Grateful for my time with MPC

By Mark Kerzner, President, TMG The Mortgage Group

I believe in the power of reflection – looking back as objectively as possible to evaluate an outcome and take the lessons from past experiences so they can be applied to the future.  As I conclude my time as Director of Ontario, and Executive Member of the Board of Directors of Mortgage Professionals Canada – it is time for just such a reflection.

 When I ran for the Board of Directors of CAAMP (now Mortgage Professionals Canada) in 2014 I felt as though our industry was splintering. To me, there was a divide (brokers vs lenders/suppliers).  This is what I wrote then as part of my campaign:

It seems there has been considerable chatter lately about the role of CAAMP, regional associations and the overlap between them. Questions around the need for a national association coupled with discussions about a brokers only association have also been on the table. This is healthy dialogue and I am pleased to see the level of engagement about how we are being represented in our industry.

To that end, I would like to take this opportunity to tell you the three key reasons why I continue to advocate for CAAMP:

1.     I welcome the fact that our association is inclusive of brokers, lenders and suppliers alike. I feel that mix actually makes our voice stronger with the folks we are lobbying in Ottawa.

2.     The fact that we share a board of directors to oversee this national association helps unify our day-to-day business interests.

3.     The majority of members are aligned in seeking a very strong and growing broker channel in Canada. 

I went on to say:

CAAMP has to be more responsive and approachable. It has to advocate the broker channel while improving its events and symposiums.  More than anything, CAAMP has to remain the pre-eminent source to government and the media with respect to all-things-mortgages.

Four years later I am very proud of what we have accomplished but wish we could have done more.

Time is often marked through events and  there has been no shortage of industry benchmarks these past four years.

No one really could have predicted the extent and the resulting magnitude of the regulatory changes introduced starting in the Fall of 2016. Those changes came on the heels of a newly elected Federal Government and new staffing leadership at the Association.

I feel honoured that I have represented our members with Government, Policy Makers and Regulators. I am grateful to the Board volunteers who have given selflessly of their time and in doing so set aside personal considerations for the betterment of the Association and membership as a whole.

I believe that your Association is the pre-eminent source of information to Government and Regulators of all things mortgage related.  Our Association has taken great strides in improving events and overall value to members.

The national Mortgage Forum conference has been a resounding success the last few years and I suspect this year will be no different.

We have brought regional symposiums to new markets, delivered member updates in smaller communities, introduced additional training days and held very successful National and Provincial Hill Days.

In Alberta we have combined efforts to bring to our members and sponsors inclusive and valuable events with streamlined efforts and cost savings.  We have also collaborated and coordinated GR and advocacy efforts.

In Quebec we have grown membership to record levels and have had an average of 450 brokers attend the regional symposium in the last three years.

I am proud of what we are accomplishing – and because of these accomplishments, I am confident we can do more. To do so we need to encourage those on the sidelines to join. The value to your industry is already evident. To have a not-for-profit, industry voice that advocates for brokers is vital. Whether you are a member or not, you benefit from that voice.

The $255 annual membership fee is a tax deduction leaving the net out of pocket cost even less. Even if you see no value in the networking events, conferences, education, surveys, communications, etc… voices do matter. To powerfully advocate on your behalf with Ottawa, the provinces, the regulators and other industry associations we need to count you among us. Please consider joining – not because of the value you seek (which there is much) but because of what you can give back to your industry.

I have much faith in the leadership of the staff and the Board going forward. The Association is in very strong and capable hands. I wish them continued success.

A few final remarks:

Thank you Ron Swift and Jim Murphy for encouraging me to run.

Thank you Michael Ellenzweig, Hali Standlund, Boris Bozic and Paul Grewal for your mentorship over the years. Your respect of the brokerage channel and dedication to the Association set the bar very high for me to strive towards.

Thank you to Dan Putnam, Jared Dreyer and Lionel Lewko for leading the Board during my terms and for providing me an opportunity to contribute along the way.

