BARBARA GRUMME’S BLOG!

There has been growing concern in the real estate industry about the escalating cost and availability of property insurance. Insurance companies have refused to insure homes that have been previously covered. In other cases, companies have decided to raise insurance premiums by a considerable amount. Provincial governments are responsible for regulation of the insurance industry, including the cost of premiums and the availability of products. The federal government’s responsibility is limited to ensuring that insurance companies are financially sound. If you’re buying a home these days, you have to think about insurance. It could affect whether or not you get the home you want.

Home insurance companies have tightened their underwriting criteria and they’re reluctant to take on risks that may not have bothered them in the past. Banks won’t approve a home loan unless there is proof of insurance.

A number of home insurance issues have been identified that can impact the transaction process. These issues can include:

▪         Aluminum wiring – demands to retrofit and/or change completely to copper

▪         60 amp electrical service – not deemed to be sufficient regardless of the size of dwelling

▪         Knob and tube wiring

▪         Gas furnaces more than 20 years old

▪         Oil tanks

▪         Wood burning appliances – WETT certification is being measured against current building codes

▪         First time buyers without prior home insurance history

▪         Insurability point system now used by insurers which may be detrimental to first time buyers. This includes “red zoning” because of the location of the property

 

This information is by

CREA

The Canadian Real Estate Association

Info@crea.ca

Serving North American Families since 1972

One of most important investments we make is the purchase of a home. We pay for insurances to protect our new home and its contents. However one of the most important decisions overlooked once we move into our new home is the updating of your Will. A will is like a “Love Letter” for those who you care about the most and who would be able to carry out your wishes for you.

If you don’t have a will you leave it in the hands of the government to make decisions on your behalf. Family & friends who you felt could benefit from a share of your estate, now have to retain legal council at additional expense creating an environment that benefits apposing lawyers then your estate. It can get messy and complicated, which adds trauma and stress.

If you have children you can’t assume that your family will raise them. Your children may be separated and raised in foster care. Why let your children and family go through that when you could leave them you’re “Love Letter”

Congratulations! If you have decided to have your “Love Letter” written, now add something for yourself, a “Power of Attorney” I look forward to sharing more information with you about Powers of Attorney in Barbara’s next newsletter.

Regards Gary Burnett

 

Gary Burnett is a regional manager with PPL Legal Care of Canada, a subsidiary of Pre-Paid Legal Services. He is considered an expert regarding Issues pertaining to Identity theft and has spoken on the radio for many organizations such as the Canadian Institute of Management, Rotary, and the St. Catharine’s & Thorold Chamber of Commerce where he has held the position of Ambassador for many years.

 

You can contact Gary Burnett at 905-227-4271 or ppl@cogeco.ca or visit his website at www.garyburnett.com

 

Go to the web site below.  This site lists all kind of foods

and how to keep them fresh longer as well as when

to get rid of them.  

 

 

                         http://www.stilltasty.com/

 

“10 DIY Cheap and Easy Ways to Protect Your Home” at http://criminaljusticeonlinedegree.org/10-diy-cheap-and-easy-ways-to-protect-your-home/ . Anyway I figured I’d bring it to your attention in case you thought it interesting

Thanks, 

 

Adrienne Carlson

Please find below and article I found regarding the Bond Yields and how there increase should not be looked at as a bad thing. The plan to keep rates low should continue into next year.

 

 

 

Don’t Get Excited By Rising Yields, Suggests Carney  Canada’s head banker, Mark Carney, says bond traders have lost their focus by running up bond yields.

 

He told Reuters: We don’t see, for example, corporate investment really picking up until 2011. 2010 is still going to be a year where policy really matters.”

 

Translation:  Don’t bet on prime rate rising before the end of June 2010 (assuming inflation remains under 3%).  Carney believes our economy still needs low rates.

 

That, of course, is reassuring news for variable-rate mortgage holders.  It’s not so reassuring, however, for people who feel housing prices are getting a bit frothy. 

 

As for the 5-year bond yield, which drives fixed mortgage rates, it’s up four basis points today to 2.78%.  (That’s not too far from the one-year high of 2.91%.)

 

For now, we’ll be awaiting next Thursday’s industrial price index reports, next Friday’s GDP report, as well as the big October employment report on Nov. 6.  Central One Credit Union economist, David Hobden, feels October’s employment figures will be something to keep an eye on.  He says, “Employment is best measure of real economic output.”

