If you have been following the controversy, you probably are aware that the new combined GST and PST (HST) will come into affect on July 1st, 2010.   That’s an extra whammy of 7% being added to purchases (goods and services) that never had them before.  That’s right … instead of paying 5% GST on many goods and services, you will now be paying 13%.

If you are buying a home … will that affect you?  YES … on NEW home purchases.

IF you are considering purchasing a NEW home … now is the time to buy because on July 1st  the price will automatically go up an additional 7%  (total 13%).

Every year The Mortgage Group hands out its annual awards for the Top Mortgage Brokers in Canada.  This is our fourth year in a row to win the award.

Here we are at the annual company party getting our award.  The owners of The Mortgage Group are Grant (left) and Debbie Thomas (right), and that’s us in the middle … Justin on the left and Mike on the right.   The award means a lot to us … as does YOUR continued support!

According to all the financial experts, the answer to that question is an unqualified YES.

In a nutshell, you are taking on a good debt when you are “investing” in your future.  Bad debts are incurred when you are buying something today or paying off something you purchased in the past that will depreciate in value.  Most credit card debts are bad debts … you just HAVE to get that wide screen TV right now. You need a holiday and can’t really afford it, so you slap that onto the credit card as well. You are basically taking on debt with no hope of ever recouping your interest payments.  You would not be able to resell that TV set for even 1/2 of what you paid for it, the minute after you walked out of the store.

Here are a few examples of good debt … an investment in your future:

• Borrowing money to maximize your RRSP contributions will help you grow your tax sheltered retirement fund faster.
• Investment properties including your home or rental properties.
• Student loans are an investment in a good career, and your future earnings.
• A business loan, will help build and grow your business.

Bad debt will end up limiting your resources becasue you are not only paying for the product or service, but are paying a high price for servicing your debt.

• Maintaining a balance on credit cards or department store cards. If you can’t pay off your credit card monthly, reconsider your purchase.
• Using borrowed money to purchase items that will depreciate in value.
• Cash advances on your credit card. Unlike other purchases, interest starts accumulating the instant you get the cash advance.
• Deferred payments … such as “do not pay until 2011″ have hidden financing charges. You are paying for the “privilege” of the deferred payment, it is just hidden in the setup charges.

Justin Blacklock and Mike Averbach can advise on a mortgage strategy that meets your needs, including consolidating high interest consumer debt into your mortgage.  Call today to learn about all your financing options.

Here’s a market update from our friends at Macdonald Realty; Simon Clayton, Kristie Marsden, Jason Low, Sandra Ens, Jason Feinstadt and Jenny Stephanson.

Last month, we described how, traditionally, the winter months led to a slow-down in the industry and how you could best take advantage of your specific situation. We had one caveat: every situation is different.

Well, it seems as though 2009 may be different.

Sales in October were up 41.5% year-over-year across Canada as low interest rates and greater consumer confidence spurned higher home sales. Prices across Canada have also increased year-over-year to an average of $341,079, up 20.7% from a year ago.

When the financial crisis hit, home-buying effectively froze as buyers sat on the fence waiting to see what would happen. Now that it seems the worst is over, six months of pent-up demand has been unleashed on the market. Given low interest rates, relatively high absorption rates, and, in some areas, increased overseas activity, we expect the market to remain strong – on a seasonally-adjusted basis – for the short-term.

That said, no matter how hot the market is, you’re still unlikely to find a buyer on Christmas Day.

Have a wonderful Holiday Season!

December 2009 Market Update

If you would like to learn more, please feel free to contact us by phone or by clicking on one of the links below:

Simon Clayton 604-764-0711

Kristie Marsden 778-836-4389

Jason Low 604-790-5276

Sandra Ens 604-263-1911

Jenny Stephanson 604-675-6214

Jason Feinstadt 604-263-1911

MacDonald Realty 604-263-1911