Newbie BC Mortgage Brokers go part-time as purchases slow

_{By Vernon Clement Jones}

The number of mortgage brokers taking a second job outside the mortgage biz is on the upswing, say seasoned professionals, as the competition for a falling number of originations heats up and newbies find themselves without the established portfolios needed to grow referrals and refinances.

“A lot of people looked at broking in the last boom as very lucrative and they entered the market thinking that the money was always just going to flow in,” Luisa Hough, owner/broker of Exclusive Mortgage Professionals in Surrey, told MortgageBrokerNews.ca. “The market has now slowed, and it hasn’t worked out for them and they find themselves in a tough situation.”

A number of those relatively new entrants are now seeking part-time employment outside of brokering, a survival strategy meant to make up for the falling number of new purchases in the Vancouver area, according to several seasoned professionals. Some are pegging the attrition rate at as high as 7 per cent to 9 per cent of the more than 100 mortgage professionals who entered the market after 2008, when sales clawed their way up to 35,669 — a 44.8 per cent increase from the previous year’s recession-battered performance. The change in fortune led to what many brokers are now calling a super-saturated market of mortgage professionals.

Those new agents are largely without the deep client portfolios more experienced brokers are actively drawing on for refinances, second mortgages and other secondary transactions. They’re not prepared to leave the business entirely, pinning hopes on the return to a more-active market as the B.C. economy capitalizes on increased global demand for its natural resources.

But any strategy that would turn to brokering part time may be problematic, said another brokerage head working the Lower Mainland.

“It’s very common: working part-time,” Trish Pigott, of Verico Primex Mortgages in Coquitlam,  told MortgageBrokerNews.ca. “But as a broker in this market, you have to be on the top of your game. If you’re starting to look for work in another area, you’re not spending the time to keep on top of industry trends and the market or investing the time to grow your business. I don’t know that you can adequately serve clients.”

Both she and Hough are suggesting new brokers thinking about part-time work outside the field first seek out mentoring as a way of gaining the kind of guidance necessary to weather a slower sales market.

“There are opportunities out there,” said Hough. “I’ve been in this business for eight years and every day I’m out there looking to see how I can get business. That’s how this business works.”

Lower inflation in February likely to keep interest rates low

Canada’s annual inflation rate fell slightly in February, giving the Bank of Canada room to keep interest rates low over the next few months, economists say.

Statistics Canada said Friday its consumer price index edged down one-tenth of a point to 2.2 per cent in February, with rising energy and gas prices keeping inflation just above the Bank of Canada’s ideal two per cent target.

The core inflation rate, which excludes volatile items such as gas and food, fell to 0.9 per cent — its lowest level since the government started keeping records in 1984. Economists had predicted an annual core rate of 1.1 per cent and annual inflation to remain at the January level of 2.3 per cent.

It all means the country’s central bank might take its time when it comes to raising interest rates, said CIBC World Markets economist Emanuella Enenajor.

“These (inflation) numbers certainly make it less likely that a May rate hike could happen, we do have to admit,” she said.

“Such a soft core number suggests there’s less pressure for the Bank of Canada to really start hiking rates aggressively so it gives it a little more leeway.”

She said CIBC is for now sticking with its prediction that Canadians will see rates go above the current one per cent in May and that they will end up at two per cent by the end of the year.

Canada’s economic growth surpassed expectations in the last half of 2010 and the Bank of Canada may want to get ahead of any resulting spike in prices by raising interest rates and cooling lending conditions, she said.

Doug Porter, deputy chief economist at BMO Capital Markets said he believes the central is likely to stick with lower rates for the short term.

“Both headline and core inflation have eased since the start of the year, at least partly thanks to the lofty loonie,” he wrote in a note to investors, pointing out that Canada’s core inflation rate is lower than that of the U.S. and rest of the world.

“This is set to reverse next month, as Canada gets with the global program, but the low starting point is very favourable. Suffice it to say that this keeps the pressure well off the Bank of Canada to get back in tightening mode any time soon.”

Enenajor said the March inflation rate will likely depend on oil price movement during the rest of the month.

“However, expect both the annual headline and core rate to move higher in March on a year-on-year basis,” she said.

Prices were higher in February in six of the eight major categories tracked by the agency, but items like women’s clothing, footwear and travel tours cost less than a year earlier.

On a month-to-month basis, consumer goods were 0.3 per cent more expensive last month than in January, mostly due to higher energy and gasoline prices. Canadians paid 10.6 per cent more for energy during the year leading up to February, after posting a nine per cent increase in January.

