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Bank of Canada holds interest rates steady

admin — Sun, 21 Jun 2009 20:38:11 +0000

The Bank of Canada held its benchmark overnight lending rate steady at 0.25 per cent at its setting on June 4th, 2009. The trend-setting Bank rate, which is set 0.25 percentage points above the overnight lending rate, remains at 0.5 per cent.

The Bank indicated that economic and inflation outlooks are unfolding largely as it expected when it last cut its benchmark interest rate on April 21st, 2009. At that time, it forecast the Canadian economy would continue contracting until the fourth quarter of 2009. It also forecast that inflation would to climb back to the two per cent midpoint of its target range between one and three per cent in the third quarter of 2011.

The Bank also reiterated its pledge to hold interest rates at current levels until the end of the second quarter of 2010, conditional on its inflation outlook.

In April, the Bank assessed the overall risks to its inflation projection as tilted slightly to the downside. It reiterated this assessment in its interest rate announcement on June 4th.

The Bank acknowledged significant improvements in financial conditions and commodity prices, and modest recoveries for consumer and business. However, it expressed concern that these positive economic factors could be fully offset if “unprecedentedly rapid rise in the Canadian dollar proves persistent.”

The Bank’s benchmark overnight lending rate was dropped in April to what it described as “the effective lower bound for that rate.” If it needs to boost economic growth now that interest rates are as low as they can go, the Bank reiterated that it may resort to unconventional means of loosening monetary policy conditions.

The Bank’s Monetary Policy Report published on April 23rd included information about additional monetary policy tools it may use to further inject liquidity into the financial system in its ongoing attack against the continuing credit crunch.

When the Bank cut interest rates on June 4th, the advertised five-year conventional mortgage rate stood at 5.45 per cent. This is down 1.2 per cent from one year earlier, and unchanged from where it stood when the Bank made its previous interest rate announcement on April 21st.

The information contained in this report has been prepared by The Canadian Real Estate Association drawn from sources deemed to be reliable, but the accuracy and completeness of the information is not guaranteed. In providing this information, The Canadian Real Estate Association does not assume any responsibility or liability.

Source: The Canadian Real Estate Association.

Locational Factors and appraisal of property

admin — Sat, 20 Jun 2009 13:54:51 +0000

Locational factor is very important and everybody knows how it impact the real estate. Common locational factor includes such things as pattern of land within immediate area, availability of utilities, access to transportation, stores and recreation, neighbourhood overview. The existance of nearby hazards and nuisances like odour and traffic have detrimental effect. Plus thereare no such deficiencies impacting your property in value.

Corner Lots are good if the property is commercial, because of additional advertising and access. But if its a residential property the corner lot may not be desirable due more maintenance, e.g snow removal and side yard upkeep.

Mortgage – Overview

admin — Sat, 08 Nov 2008 20:30:08 +0000

According to America Heritage dictionary meaning of mortgage is;
i) A temporary, conditional pledge of property to a creditor as security for performance of an obligation or repayment of a debt.
II) A contract or deed specifying the terms of a mortgage.
III) The claim of a mortgagee upon mortgaged property.
It has been further elaborated in Canadian Real Estate Encyclopedia A mortgage is claim /encumbrance upon the real property given by the owner of the property the lender a security for money borrowed and typically registered in the applicable provincial land registration system. Borrower is known as mortgager and lender is mortgagee. Lender, for example the bank lends money and register mortgage against the property. The borrower gives mortgage as security for the loan and receives funds.