For people who are interested in Canadian real estate, some factors which affect the sale and purchase of property has changed radically in the last few years. There have been a number of changes that people need to be aware of whether they are looking at buying and selling a residence as an investment or on a straight residential basis. Changes have taken place or are taking place in lending practices and taxation methods. Learning what these changes are can prevent you from making costly mistakes.

Some of these changes have been brought about by the CMHC. The CMHC is the ruling body that basically sets lending practices for mortgages in Canada. They provide mortgage insurance and set housing related policies. Because they provide mortgage insurance for lending institutions, if they determine that lending practices have changed, many banks will go along with the decision. There are times that this has benefited people who want to invest in homes and commercial buildings as well.

One of the programs that was very popular was the no down payment mortgage. This allowed first time property buyers to avoid finding the five percent of a property’s purchase price that was originally required. In fact, it was this lack of a down payment that allowed many people to afford their first property. Because of this, many people jumped on the purchasing band wagon and managed to finance their first property.

It led to a real estate boom in Canada. There were similar opportunities in the USA and this led to a huge increase in property sales there as well. Unfortunately, in the States, other factors such as credit history were ignored and many unsuitable individuals were allowed to purchase properties. Many of these ended up going through foreclosure and losing their properties. This is one factor that upset the economy. Therefore, to prevent the same problems from happening here, the CMHC canceled the no down payment program, something which many buyers may still be unaware of.

Another way that home buying was made more affordable was a longer time period in which to pay back the money. Usually the money to buy a home is paid back over a period of twenty or twenty-five years. This was extended and mortgages of up to forty years were available. This lowered the overall monthly payment so that people could afford a better home than otherwise would be possible. The forty year amortization period was also canceled by the CMHC in October of 2008.

The first two changes occurred on a national basis but there is a major change that will affect Ontario residents. In July, 2010, Ontario will be adopting a harmonized tax that combines two current separate taxes. This means that buying a home will suddenly cost eight percent more.

Changes to the real estate market are more profound than just a change in buying and selling conditions. Acts like the adoption of a harmonized tax and the loss of the no down mortgages are something that you need to be aware of and prepared for.

From information see the Condos in Edmonton site for more on real estate news, newproperties and buying and selling advice from Edmonton’s top Realtor.