Tag: hot housing market

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BABY BOOMERS CHARACTERISTICS: BABY BOOMERS DIVIDED ON WHETHER OR NOT TO DOWNSIZE

baby boomers characteristicsBaby Boomers characteristics: Introduction

There are now some new Baby Boomers characteristics. Baby Boomers are now between the ages of 54 and 72. Their new characteristics are now defined by definitely not being a one-size-fits-all group. The broad range in their ages and stages has divided them on whether or not to downsize.

Baby Boomers characteristics: The issues

Baby Boomers are healthier and working longer than previous generations; as a result, they’re not ready to sell their homes and downsize or move into retirement facilities. Others may not want to sell and downsize because of the hot housing market. And there’s a significant generational change that is preventing Baby Boomers from downsizing – their kids haven’t moved out.

Baby Boomers characteristics: Some stats

Statistics Canada reports that just over 33% of young adults, aged 20 to 34, lived with their parents in 2016. In Ontario, the number was higher – 42.1%.

According to a survey by Royal LePage:

  • 59% of Baby Boomers are renovating rather than moving
  • 52% of Baby Boomers say they won’t be downsizing
  • 18% of Baby Boomers said they didn’t expect their children to leave home before the age of 30
  • 9% of Baby Boomers said they didn’t expect their children to leave before 35
  • In Ontario, 50% of Baby Boomers would help their children buy a home
  • 44% of Baby Boomers would be willing to contribute up to 25% of the cost of their child’s home

Baby Boomers characteristics: Baby Boomers not downsizing

Although economists expected Baby Boomers to downsize in large numbers, that just isn’t happening. With the relatively new phenomena of adult children living at home, Baby Boomers are making the decision to renovate instead of move.

Downsizing is increasingly shifting to their 80s when they can no longer care for their homes. Although it’s a generous thought to help your children buy a house, Baby Boomers really need to consider whether or not that makes good financial sense for them or can potentially jeopardize their retirement. In addition, helping your children purchase a house that they can’t afford may do more harm than good.

Baby Boomers characteristics: Some Baby Boomers need a financial plan

If you’re in a financial quandary because you’ve helped your adult children purchase a house, or if they now find themselves with a house they can’t afford, seek professional help immediately. Ira Smith Trustee & Receiver Inc. is a full-service practice serving people just like you throughout the Greater Toronto Area (GTA) who need a plan for Starting Over, Starting Now. Give us a call today. We can give you peace of mind and set you on a path to debt free living.

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THE EVOLUTION OF MORTGAGE FRAUD CANADA DUE TO AVERAGE HOME PRICES TORONTO

average home prices toronto 5Average home prices Toronto: Introduction

Everyday we’re inundated with stories in the newspapers, on television and online about the average home prices in Toronto and in the rest of Canada. Many are left wondering what they can possibly do to get into this very hot market. Unfortunately as a result there’s been a surge in mortgage fraud.

Average home prices Toronto: What is mortgage fraud Canada?

Mortgage fraud takes place when fraudulent information is used to qualify for a mortgage. A classic example of mortgage fraud is a prospective home buyer submitting fake or altered employment letters, bank statements or tax returns to qualify for a large mortgage.

Average home prices Toronto: How prevalent is mortgage fraud Canada?

According to credit reporting agency Equifax:

  • The number of mortgage applications flagged as potentially fraudulent has risen 52% since 2013
  • About 90% of all mortgage applications flagged for potential fraud have come from banks and not other types of mortgage lenders, largely because banks have become better at spotting fraud attempts
  • 13% of Canadians told Equifax it was okay to tell “little white lies” on their mortgage applications
  • Roughly 67% of mortgage applications flagged for fraud came from Ontario
  • Approximately 12% of suspected mortgage fraud came from British Columbia
  • Only 8% admitted to actually falsifying information on their own credit applications

Average home prices Toronto: Why are typically law-abiding Canadians being driven to commit mortgage fraud in Canada?

It’s no secret that home prices are continuing to rise. The latest federal legislation has made it more difficult to qualify for an insured mortgage. Many Canadians are realizing that home ownership is beyond their reach. In fact according to an online survey by Equifax, 84% of Canadians felt the country’s housing market had become too expensive for first-time buyers. Of those who didn’t own a home, 20% said they worried they may never be able to save enough for a down payment. Clearly desperate times are calling for desperate measures and a surge in mortgage fraud is the result.

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Average home prices Toronto: What should you do if you have too much debt?

Committing a crime is never the answer. And make no mistake, mortgage fraud is a crime. It can be punishable by hefty fines and/or jail. If your goal is to buy a house, we can’t do anything about the real estate prices, but the Ira Smith Team can help you get your debt issues under control so that home ownership may be in your future. Give us a call today so that Starting Over, Starting Now you can conquer debt and start saving for your future.

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DO YOU NEED A HOUSEHOLD BUDGET? MOST CANADIANS DO!

household budget, household debt, canadian household debt, G7 nations, debt-to-income, debt service, debt service obligations, binge borrowing, hot housing market, low interest rates, trustee, debt, debt settlement program, ira smith trustee, starting over starting nowMany Canadians must not follow a household budget. Canada has a lot to be proud of, but not the dubious honour of being a world leader in household debt among G7 nations. The G7 nations are Canada, United States, United Kingdom, France, Germany, Italy and Japan and together the gross domestic product of these seven member nations makes up approximately 50% of the global economy. Unfortunately we are leading our member nations in household debt.

Canada’s household budget watchdog says household debt continues to reach new highs!

According to the Parliamentary Budget Office (PBO), Canada’s budget watchdog, Canadian households could soon be carrying the heaviest debt-to-income loads in history, reaching 174% later this year. Who is the household budget watchdog in your home? If you are the average Canadian, the answer is nobody!

Any sudden economic change can spell financial disaster for your household budget.

The danger is not so much the level of the debt relative to income, but whether we can meet our debt service obligations. Do we have enough disposable income to pay our debts? In increasing numbers Canadians do not have enough disposable income to pay their debts. And, even if they do now, many Canadians are in an extremely vulnerable state.

Any sudden economic changes like a job loss or higher interest rates can spell economic disaster. According to the PBO, our household debt servicing capacity will become stretched further as interest rates rise to normal levels over the next five years. Canadians have been binge borrowing as a result of historically low interest rates and these low interest rates are in large part responsible for the hot housing market.

If you are following a household budget, have you left any room in it for an increase in interest rates, and therefore debt service costs? Canadians are getting in over their heads and could face financial crises when the housing market cools down or interest rates rise.

What will you do if the housing market cools down and/or the interest rates rise? What will it do to your household budget?

The economic warning signs are out there. If you’re trapped in high household debt, you need a professional trustee to help you manage the situation before it reaches a critical stage where bankruptcy is your only option. We have been able to help many individuals carry out a successful debt settlement program. The first step is a realistic household budget. Successful completion of such a program, will free you from the burden of your financial challenges to go on to live a productive, stress-free, financially sound life.

If you’re like many Canadians on the brink of a financial crisis, you need the help of a professional trustee today while you have options. The Ira Smith Team can help before disaster strikes. There is a way to manage debt Starting Over, Starting Now. Contact us today.

Call a Trustee Now!