 

 

In these trying times you don’t want to lose any potential clients. Now is the time to make sure you help your clients out by recommending the best mortgage agent possible. My experience and knowledge of the mortgage industry has made me successful for over 10 years .

 

 

 

Michael Brooks

Mortgage Agent, FSCO #M08004068

Home Loans Canada, FSCO #10423

PH# 905-329-2223

Email: michael.brooks@hlcmortgages.com

Earlier this year, you wrote to me expressing your views about Ontario’s plan to merge federal and provincial sales taxes into a single HST. I appreciate the time you took to share your thoughts on the subject. And I want to take this opportunity to provide you with new information about our tax changes.

 

A recent report

(http://wcmprod2.ucalgary.ca/publicpolicy/files/publicpolicy/Mintz%20ONL

INE%20(Nov%2009).pdf) by Dr. Jack M. Mintz, Palmer Chair in Public Policy at the University of Calgary, studies the impact that our package of tax reforms, including the HST, will have on our economy.

 

Dr. Mintz’s paper indicates that, within 10 years of the July 1, 2010, start of the HST, Ontario will benefit from:

 

* an estimated 591,000 net new jobs          

 

* increased annual worker incomes of up to 8.8 per cent

 

* increased business investment of $47 billion. 

 

As I indicated in my previous correspondence, we are merging these two sales taxes because it will strengthen our economy. Doing so will reduce costs for Ontario businesses - allowing them to make investments that will enable them to become more competitive and hire or retain more workers. In addition, we are cutting corporate taxes and personal income taxes for 93 per cent of all Ontario taxpayers.

 

To learn more about the tax cuts and rebates that will help you and your family through the transition, please visit www.ontario.ca/taxchange.

 

I hope you find this information useful. Please accept my best wishes.

 

Dalton McGuinty

Premier of Ontario

WHAT ARE THE DIFFERENT TYPES OF

INSULATION?

·

Fiberglass

– Fiberglass is a soft wool-like material that

is usually pink or yellow. It is used as insulation in

weatherproofing, and as textile material. Fiberglass is a glass

product, which is now favoured by most because of its

longevity and durability. It was originally used as a “safe”

substitute for asbestos. Fiberglass insulation was introduced

in the 1930’s. Fiberglass insulation is made by jetting molten

glass through tiny heated holes in a high-speed stream. The

resulting fibers are drawn very thin and to great length. The

fibers are then collected into a matte to produce fiberglass

insulation.

·

Mineral Wool

– “Mineral wool” actually refers to two

different materials: slag wool and rock wool. Slag wool is

produced primarily from iron ore blast furnace slag, an

industrial waste product. Rock wool is produced from natural

rocks. Slag wool accounts for roughly 80% of the mineral

wool industry compared with 20% for rock wool. Given the

relative use of these two materials mineral wool has, on

average, 75% post-industrial recycled content. Wool

insulation is typically a batt-type product and is made from

recycled wool fibers, which are carded and joined together

using an advanced resin bonding process. There is also a

loose-wool form available, which can be blown into ceiling

cavities.

·

Cellulose

– Cellulose is perhaps the best example of

recycled material used in insulation. Most cellulose insulation

is approximately 80% post-consumer recycled newspaper by

weight; the rest is comprised of fire retardant chemicals and,

in some products, acrylic binders. The biggest long-term

performance concern with cellulose insulation is possible loss

of fire-retardant chemicals. Because borates are water

soluble, they can leach out if the insulation gets wet.

·

Foam Insulations

– Polystyrene insulation can cause

irritation of the eyes, nose and respiratory system; headache,

fatigue, dizziness, confusion, malaise (vague feeling of

discomfort), drowsiness, weakness, unsteady gait; possible

liver injury; and reproductive effects. Many foam insulations

use recycled plastic resin such as that found in some extruded

and expanded polystyrene (EPS). Of the foam insulations,

polystyrene is easier to recycle than polyisocyanurate or

polyurethane since it can easily be melted down and reformed

into other products. The simplest recycling involves

crumbling the old EPS into small pieces and re-molding them

into usable shapes. Polystyrene used to be blown with

chlorofluorocarbons, or CFCs that destroy the earth’s

protective ozone layer. Now extruded polystyrene (XPS) uses

hydrochloro-fluorocarbons (HCFCs) that are not as

dangerous but can still be detrimental to the earth’s protective

ozone layer.