Thank you to Claude Girard, Elaine Taylor, Mike Wolfe, Michael Cameron for serving alongside me on the Executive. I appreciate the discussion and debates we had but more than anything admire your leadership and commitment to the industry. 

Thank you to Cara Shulman for making sure the face of the Association is reflected in a professional and meaningful way.

Samir Asusa – thank you! Your leadership during the transition of CEOs was truly remarkable. You are smart, straightforward and empathetic. I feel fortunate to have had this time to work together.

One of the truly remarkable story lines of our industry these past few years has been Paul Taylor. Having come from a completely different industry Paul has led the Association through three different Boards, enhanced focus on Government Relations, and provided calming leadership to members across the country. He is a wonderful colleague and friend.

Thank you to all the Board members and dedicated staff I have had the pleasure of serving with over the past 4 years.

Thank you to my wonderful, supportive and inspiring wife and family. Your sacrifices these past few years allowed me an opportunity to follow my passion.

One last thank you – to my work family at TMG The Mortgage Group. You inspire me every day to give back. Your strength and leadership enabled me to participate in the Association fully. I feel fortunate to work alongside you.

One past reflection:

I remember the first CIMBL (predecessor of CAAMP) conference I attended nearly 20 years ago. As a newly minted mortgage executive I recall the excitement, enthusiasm and sense of learning I felt.  I knew at that moment that this was a very special industry and an association I looked up to. It was a place where seasoned mortgage professionals would come together, share best practices and chart a course for the future.

I continue to feel that same excitement and enthusiasm today.

5 Tips for Success

By Mark Kerzner, President TMG The Mortgage Group

A colleague asked me recently if I could share a couple of things that I do each week that helps me to be successful.  I often look to others for inspiration so I was quite flattered to be asked this question myself.

I thought about it for a bit and below is what I shared.

Below are some key fundamentals that govern who I am and how I see myself.

1.     Honour time commitments. Know what’s in your calendar, leave enough time to get to next meeting, and don’t double book.

It may not seem like a big deal if you are 10 or 15 minutes late for a meeting or a call, but trust me when I say, that’s not the case. The other person (people) are literally waiting and starting to wonder what else they could be doing with this time. They may begin to feel that they simply don’t matter or they may also have other commitments. Cancelling at the 11^th hour can be equally as annoying.

2.     Honour your time commitments with family. If you say you will be home for dinner at 6:30 p.m. be home. It adds a lot of stress to both your family and business when you don’t meet those commitments.

Just like a business meeting that begins late, when family takes a back seat to your clock you run the risk of setting off a negative chain of events and resentment at home. We have all heard that time is precious (and it is) but it’s also limited. Often we have drives, school plays, teacher meetings, etc. that also need our attention and commitment.

This doesn’t mean you have to be home for every dinner or attend absolutely every school event. It just means that when you say you are going to be there, make sure you are.

3.     Don’t TRY.  Try is really a useless word. Either you will or you will not.

When you say you will ‘try’ you are building in an excuse right from the get go. Going back to the concept of commitment -- commit one way or the other … if you cannot do something don’t say you will ‘try’ and then don’t do it.

4.     Do something creative/fun each week.

I really enjoy hockey, coaching and watching my children perform (dance). It helps me to turn off from the office for a few hours a couple times each week. Find your passion and take the time to make it happen.

5.     Be driven by your work passion.

Just like we need to find our personal passions we need to do the same thing at work. Considering we spend 40 or 50 or 60 plus hours each week on our business, find those aspects of your work that you really love. I think I have the greatest job in the industry. I get to work with talented, committed and passionate people every day who strive to put Canadians in financial situations to enable them to own homes and set them up for success. I am truly humbled that I have been able to represent my industry colleagues with Government, Regulators and the Media and I do not take that responsibility lightly. When you love what you do, you stop counting the hours.

