Investor’s Don’t Short Sell!!!!!!


I recently had a conversation with a great friend and top Re/Max Realtor in Toronto Ashley Fray. We were catching up and discussing current market trends and how the new mortgage rules have affected things. It appears, they have had a dramatic impact quiet fast, especially on the un informed investors. Here is why, but there is another solution so read on.

Since investors now need 20% down payment for rental properties most have only put down 5-10% on pre construction. It appears a lot of people are in this position and having to assign units at below purchase prices. This is causing some new un lived in suites to be up for sale, so sellers are scrambling for buyers or risk losing all of their down payments. This fortunately can be avoided. Do not be one of those sellers, get informed.

Another reason is that since amortization periods have been cut by 5 years. Now the monthly cost to maintain is higher and it is more difficult to have a cash positive property in Toronto. Costs have gone up by 150-250 per month, as opposed to what the buyers were originally anticipating. Paying money out-of-pocket is not something most want out of their rental properties.

The new mortgage rules only affect CMHC insured loans and mortgages. Your mortgage professional still has access to equity and alternate A lenders. Also, we have access to Genworth Financial who is another insurer of Canadian Mortgages. Sometimes getting a loan at a little higher rate for one year so you can properly market your property is better than losing money on a rushed sale.

Companies all over still over 35 year amortization rates. Lenders like HomeTrust and Equitable Trust have great products. Other lenders are available as well, making the variety of choices and options for clients numerous. Being well-informed of what your needs are is crucial to making a sound and informed decision. Working with a professional agent who has proper contacts and referrals is key. They can guide you through unforeseen situations and minimize your loses. With finances and real estate always get a second opinion as you would do with a medical or law professional. Learn from your mistakes and always have a plan B.

To find out how you can get a rental property loan or to discuss your situation please contact me at wpianka@mortgagealliance.com.

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About wojciechpianka

After a few years of studying English and History at the University of Toronto, I decided to transfer to Ryerson University and pursue a Bachelor of Commerce degree. While studying, I worked various jobs where I acquired many skills. Starting as a teller at Scotiabank, I moved on to being a manager of a restaurant, admin staff at a medical clinic, a sales agent for INGDirect and a manager at One King West Hotel. While all these jobs challenged me, I never felt my potential being utilized. Finally in 2008, I completed the Ontario Mortgage Agent Course and signed up with The Mortgage Alliance Company of Canada. This was a great decision, as it allowed me to use the skills I learned working to help people achieve their real estate and financial goals. My passion for real estate and numbers has lead me to becoming a mortgage agent. Growing up in New York City, I always had a fascination of historic buildings and skyscrapers. At 21, I bought my 1st property and have been investing in real estate ever since. I firmly believe thru steady, safe and conservative investing a one can obtain long term financial wealth. One day, I hope to develop the same buildings I help clients purchase.
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One Response to Investor’s Don’t Short Sell!!!!!!

  1. Quality post.Keep up the good work.

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