Two new types of foam insulations that do not use CFCs or

HCFCs are:

·

Icynene:

Icynene is a foaming agent that uses a mixture

of carbon dioxide and water. Though it does not have

polyurethane’s HCFC-related environmental problems, it

also has a lower insulation rating (R-value). Like

polyurethane, Icynene is foamed into wall cavities but

the resultant open-cell foam is soft, not rigid.

·

Air Krete:

Air Krete™ is inorganic foam produced from

magnesium oxide (derived from sea water). It is foamed

under pressure with a microscopic cell generator and

compressed air; no CFCs or HCFCs are used.

WHAT DO I DO TO REMOVE ASBESTOS

INSULATION?

There are specialized firms that ate certified in removing

asbestos safely. You may be able to locate these firms

through your province or local health department. Do not

attempt to remove it yourself.

by

Tom Vattovaz Hamilton Region 905-572-1116
Canadian Home Inspection Services Construction Engineering Technologist, Niagara Region 905-356-1141
Registered Home Inspector, Other Areas 800-463-1141
Septic & WETT Certified

 

Potential owners of a house would like to know if there is heat loss in the house or moisture areas that can cause mould (eg. behind stucco finishes or basement walls).  We can give these details to you in one simple inspection. We use an Infrared Camera to detect these problem areas in any building.

 

We also want to remind you that when it comes to Wood Burning Appliances, we are also W.E.T.T. Certified and are able to verify if any existing wood burning appliance conforms to the requirements of the (O.B.C.) Ontario Building Code.

 

Canadian Home Inspection Services Inc. provides inspections on:

 

• residential PROPERTIES
• commercial PROPERTIES
• TARION – New HomeS 
• WOOD BURNING APPLIANCES – (W.e.t.t.)
• Septic SystemS
• uREA fORMALDEHYDE fOAM – (u.f.f.i.)

 

Our inspector is a Registered Home Inspector (RHI) with the Ontario Association of Home Inspectors, as well as a Construction Engineering Technologist (CET).  OAHI is a chapter of the Canadian Association of Home & Property Inspectors (CAHPI).

 

We are sending you some information that you will find both beneficial and informative regarding different kinds of attic insulation. We always give your clients a thorough written report on site, at the completion of the inspection. Customer satisfaction means referrals for you.  By working together to ensure your client’s peace of mind, we can look forward to a very rewarding future. 

 

Call us if you have any questions or want to book an inspection.  For the Niagara Region call

905-356-1141, Hamilton Region call 905-572-1116 and our staff will be happy to assist you.

Sincerely,                                                                   

 

Tom Vattovaz, President

Registered Home Inspector (R.H.I.)

Construction Engineering Technician & Technologist (C.E.T.T.)

Septic Sewer Inspections

Wood Energy Technical Training (W.E.T.T.)

Q&A with Peter Gibson

Peter Gibson is the managing director, portfolio strategy and quantitative research at CIBC. He is considered one of the best quantitative research strategists in the country, having made good calls in the past while employed at Desjardin Securities Inc. and Scotia Capital Inc.

Mr. Gibson made the right call in 2001, that the greenback would be massively devalued over the next few years, at the same time as interest rates fell. It was a prediction that bucked economic theory, but was accurate.

In early 2007, Mr. Gibson predicted that the easy money in the equities market had already been made and forecast major corrections due to shock to the financial system. Three months ago, he created a bond volatility index and began measuring the spread between it and the stock market index.

And what does a quant man do in his spare time? While growing up in Port Credit, Ont., Mr. Gibson dreamed of travelling in space. While he applied his science training to the business world, he is still pursuing his first love: In 1997, he paid $175,000 to book one of the first rides on Richard Branson’s SpaceShipTwo suborbital ship to fly to the stars. He travelled to Philadelphia’s National AeroSpace Training and Research Center to train. The trip is still pending.

Q. Let’s look into your crystal ball. Six months down the road, what do you see happening in the economy?

A. My view is that the economy will show further signs of improvement, very much like the years 1979, 1989, 1999, when there was economic recovery after the crisis. As the outlook improves again, people feel better about the economy, but then they will start worrying about inflation again. That’s problematic because nowadays it only takes a little worrying to push bond yields up.

Q. What is the tipping point when higher bond rates will trigger another change in the economy?

A. Somewhere between 4.3% to 4.6%.

Q. When do you predict that will happen?

A. I don’t like to put a calendar date on it, but probably close to the third quarter or year end of 2010, the bond yield will have pushed up to its ceiling and the Federal Reserve will respond by tightening its bias. At that point, the change in tone from the Fed might cause the dollar to strengthen and gold to sell off temporarily. This will be an important development, because the Chinese will have to look at the implications for their market.