Gas prices soared 15.7 per cent last month, on top of the already recorded 13 per cent increase in the 12 months leading up to January.

On a regional basis, Nova Scotia remained the province with the highest inflation rate at 3.4 per cent. Many people in that province use oil and other fuel to heat their homes.

Alberta continued to enjoy the most stable prices, with an inflation rate of 1.2 per cent.

Drivers in every province except Manitoba faced double-digit price increases for gasoline on a year-over-year basis. The price at the pumps was up 15.7 per cent from a year earlier.

The Canadian Press

OTTAWA
– The Bank of Canada today announced that it is maintaining its target for
the overnight rate at 1 per cent. The Bank Rate is correspondingly 1
1/4 per cent and the deposit rate is 3/4 per cent.

The global economic recovery is proceeding largely as expected, although
risks have increased.  As anticipated, private domestic demand in the
United States is picking up slowly, while growth in emerging-market
economies has begun to ease to a more sustainable, but still robust, pace.
In Europe, recent data have been consistent with a modest recovery. At
the same time, there is an increased risk that sovereign debt concerns
in several countries could trigger renewed strains in global financial
markets.

The recovery in Canada is proceeding at a moderate pace, although
economic activity in the second half of 2010 appears slightly weaker
than the Bank projected in its October Monetary Policy Report. In the
third quarter, household spending was stronger than the Bank had anticipated
and growth in business investment was robust. However, net exports were
weaker than projected and continued to exert a significant drag on
growth. This underlines a previously identified risk that a combination
of disappointing productivity performance and persistent strength in
the Canadian dollar could dampen the expected recovery of net exports.

Inflation dynamics in Canada have been broadly in line with the Bank’s
expectations and the underlying pressures affecting prices remain
largely unchanged.

Reflecting all of these factors, the Bank has decided to maintain the
target for the overnight rate at 1 per cent. This leaves considerable
monetary stimulus in place, consistent with achieving the 2 per cent
inflation target in an environment of significant excess supply in Canada.
Any further reduction in monetary policy stimulus would need to be
carefully considered.

Information note: The next scheduled date for announcing the
overnight rate target is 18 January 2011. A full update of the Bank’s
outlook for the economy and inflation, including risks to the projection, will
be published in the Monetary Policy Report on 19 January 2011.

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By
Julian Beltrame

OTTAWA — North American consumers are showing signs of emerging from
hibernation in time for Christmas, pushing up inflation in Canada to a new
two-year high and improving growth prospects for both economies.

Canada’s inflation rate rose a surprising half-point to 2.5 per cent in
October, a sign the economy is not facing the imminent risk of a deflationary
slump.

In conjunction with price firmness, Statistics Canada also reported Tuesday
that retail sales jumped 0.6 per cent in September as consumers bought more cars
and spent more on sporting goods, clothing, books and music.

The strength of the consumer was also evident south of the border, where the
third-quarter gross domestic product was revised to 2.5 per cent from a
previously reported two per cent.

The three data points are positive indicators for the North American economy
— which had been under pressure over the past few months — and for retailers
with Christmas shopping season approaching, said Douglas Porter, deputy chief
economist with BMO Capital Markets.

“Today’s numbers do suggest the economy had a little more underlying
momentum than previously believed,” he said. “The consumer spending numbers
are not rock-and-sock’em, but they are solid.”

TD Bank’s chief economist Craig Alexander also doubted the better consumer
spending data signalled a return to “booming” sales, saying the increase
should be kept in context.

But the improvement was welcomed in Canada given recent soft data in other
sectors of the economy, particularly manufacturing, exports, housing and
employment.

Analysts were bracing for a potential drop in gross domestic product in
September, but the retail numbers now suggest the month will come in positive.

And analysts now think Canada’s third quarter will see the economy
advancing at about 1.5 per cent, below the two per cent growth of the second
quarter but in line with the Bank of Canada’s expectations.

While that is one percentage point less than the U.S., CIBC chief economist
Avery Shenfeld cautioned Canadians against making the comparison, since the
American economy is starting from a much deeper hole.

“We have not had as deep a disinflationary trend as the U.S. and that’s a
sign we’re not as many miles below full employment as the U.S.,” he said.

“They have a lot more catching up to do,” he added.

The key difference, say analysts, is that while Canada has recouped all the
jobs lost during the 2008-09 recession, the U.S. has only brought back about 15
per cent of the almost nine million jobs that vanished.

Still, nothing in Tuesday’s numbers changes the established picture that
the recovery will continue to be a long, arduous slog before the conditions
return to the robust growth and strong job creation levels that existed prior to
the crisis.

