Long-term mortgage rates rose a quarter-point Friday, but the move is not expected to put the brakes on the Lower Mainland’s hot real estate market just yet.

“It won’t have a significant impact, I don’t think,” said Rob Regan-Pollock, a mortgage broker with Invis Financial.

He noted that long-term rates are still among the lowest in decades and homeowners with variable-rate mortgages can still expect a rate cut when the Bank of Canada governors meet in mid-April.

In the local housing market “demand is still outstripping supply,” Regan-Pollock added. “I don’t think this is the beginning of the end.”

Canadian long-term mortgage rates jumped unexpectedly Friday as interest rates rose in the bond market following a strong U.S. employment report.

CIBC was first off the mark, raising rates on residential mortgages for terms of two years and longer by between 0.15 and 0.25 percentage points.

The new rates, effective Saturday, are 5.95 per cent for a five-year term and 5.35 per cent for a three-year loan, each up 0.25 point.

The Royal made a similar announcement about an hour later, nudging its 10-year rate up 0.35 point to 7.75 per cent, and other major banks followed suit with their posted rates.

Bankers finance mortgage lending in the bond market, where rates jumped Friday amid fears a rapidly expanding U.S. economy would intensify inflationary pressures.

The U.S. Labor Department reported that American employers added 308,000 jobs in March, hiring at the fastest pace in four years and more than double the rate most economists had expected.

The jobs data added to expectations that the U.S. Federal Reserve will raise short-term interest rates later this year to forestall inflation.

That prompted suggestions that homeowners with floating-rate mortgages think about locking in.

“I do expect some of our clients will be locking in,” Regan-Pollock said. And if positive economic indicators continue to come out of the U.S., they will look wise in hindsight.

However he cautioned that Friday’s rise came on the basis of a single jobs report, and even if the trend continues, inflation and interest rates usually rise gradually.

“It’s an indication that we’re probably at the low point in the cycle,” he said.

On a $200,000 mortgage, a rise of a quarter percentage point from 4.5 to 4.75 per cent would translate into an extra $28 in monthly payments, rising from $1,106 to $1,134, he said.

A CIBC economic study released Friday, meantime, suggests that low mortgage rates have been propping up more than just the real estate sector.

Canadian homeowners have pulled out $29 billion from their home equity in the past two years while saving an additional $7 billion in interest by refinancing their mortgages, the study said.

The report “identifies the real estate market as the sole champion of the current economic cycle,” the bank said in releasing the report, entitled Home Is Where the Money Is.

“Lured by historically low mortgage rates, Canadians have been refinancing their mortgages at a pace never seen before — nearly one in two mortgage holders refinanced between 2002 and 2003,” stated Benjamin Tal, senior economist at CIBC World Markets.

“A cocktail of surging home prices and falling interest rates put $36 billion of extra purchasing power in the hands of mortgage holders. This is equivalent to the annual income from one million new jobs being created.”

The study indicates Canadian homeowners who refinanced in the past two years have saved an average of $4,000 per household by obtaining a lower interest rate.

At the same time, “when mortgage holders refinance, about one in three increase their mortgage amount by an average of $28,000, leading to an $18-billion increase in total mortgages outstanding in the economy,” said Tal.

And home equity loans, growing at an annual rate of more than 25 per cent, added $11 billion to consumer spending power, he said.

CIBC estimates more than 25 per cent of those who obtained extra cash from mortgage refinancing “showed a high level of discipline, as they used the funds to pay down more costly debts,” and among lower-income households that figure rose above 50 per cent.

The study also found that over 25 per cent of households blew the extra cash on pure spending, while 25 per cent invested it in home renovations.

© The Vancouver Sun 2004

Condominium sales sizzled in March, establishing a record for the number of units sold in a single month in Greater Vancouver.

Multiple Listing Service figures released Friday show a total of 1,967 condos changed hands last month, up 60 per cent from 1,229 sales in March 2003.

The previous one-month high was 1,689 units sold in October 2003.

“Condominiums remain a very popular choice for first-time buyers and people who want the lifestyle of the urban centre,” said realtor Andrew Peck, newly elected president of the Real Estate Board of Greater Vancouver.

“Condo developments are typically located so that shopping and cultural activities, together with lots of parks and recreation, are at your doorstep.”

Including the three main housing types, last month’s residential property market in Greater Vancouver was the hottest in 13 years, with a total of 4,371 units sold, up 32.3 per cent from 3,304 sales the previous March.