Q. So what’s driving all this is an emotional response from consumers?

A. Yes. Whenever the economy is growing, the bond market very quickly gets back to fretting about inflation, and that’s where the psychological aspect comes into play. It’s a misplaced fear. I’d argue that the real risk is deflation not inflation. There is no evidence companies are able to pass on price increases, in any sector, anywhere in the world.

Q. Who is worrying?

A. It’s not the guy on the street worrying about inflation, unless his wages don’t keep up. Rather, it’s the bond market, which is so large. You are talking trillions and trillions of dollars of government debt. If even 20% of the bond market started to panic about inflation, they won’t sit around and wait for evidence of deflation. They will start to sell their treasuries quickly, because any time real inflation rises it cuts into the real returns for bonds. Imagine what would happen if $2-trillion of debt was being sold — bond yields would rise rapidly because of fear the selloff would destabilize the economy.

Q. So the volatility in the stock market is directly linked to the debt?

A. Absolutely. A small amount of inflation can cause the bond yield to rise sharply, and since bond yields and stock prices are positively correlated, that’s why volatility is suddenly coming into the stock market.

Q. So what do you tell investors?

A. We favour equities until the bond yields push higher. In Canada, the improvement in financial [stocks] will be muted. I’d be more focused on commodities until the bond yield rises.But investors today have to have a good grasp of the macro-fundamentals. I predict that 70% to 80% of future price moves in the stock market will not be due to stock fundamentals but to changes in the bond yield. Recently, stocks with poor fundamentals have done better than stocks with good fundamentals. That’s what makes an environment like this so difficult for investors.

Q. What sectors will see the biggest impact?

A. The same forces that will drive the bond yield up later next year will cause gold prices to reverse and perhaps even oil prices to reverse as the Chinese economy slows down dramatically.

Q. You predict a crisis in China. Can you explain?

A. The global crisis caused a collapse in exports and forced China to prop up its domestic growth through massive stimulus. In the first several months, China put in about $1-trillion worth of lending, and that lending quickly found its way into another round of asset inflation. A real estate bubble if you like. The day when the bond yield starts to move again, it will probably cause the real estate crisis in China to start unwinding and probably affect the banking sector as well. If China is experiencing a banking crisis through the earlier part of the next decade, that will probably help keep capital in the U.S. treasury market and help protect the U.S. economy from a significant slow down. We’ll probably see a stock market selloff in 2011-2012, but it might not be as bad as it would have been otherwise.

 

by

Karen Mazurkewich, Financial Post 

 

The Canadian Press

Canada’s real estate market didn’t fall as hard or fast as in the U.S., but some spots did suffer steep losses and a recovery will be slow as buyers worry about another potential economic dip, a new report suggests.

Total losses in value across Canada will average between 10 to 20 per cent compared to the highs of two years ago, according to the study by PricewaterhouseCoopers and the Urban Land Institute.

But some areas saw a much deeper drop. The report released Wednesday predicts a slow recovery to begin by the end of next year.

“For 2010, we are rating only fair investment outlooks for most property types and predict generally weak conditions for development,” said Chris Potter of PricewaterhouseCoopers.

“Limp demand threatens to soften property cash flows across all sectors and most markets.”

The report is based on surveys of more than 900 real estate developers, lenders, brokers and consultants in both Canada and the U.S.

It shows Canadian industry is still worried about suffering more economic shocks, particularly from the U.S. financial system.

That is despite conservative banking practices in Canada and stricter regulation that saved many Canadian investors from overleveraging during the recent housing recession.

The report forecasts a relatively stable market for developments such as condos, hotels and other developments, which will favour buyers over sellers.

The report says the prospects for apartment investments rank barely above a fair rating at 5.44 out of 10, followed by office at 5.04, retail at five, industrial/distribution at 4.68 and hotels at 3.69.

“We expect to see developers curbing their activity in light of softened demand as bankers rein in construction loans,” said Lori-Ann Beausoleil, also of PricewaterhouseCoopers.

She said certain condo projects will likely “stall out” until residential prices firm up in Vancouver and Toronto.

Beausoleil said Canadian office markets performed better than expected, with vacancies averaging about eight per cent, with rates much higher in cities such as Calgary where demand remains weak.

 

 

 

by

Sharon Linwood, AMP

Dominon Lending Centres

www.SharonLinwood.ca