The truth is that we all find inspiration in different places. I wanted to share my experience and encourage you to find your own, and then share that as well.

What the TREB ruling means for you

Ever wondered what that house across the street sold for? That information was only available to you through a Realtor, but not anymore. The recent ruling by the Supreme Court of Canada, refusing to hear an appeal from the Toronto Real Estate Board (TREB), over access to real estate data, will have repercussions across the country.

For years, TREB, a private organization restricted access to its home sales pricing data, although it was readily available to consumers through a Realtor.

For seven years, TREB fought against the federal Competition Bureau, with TREB insisting that publishing sales and other market data online violated client privacy and its own copyright over the information.

For many consumers and Realtor members, the ruling was a win for full transparency rather than for a loss of privacy. 

Commissioner of Competition, Matthew Boswell, said in a statement, “The ruling is “a decisive victory for competition, innovation and for consumers. The removal of TREB’s “anti-competitive” restrictions will give homebuyers and sellers “greater access to information and innovative real estate services when making one of the most significant financial decisions of their lives.”

There is the argument that releasing this data will negatively impact the market. However, there are two examples that counter this argument; when the US real estate housing market started releasing this data, the industry grew. And, there was a time in Canada when stocks and bond data was private and when it started to release its data, the industry grew and flourished.

TREB continues to argue that financial information about selling prices is a privacy issue. While they consider their next steps, let’s take a look at what the fallout will mean for both buyers and sellers.

The Toronto Real Estate Board is the largest board across Canada. It won’t be a surprise if other board follow their lead and start releasing sales data. Remember, consumers already had access to the data through their Realtor.

For Buyers

Knowing the asking price is only one factor – it’s the selling price that’s most important. Knowing selling prices will give buyers a better idea of the value of the home they want to buy. This could result in sellers listing their homes closer to the average selling price.

For Sellers

Transparency allows buyers to properly assess the value of their own homes without relying on the real estate agent.  Buyers can then make better pricing decisions if, for example, they want a quick sale. 

Overall, access to housing history and data puts the power into the hands of consumers. We could also see a lowering of prices in hot areas such as Toronto and Vancouver as consumers become more empowered.

The truth of the matter is that Realtors, similar to mortgage brokers, have their value rooted in their ability to educate the consumer and various options – that their jobs are about service. Data is not the product, service is.

Full transparency is good for consumers  and sustains a healthy, robust real estate market.

Interest rate increase has winners

Believe it or not, the recent .25% rise in the prime interest rate is an indicator of a healthy economy. Despite trade tensions, Canada’s economy looks to be weathering the tariff storm well, for now.

There is no doubt the Canadian economy is resilient. The country has weathered a few storms since 2008, but still chugs on – somewhat flat at times, but never stagnant. The focus of the Bank of Canada (BoC) is on stimulating the economy and keeping inflation in check. The inflation rate has been inching up and is now at 2.2%, still well within the Bank’s comfort zone. Maintaining low, stable and predictable inflation is key to fostering an environment where Canadians can prosper. 

There are many factors that contribute to rising interest rates. Since the economy has been in recovery mode for a while, it now makes sense the BoC would start raising the rate, given a few economic indicators.

One of the main indicators that point to a continued healthy economy is the job numbers. Without jobs, household budgets get tighter, consumer purchases slow down, manufacturers scramble to reduce inventory, which could lead to lay-offs, and bankruptcies rise. And job loss is also the leading cause of mortgage default.

In June, the economy added 31,800 positions. At the same time the unemployment rate rose to 6%, from 5.8% in May. The higher jobless rate is considered a good sign by analysts who see it as more people optimistic about finding a job.  Average hourly wage growth has maintained the same level as last month at 3.6%. 

What we don’t know is the effect of NAFTA negotiations and how an extended trade war will affect the economy. What we do know is how the recent increase will impact Canadians in the short term. 