In April 1991, a total of 4,094 detached homes, townhouses and condos sold on the MLS.

The 4,371 condo sales last month would include the more than 400 homes sold in one weekend by realtor Bob Rennie at the Yaletown Park residential project, being built at Homer and Smithe streets by developer Peter Wall.

Dozens of purchasers had lined up overnight outside the project’s downtown presentation centre prior to the grand opening for the first 612 units made available.

“I’ve never seen this environment before in my 28 years of selling real estate,” Rennie said. “Every crane [development] downtown is already 90 to 95 per cent sold.

“Pent-up demand is being released by the record low interest rates. It’s creating a really strong market, even when there’s virtually no inventory.”

In mid-April, Rennie is launching marketing at Tri-Power Developments’ King Edward Village, at Kingsway and Knight Street, where he already has more than 1,100 names on a reservation list vying for 202 units.

The Lower Mainland’s hot spots for condo sales in March included both Vancouver‘s west and east sides, Coquitlam and Richmond.

Last month’s average MLS condo price in Greater Vancouver was $248,600, up 17 per cent from $212,200 a year ago.

Detached houses sold at an average of $516,600 in March, a year-over-year increase of 21 per cent over $426,700. Townhouses fetched an average of $300,200, up 16.6 per cent over $257,400.

“Consumers, particularly younger first-time buyers, continue to choose home ownership as a great investment,” Peck said.

“There are a number of factors driving this market, particularly huge consumer confidence in investing in real estate. It has a proven track record.”

In the six Fraser Valley communities, MLS sales totalled 2,107 units last month, an increase of 24.3 per cent over 1,695 homes in March 2003.

Detached houses in the valley sold at an average price of $341,200, up 16 per cent from $294,100 the previous year. Townhouses averaged $209,400, up 18.2 per cent from $177,200, while condos went for an average of $129,400, up 11.5 per cent.

© The Vancouver Sun 2004

The idea of filing legal documents online makes some people nervous. After all, it would seem remarkably easy to alter an electronic document.

If you want to be paranoid about it, a few keystrokes and somebody else could own your house. A few more and who knows what could happen.

Not so, says Mark James, the corporate account manager with Adobe Canada, who worked with the Land Titles Branch on the documents for e-filing, which are in Adobe’s PDF format.

For one thing, once the lawyer or notary’s electronic signature is applied to the document, it’s figuratively frozen in time.

“Once the user signs, it puts a hidden stamp on that document that validates how that document looked at that time. We take a snapshot of that file.”

And, if the document is ever altered, the Adobe Acrobat program, which creates the PDF files, can tell if it’s been changed.

Not only that, but the reader of the document can do a rollback.

“So you can do a comparison as to how that document looked at the time it was signed and how it looks after the alteration.”

Another problem with electronic documents is that time changes technology.

A document created five years ago — because of changes in fonts and printing methods — could look completely different now both on-screen and when printed. Worse yet, if the document contained tables, key data could become misaligned.

With PDF, says James, the format gets locked in.

“So 20 years from now the document will look exactly the same, including the fonts and the graphics.”

If the document is ever sent out for review, said James, you not only know it won’t be altered but comments can be made on it without them becoming part of the document.

As well, said James, with paper documents that are examined they have to be removed from the archives holding them. This is not true of electronic documents where a copy can be made and send out and the original remains in the files.

Another company heavily involved in making e-filing work smoothly and securely in British Columbia is Vancouver‘s MacDonald Dettwiler and Associates, which operates the BC OnLine service — over which e-filing is done — in a public/private partnership with the provincial government.

Roland Knight, the COO of MDA’s information products group said that the company has worked closely with the provincial law society to make sure they were happy.

“Number one you have to make sure that the document is coming from the person you think it’s coming from, so there’s an authentication process,” Knight said.

“And you have to make sure the documents are securely transmitted, that there are no errors in transmission that people don’t have the ability to alter the document.

MDA, said Knight, built the BC OnLine system and will be operating it.

“Basically, we’re responsible for accepting the orders and the government has the responsibility for basically maintaining the data base.”

Knight said that MDA, in addition to the e-filing part of the process is working on the e-conveyancing end of things so that eventually all the documents can be prepared electronically, and information passed between banks and lawyers and notaries even before e-filing takes place.

“We’ve done a joint venture with a company called Remote Law and they have software that allows you to basically do e-conveyancing.

“Prior to this one-stop shopping wasn’t there. Now a seamless end-to-end process is possible.”

