Market Update

What a summer!

• Canadian mortgage qualification changes: In early July, the Department of Finance announced alterations to the government insured program. CMHC will not be accepting mortgage applications for 40-year amortizations or 100% financing on or after October 15, 2008. CMHC will continue insuring 35-year amortizations & 95% financing. The changes are designed to protect and strengthen Canada's housing market.
• The Bank of Canada overnight rate remains unchanged at 3%. The next rate announcement is scheduled for October 21, 2008.
• In early September, America's 2 largest mortgage companies, Fannie Mae and Freddie Mac were taken over by the U.S. government. And, a couple of large U.S. investment banks became casualties as a result of the sub-prime mortgage mess. Thank goodness Canada's mortgage regulations and consumer qualifications are far stricter than in the U.S.
• Oil is more affordable but it's still high: The price of oil has dropped from a high of $147 a barrel in early July to around $100 a barrel on September 18th.
• Canada's 40th election is called. Voting is scheduled for October 14, 2008.
  

Ottawa Resale Market Highlights

• The Ottawa Real Estate Board reported that year to date (to the end of August) 76% of all residential and condo resales were less than $350,000 (refer to Graph below). Ottawa is an affordable city compared to the other major centres in the country;
• Although the number of sales decreased by 4% during the same period last year (a record year) it's important to note that the number of sales this year were up 3.2% compared to the end of August 2006;
• The end of August 2008 witnessed an increase in the number of active MLS listings compared to the same time last year—there were approximately 800 more properties available for sale.
• Through August, the average time to sell a property in Ottawa was 33 days compared to 42 days over the same period last year.
  

Real estate economies are local by nature. Ottawa has a stable local economy. Ottawa continues to experience high employment in both the public and private sectors, along with rising incomes and strong consumer confidence. It doesn't experience the wild fluctuations witnessed in other areas of the country that have manufacturing based economies.

The prediction for Ottawa housing is for prices to increase marginally in the short term.

Canada’s National Do Not Call List (DNCL) took effect September 30, 2008.

The National DNCL isl a nationwide registry that allows you to reduce the number of unsolicited telemarketing calls you receive. Previously, each telemarketer was required to maintain its own ‘do not call list’, which you had to register on separately to reduce or avoid calls. With the National DNCL, you only have to register your telephone number on one list.

Telemarketers are required by law to subscribe to the National DNCL. It is their responsibility to ensure numbers on the list are not called. This new legislation gives the Canadian Radio-television Telecommunications Commission (CRTC) the power to assign penalties of up to $1,500 per infractions for individuals and $15,000 for corporations that do not follow the National DNCL rules.

Exceptions to the list include calls from charities, political parties, polling companies, newspapers selling subscriptions, and organizations with which the consumer has an existing business relationship.

Consumers can now register either by calling 1-866-580-DNCL (866-580-3625) or online at www.LNNTE-DNCL.gc.ca. Canadians can add their home number, cellular or fax numbers to national do-not-call-list. Calls will not stop immediately; telemarketers have 31 days to update their calling lists. You must renew every three years if you wish to remain on the List. As well, if your numbers change, you will have to register yor new numbers.

New federal law requires real estate agents & brokers to collect personal ID from buyers and sellers.

Your REALTOR® requires this ID information to comply with the law. It is the federal Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) that requires financial institutions and real estate agents, among other professionals and services covered by the legislation, to identify customers who conduct financial transactions. These include depositing of funds or buying and selling real estate. This regulation came into effect June 23, 2008 and is enforced by the federal agency known as the Financial Transactions and Reports Analysis Centre of Canada, or FINTRAC.

REALTORS® must now document personal information and proof of the identity of their client in each and every transaction, including occupation. If the client is a corporation, that information must include corporate documentation, and the names of the corporation directors. They must also determine if a third party is involved in the transaction.

The compliance requirements effect even a buyer or seller not using the services of a licensed REALTOR®. If there is a real estate agent involved in the transaction, they are also required by law to verify that private buyer or seller’s information as well.

In addition to verification of personal information, real estate agents must also complete a report on the receipt of ALL funds received during the real estate transaction. In order to comply with these new federal regulations, REALTORS® are required to keep these records file for 5 years and provide it to FINTRAC if requested.?