First, the cost of borrowing will increase for customers with variable-rate loans and mortgages, but those with money in savings accounts and guaranteed investment certificates will benefit. When interest rates are low, there’s less motivation to save. 

The rate hike may also make Canadians think twice before adding to their debt loads. Canadians are carrying a record amount of debt -- $1.8 trillion and growing -- because of low interest rates. Hopefully, as rates rise, consumers will reconsider adding to their debt loads.

Seniors and retirees also benefit from rising rates. Seniors now have the opportunity to generate higher interest income, which may help them manage rising costs.

With people living longer, those with pension plans are in a better financial position against running out of money. 

The housing market is cooling a bit because of the new rules introduced this year, which may help affordability for future homeowners as the pressure to bring prices down grows. We are not seeing this happen yet in strong urban markets like Toronto and Vancouver.

There’s a fine line between interest rates that are too high or too low and how they may help one segment of our population and hurt another. 

While we have no control over interest rates, we do have control over our responses by thinking more carefully about our finances – our savings and our borrowing – so we’re not caught in challenging situations, no matter what the rates do.

Quebec government takes action with additional funding for children’s breakfasts

Quebec school boards will be receiving additional funding to serve breakfasts in all primary schools located in disadvantaged communities as part of the Quebec government’s Educational Services Strategy.

The additional funding expands the current school meal program and ensures that a greater number of children have an equal chance at success.  The initiative, championed by Breakfast Club of Canada, also recognizes the importance of a healthy breakfast in fostering academic performance.

"This is a big day for the Club and the partners, contributors and numerous donors who have been speaking up, and stepping up, for 23 years,” said Daniel Germain, President and Founder of Breakfast Club of Canada. "We greet this announcement with great pride and enthusiasm.” 

Already active in 312 schools in Quebec and capitalizing on the expertise gained over the past 23 years, Breakfast Club of Canada is eager to work with the school communities that choose to partner with the Club to implement breakfast programs in more than 400 new schools. And the Club is ready to accommodate the additional demand. 

Debbie Thomas is equally as pleased about this announcement, and is proud of the ongoing support from TMG brokers who contribute to the Breakfast Club of Canada each year. 

"Not only are we proud of the funds that we have raised to ensure more children in Canada have the opportunity to begin their day with a nutritious breakfast, but of the way our brokers and staff have gotten involved in local communities across the country, raising awareness and volunteering in the schools directly,” she said. "Since we started TMG has raised over $250,000 – that’s over 250,000 healthy breakfasts served to hungry children.”

Breakfast Club of Canada’s core philosophy is that children deserve to start the school day with a nutritious breakfast in an inclusive, caring environment. Over the years, the Club has helped shed light on the positive impacts and outcomes of school meal programs. 

"We would like to express our heartfelt thanks to all those who have supported and continue to support Breakfast Club of Canada,” added Mr. Germain. "Their commitment has made a difference for hundreds of thousands of children across Quebec. But neither the public sector nor the private sector can win this fight alone. By joining forces today and tomorrow, we will be giving kids the best possible shot at success and helping them live up to their full potential. Together, we can make it happen.” 

Housing affordability continues to erode

New mortgage rules, rising interest rates, and stress tests have definitely cooled housing market activity by making it more challenging for some to qualify for mortgage. An unwelcome consequence continues to be eroding affordability -- as sales activity slows down, house prices have continued to go up, and not only in major urban centres. 

In the first quarter of 2018, home affordability eroded further at the national level – the 11th straight quarter of declines, according to a report by the National Bank. The bank measures affordability as the mortgage payment on a median-priced home as a percentage of median income. Last quarter, the metric rose by 1.2 points in Canada. The higher the metric, the worse the housing affordability.

The bank also suggests that as interest rates rise, affordability will continue to decline, setting the stage where prices have nowhere to go but down. But when? And will it be too late?