“Given all the concerns that continue to swirl around the global economy, I
don’t think we should let down our guard just yet,” Porter said.

Analysts said it is unlikely the one-month consumer price jump will scare
Bank of Canada governor Mark Carney into raising
interest rates in the near future, in part because inflation is expected to
moderate.

Breaking down the numbers, Statistics Canada said higher energy costs were
responsible for about half of the inflation increase, but most things were
noticeably higher in October.

Transportation costs rose 4.6 per cent, while shelter costs increased 2.8 per
cent. Other gains included food, up 2.2 per cent, electricity 8.1 per cent, cars
4.9 per cent, car insurance 4.6 per cent, and property taxes by 3.5 per cent.

There were still some bargains, however. Clothing and footwear edged down 0.1
per cent from last year, mortgage interest costs retreated by three per cent,
the price of computer equipment and supplies dropped 12.5 per cent, and air
transportation and furniture were also lower.

Regionally, the two harmonized sales tax provinces continued to have among
the highest inflation rates in the country, with Ontario leading the way at 3.4
per cent, half-a-point higher than in September, and British Columbia at 2.4 per
cent.

The Canadian Press

Should you spend the money on a real estate commission or save that money by selling your home by yourself? That is a question many home sellers ask themselves. Today, we want to discuss why it is crucial to have a true professional guiding you through the minefield of challenges that exist in the current real estate market.

The housing market today is more challenging than it has ever been and seems to be becoming more difficult each day. What impact will foreclosures have on prices? Which loan products that were available just last month are no longer available? How do you convince perspective purchasers to pull the trigger on an offer when everyone is telling them that they should see another 100 houses before they make a decision? These are tough questions for a trained, experienced professional.  The lay person would find it almost impossible to keep abreast of this rapidly evolving industry.

Here are five important reasons to use a real estate professional:

1. Pricing Is Difficult

Just a few years ago, you didn’t have to worry about overpricing your home. If it was too high, all you needed to do was wait as historic appreciation was taking place. The situation is quite different today. With experts calling for another drop in home values, overpricing your property will cost you time. In this market, time costs you money. A professional real estate agent will discuss how increasing inventory could dramatically impact the value of your property in the months to come. They will help you set the right price in today’s market.

2. Negotiating Ability Is Crucial

Buyers today have an almost unlimited supply of homes from which to choose. They realize that puts them in a great negotiating position. Most buyers are now being represented by an agent. Sellers need to also be represented by a professional expert trained to negotiate real estate contracts.

3. Mortgaging Is Key to the Deal

The biggest impact of the housing market collapse is that lending standards are much stricter today than they were a few short years ago. Rules are constantly changing. Even CMHC has gone through a guidelines overhaul in the last several months. You need a real estate expert who has teamed up with a knowledgeable mortgage professional to make sure that the buyer in the deal is in fact capable of obtaining a mortgage. Losing time with an unqualified buyer costs you money in a market where prices are falling.

4. Your Family’s Safety

We have always found it puzzling that the same person that will lock every door and window and set the alarm today will then allow total strangers into their house tomorrow. The real estate industry trains its practitioners to take steps to protect themselves and their clients. Take advantage of putting a person between you and the person calling on an ad or yard sign.

5. You Probably Have More Important Things to Do

Selling a home could turn into a full time job. Learning the necessary disclosures, coordinating the dates of your closings, dealing with a challenge regarding your appraisal and re-negotiating the offer after an engineer’s report are just a few of the concerns you may face. You would probably be better of spending that time with the items important to you and your family and leaving the challenges to your agent.

Bottom Line

To make sure the sale of your home is handled professionally – hire a trained professional. In the long run, you will wind-up with more money in your pocket and have less challenges with the move.

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The broker, does not guarantee the accuracy of information such as square footage, lot size, architectural images, or other information concerning the condition or features of subject property. Information is deemed reliable, but is not guaranteed. Information may have been obtained from public records and/or other sources, and all buyers are advised to independently verify the accuracy of any and all information through personal inspection with appropriate qualified professionals.

Neighborhood Information

Kelowna’s Lower Mission extends from KLO Road to Barnaby Road and from Okanagan Lake up to Gordon Drive.

The Lower Mission has many pockets of both old and new neighborhoods and many luxurious lakefront properties along Okanagan Lake.

SHOPS:
Mission Park Shopping Mall is the main centre for shopping in the Lower Mission. Here you can find Cooper’s Foods, Save On Foods, Liquor Store, Mission Creek Wine Cellars, M&M Meats, plus many other fashion and clothing stores in Mission Park Shopping Mall.

