Morning Interest Rates Headlines

• Requirements loosened for rental investors [Montreal Gazette]
  No money down if lender satisfied. Tight market in some regions prompt CMHC changes.
  “Budding real-estate moguls will welcome the news that Canada Mortgage and Housing Corp. has relaxed the rules for would-be Donald Trumps to purchase investment properties with no money down.The changes apply to rental properties with a maximum of four units, but even The Donald had to start somewhere. CMHC has made the changes with the intention of easing the squeeze in the rental housing market.”
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• More rate cuts likely says Bank of Canada [Financial Post]
  “More interest rates cuts may be necessary to buffer Canada from the impact of the U.S. economic slowdown, according to the senior deputy governor of the Bank of Canada.”
  Paul Jenkins said “the risks surrounding the Canadian economy have shifted to the downside, resulting in our decision to lower our policy interest rate by 50 basis points to 3.5%.”
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• Canadian Home Prices to Moderate, but No Danger of Meltdown, Economist Says [CEP News]
  “Declining Canadian home sales and moderating home prices could sap domestic demand, a Canadian economist is warning.
  “Canada isn’t in danger of the same sort of real estate meltdown as experienced in the U.S. or the sudden hikes in interest rates associated with subprime mortgages, he said, but Canadians still need to be careful. The disappearance of strong domestic demand would have a negative impact on the economy, he added.”
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• Longer payback loan fuels housing market [The Star.com]
  “There’s a revolution going on in Canada’s housing market, one that is propping up prices and extending the boom. More buyers are choosing mortgages with longer payback periods.
  By stretching payments over 30 to 40 years (instead of the usual 25), they can enter the market sooner or buy a better property. Mortgages with longer amortizations have caught on like a house on fire (pardon the pun).”
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• Interest rates head south - but how far? [Times Colonist]
  “Canada’s mortgage rates are heading down. At a time when stock markets are volatile and with the economy and income growth slowing, the positive news for those planning to get into the housing market or whose loans are up for renewal is that it’s going to cost less to finance a mortgage.”
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