QUOTE (Don @ Sep 16 2007, 01:34 PM) Here is another good story looking at the importance of the 35 - 40 year amortization programs offered by the Canadian Banks. It was in the National Post on Saturday September 15th and it looks at how these programs are affecting the real estate markets across the country.
http://www.canada.com/nationalpost/financi...ee-4d981da6dbcd
It is [longer amortization] such a big factor now that last "Housing Affordability" report is the first one to introduce it and says:
QUOTE Longer amortization mortgage products are a large and growing share of monthly mortgage originations, particularly in the high ratio mortgage segment. This development has unfolded within the past year and a half as the market has gone from standard 25-year options towards 30-, 35- and 40-year mortgages.
Because our affordability calculations assume a standard 25-year conventional mortgage in order to allow for a common benchmark over time and across markets, the result is that the share of household income going towards home ownership costs is likely overestimated for some entrants in today`s market.
Report is available at:
http://www.rbc.com/economics/market/pdf/house.pdf
Best regards,
Boris
http://www.canada.com/nationalpost/financi...ee-4d981da6dbcd
It is [longer amortization] such a big factor now that last "Housing Affordability" report is the first one to introduce it and says:
QUOTE Longer amortization mortgage products are a large and growing share of monthly mortgage originations, particularly in the high ratio mortgage segment. This development has unfolded within the past year and a half as the market has gone from standard 25-year options towards 30-, 35- and 40-year mortgages.
Because our affordability calculations assume a standard 25-year conventional mortgage in order to allow for a common benchmark over time and across markets, the result is that the share of household income going towards home ownership costs is likely overestimated for some entrants in today`s market.
Report is available at:
http://www.rbc.com/economics/market/pdf/house.pdf
Best regards,
Boris