here.

 

[Ally]

Canada gas prices: 10% jump in one year among highest in developed world




If it seems like gas prices have been rising particularly quickly in Canada, that`s because they are.




According to a new analysis by The Economist, in the past year the price at the pump increased faster in Canada than in a majority of developed nations. Though gas here remains cheap compared to many countries, the amount Canadians have been forking over at the pump was up 10 per cent in February over the same month the previous year, putting Canada eighth out of 28 countries in terms of the rate of increase.




But while Canadian consumers are no doubt feeling the pinch, Earl Sweet, managing director of economic research at BMO Capital Markets, cautions against reading too much into the international comparison.





Read the full article here.

 

[Ally]

Penny killed in 2012 budget




OTTAWA -- There may still be pennies from heaven, but they won't be coming from the mint much longer.




The humble one-cent piece is set to disappear from Canadian pockets, a victim of inflation.




Thursday's federal budget said the Royal Canadian Mint will strike the last of the little coins this fall.





Read the full article here.

 

[Ally]

Federal budget highlights 2012






March 29, 2012 |The Federal budget was unveiled Thursday afternoon on Parliament Hill. Finance Minister Jim Flaherty announced the deficit is projected to fall $8.5 billion, to $24.9 billion for 2011-12, to decline to $21.1 billion next year and to disappear by 2015.




Other highlights includeroduction of the penny to cease this fall, saving an estimated $11 million a year.Age of eligibility for old age security and the guaranteed income supplement to gradually move to 67 from 65, beginning in 2023.





Read the full article here.

 

[Ally]

A fresh future for the forestry industry





The Canadian forest industry is a place to grow. It is a place to grow a career, investments and innovative ideas.







In a previous column, I talked about the changing face of the forest sector in Canada. After a difficult decade, there`s a new buzz and a fresh, new face to the forest products industry. It has become more competitive and productive, aggressively cultivating new products and markets, leveraging world-leading environmental credentials in the marketplace and vigorously pursuing ways to extract more value from every tree in the form of bioenergy, biochemicals and biomaterials. The industry is transforming, brimming with opportunity and on the move.







Read the full article here.