SCHOOLS:
Anne McClymont Elementary School – Grades K-7
Dorothea Walker Elementary School – Grades K-7
Casorso Elementary School – Grades K-7 and French Emmersion)
Okanagan Mission Secondary School (OKM) – Grades 8-12

PARKS & BEACHES:
The Lower Mission is well known for it’s many fabulous beaches. Gyro Beach and Rotary Beach are the more active and busy beaches during Kelowna’s summer months. Sarsons Beach tends to attract a quieter, local crowd.

Mission Creek Greenway is a fabulous linear park that runs alongside the Mission Creek. Here you can bike, walk, jog, or bring your dog (on leash only). The trail starts right on Lakeshore Road in the lower mission and is over 17km in length.

RECREATION:
The Lower Mission has a fabulous new Aquatic Centre – “H2O”. H2O Adventure + Fitness Centre is the largest municipally owned water park in Canada and features an Olympic length 50 meter pool, wave pool, river run,
3 water slides, children’s water play area, and an ocean wave surf simulator. And, for the fitness enthusiast, a 12,000 square foot cardio and weight equipment and exercise space.

Nearby is the Capital News Centre featuring ice rinks for hockey, drop-in ice skating, fitness training, plus Boomer’s Bar & Grill.

HOTELS & RESTAURANTS:
The Hotel Eldorado and the Manteo Beach Resort are the most popular hotels in the Lower Mission.

For dining out, try the Minstrel Cafe, Cabana’s Restaurant, Wild Apple Grill (in the Manteo), or the Hotel Eldorado Dining Room.

For more casual eating the Pheasant & Quail Pub is always popular with the neighborhood crowds.

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The District of West Kelowna, formerly “Westside District Municipality,” with its 28,793 citizens, was officially incorporated on December 6, 2007. Up until that day, the area was governed by the Regional District of Central Okanagan (RDCO) and the ProvincWest Kelowna View 2e of BC and was the largest unincorporated area in the province. Three elected representatives from the Westside Electoral Area sat as directors on the 11-member RDCO board to speak for citizens on the west side of Okanagan Lake, between Peachland and the W.R. Bennett Bridge. For many years the topic of incorporating the west side of Okanagan Lake into a stand-alone municipality was discussed at RDCO and provincial tables and at the community level. Three previous attempts at incorporation occurred: one in 1974 which ended before a referendum, a 1980 referendum resulted in 87% opposing incorporation and in 1993 a Westbank-only incorporation referendum was defeated by 66%.

But the June 16, 2007 referendum decided the governance question. Taxpayers voted 84% to change from Regional District to municipal status, and 51.1% in favor of incorporation over amalgamation with the City of Kelowna. The referendum was the culmination of the work of the Westside Governance Committee, a 12-member committee with six representatives elected at a community meeting and six appointed by Westside Electoral Area directors. This core group was joined by twelve ex-officio members representing the Westside improvement districts, RDCO Directors, City of Kelowna Mayor and Council, and the Westbank First Nation Council. This valued work produced a close scrutiny of the different governance options available, presented in an 8-week public education initiative leading up to the referendum.

Four months after the referendum, area residents were participating in the first election campaign for a mayor and six councillors. On November 17, 2007 residents elected Mayor Rosalind Neis and Councillors Doug Findlater, David Knowles, Gord Milsom, Duane Ophus, Heather Pilling and Carol Zanon.

Mayor Neis and Council were inaugurated on December 6, 2007 in a ceremony attended by Hon. Ida Chong, Minister of Community Development, MLA Rick Thorpe and many dignitaries from neighbouring jurisdictions. The Letters Patent officially declared “Westside District Municipality” as an incorporated municipality.

Council set the stage for a quick transition from previous government by establishing its Strategic Plan 2008, with two key goals to be kept in mind—fiscal responsibility and public consultation.

November 2008 saw the municipality’s second election with Mayor Doug Findlater elected. Council conducted an opinion poll on the name of the community in conjunction with the Nov. 15, 2008 election of Mayor and Council. The opinion poll indicated a majority (82%) of Westside residents want a new name for the District with “West Kelowna” gaining the most support (48%).

On Dec. 9, 2008, Westside District Council approved the name “West Kelowna”

for the District and the Letters Patent were officially changed by the Province of BC January 29, 2009.

To date Council and staff have accomplished a great number of goals in the Strategic plan, moving ahead on many items sooner than expected.

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