© The Vancouver Sun 2004

Heather Birchard and Kimberly Cameron examine the ‘green’ condo’s living room. CREDIT: Les Bazso, The Province

It’s the home West Coast yuppies dream about over caramel macchiatos.

The “Sustainable Condo” features hardwood floors made from salvaged wood, an indoor greenhouse for growing herbs and a dual-flush toilet to save water.

The “green” condo of the future was unveiled at the Globe 2004 eco-business show in Vancouver yesterday.

“It’s there to show consumers what the opportunities are for sustainable design to be incorporated in their lives,” said architect Peter Busby, whose firm designed the condo.

“Everything there is off the shelf and available today,” he said. “But we don’t have developers in Vancouver picking up on the idea that maybe people want a ‘green’ home.”

Among the 130 ideas packed into the condo are a washer/dryer that uses 10 per cent of the energy of a normal machine and a fridge that uses 11 per cent of the energy of a standard fridge.

“They look better, they’re nicer designed and you’re saving every month you use them,” Busby said.

There are solar panels in the bedroom that also save electricity.

The kitchen has special recycling containers under the folding workspace/table. In the bathroom, the dual-flush toilet uses three or four litres of water per use, compared with the six litres a typical toilet uses per flush. There’s also a low-flow showerhead.

“These places are healthier,” said Busby. “The carpet is so safe, you can eat it. The paints won’t give off poison that contaminates you.”

He said longtime West End residents have developed asthma from living for years in old apartment buildings with fraying carpets and poor ventilation.

“We should be building healthy environments and we know how to do that,” Busby said.

Many of these products will be featured in the city’s sustainable-condo development in southeastern False Creek and the 2010 Olympic village.

“We’re showing them, ‘Here are some examples of what you can do,'” said Busby.

While the solar panels are very expensive, condo-buyers could get most of the “green” features for two per cent more than the price of a typical condo.

“Their energy bill is going to go down by $500 a year,” he said.

“Every year it’s going to pay them back in lower operating costs.”

The sustainable condo will be on public view at this year’s Pacific National Exhibition and is also slated for Science World.

The condo will also be on view on the Internet at www.sustainablecondo.com — a website currently under construction.

© The Vancouver Province 2004

For home buyers — and sellers too — the often heart-pounding closing-day legal runaround is nearing an end. Starting today, lawyers and notaries across British Columbia can file land-registry documents electronically.

What that will mean is that, eventually — as law firms sign on to the service — there will be no need for couriers to speed around the province, racing documents to land-titles office before closing time.

And there will be no more tearing of hair and gnashing of teeth as buyers and sellers worry that properties won’t get registered and, in turn, banks won’t be able to release mortgage money.

So far, only five law firms and one notary firm, all participants in a pilot program, have done this before in B.C. A few more such firms are expected to begin e-filing today.

Coincidentally, e-filing of documents with the provincial corporate registry, using similar methods through the BC OnLine system, began on Wednesday.

What the land registry e-filing change also means, say B.C. land-titles officials, is that no matter where you are in the province — 100 Mile House or Vancouver or Port Hardy — you can have the same service.

And a house sale in Port Hardy is exactly the example Darcy Hammett, director of registry programs standards and policy with the Land Title Branch, likes to use as an example of what can happen with paper filing.

“The documents end up on the lawyer/notary’s desk,” said Hammett. “Then they prepare that transfer on their PC. They print out a copy, and get everybody to execute.

“And then it’s got to get into that courier bag and it’s got to get to the land-titles office on that day. There are panics involved in doing that and a lot of express couriers and sometimes planes.”

Home purchases and land deals have failed, said Hammett, simply because documents didn’t get to a land-titles office by 3 p.m. on closing day.

Documents now available for e-filing include freehold transfer, mortgage, general instrument charge, general instrument release, declaration and electronic payment authorization. Before e-filing, the earliest lawyers and notaries could get registry numbers phoned back to them by the Land Titles Branch was at 11 a.m.

And that sometimes meant trouble, especially in cases where a string of properties was involved, said Hammett. The lawyers have to get the next deal going as soon as they get the registry number for the first property.

“You’ve got all these things pending and the trick is to get all the financials done and the cheques exchanged by the end of the banking day.”

With e-filing — using the Adobe PDF document format and the BC OnLine service jointly operated by MacDonald Dettwiler & Associates and the provincial government — the first numbers can come back as early as 6 a.m.

This gives the lawyers and notaries plenty of time to get the process completed by the end of the day.

© The Vancouver Sun 2004