The National Bank report also says that by the end of 2019, prices would need to fall 2% in Toronto and Vancouver to keep home affordability from eroding further.

Economists have been predicting a more stable, balanced economy where people are happily working and are able to pay their debts; where interest rates are “low normal” and where house prices are affordable.  Well, that was a few years ago. The once booming real estate sector is in a bit of a slump. 

The Canadian Real Estate Association (CREA) reported that national home sales on the MLS were down 2.9% in April 2018, to the lowest level in more than five years. About 60% of all local housing markets reported fewer sales.

According to Will Dunning, Chief Economist, Mortgage Professionals Canada, data for the first quarter of 2018 points to a sharp slowdown. For the first quarter, the sales rate was 10.3% slower than in 2017. The average price in Canada was $482,782– a 4.8% drop compared to a year ago. However, when we look at the price index as opposed to averages, which can be easily skewed, Dunning reports a different picture.

The index from CREA shows that in the first quarter of 2018 prices were 6.4% higher compared to a year ago. The index from Teranet/National Bank shows a rise of 7.6%. Price growth is strongly influenced by the balance between supply and demand, which can be measured using the sales-to-new-listings ratio. The data from CREA indicates that the ratio was 56.6% in the first quarter. Based on that ratio, Dunning expects house price growth in many areas of Canada, which is what is indeed happening.

We are living in strange times. World economies have changed; NAFTA is at risk and our economy might start to feel the effects of a trade war with the US. The new mortgage-insurance rules and stress test have indeed impacted the market, especially for the first-time homebuyers.

In an April 2018 survey by West Coast Capital Savings, 60% of young British Columbians (18 to 29 years old) believe it’s impossible to buy a house in the province’s pricey real estate market and are “seriously considering” moving to areas where home ownership is less costly.

While some homebuyers can adjust their housing expectations and move to buy something less expensive, some potential buyers will be knocked out of the market. And will there be enough, good inventory available for purchase?

There is no arguing that the market has cooled, but it has not stopped. We have not yet heard of massive foreclosures, which mean that households continue to pay their mortgages and their debts. 

So, the big question is when will prices really start coming down in a way that will make housing affordable again. 

We need to continue to closely watch the market to determine if rising rates and lower home values are a blip or a trend which will ultimately impact long term affordability for Canadians.

NU Stream Realty Inc and NU Stream Mortgage Inc chooses TMG The Mortgage Group

Wells Peng, Dan Pultr (TMG) and Anna Zhang

TMG The Mortgage Group is proud to announce a strategic affiliation with NU Stream Realty Inc and NU Stream Mortgage Inc located in B.C.

NU Stream was searching for a partner with similar values to help facilitate its incredible growth, while at the same time servicing their clients with the best mortgage products in the market.

“When we were looking at this next stage of growth, TMG’s support systems, training and tools impressed us,” said Wells Peng, founder and CEO of NU Stream.  “The TMG team is the best fit for our company and we look forward to continuing to grow together.”

TMG’s Vice-President of BC, Dan Pultr, is equally as enthusiastic.  “From the moment we met with the partners at NU Stream, we were excited to work with such growth and client focused individuals,” he said. “The company’s market penetration over the past few years has been impressive -- $3B in transactions since inception in 2016 – and when they shared their vision, it was a natural fit. “

“TMG has earned a stellar reputation in the industry because our staff, systems and resources are placed against the filter of adding value to our broker partners. We’re confident TMG will truly complement NU Stream’s business and make this partnership a win-win,” Pultr added.

TMG The Mortgage Group is an award-winning mortgage brokerage and the largest independent brokerage in Canada with more than 800 agents and brokers across the country.

NU Stream Realty Inc. is an innovative real estate brokerage company using a team-based model that has proven to be highly efficient, professional, and comprehensive. NU Stream Realty Inc. is developing operations in both the Vancouver and Toronto Chinese markets simultaneously, establishing a platform to serve customers across Canada.