We are all enjoying a reprieve from big mortgage payments but what how do we prepare for rising mortgage rates?

Here from Peter Kinch's mail-out is a transcript of the interview between Peter Kinch and Russell Byth that aired Sunday, November 22nd on News 1130

Russ:
There's been a lot of talk this past week about the inevitable rise in interest rates and its effect on the housing market.

On the line with me is best selling author, Peter Kinch with Dominion Lending Centres. Pete, is the quick recovery and suddenly booming housing market setting us up for another fall?

Peter:
Well Russ, there's certainly that potential, but again we need to keep some perspective. Just a year ago everyone was worried about how much equity they lost and a year later the headlines show a double digit growth in prices.

Russ:
Clearly the housing market recovered faster than most expected. Do you think that was fuelled by the record low interest rates?

Peter:
Well absolutely, that's a major factor. I mean, the Bank of Canada accomplished exactly what it set out to do and that was to stimulate the economy and the housing industry represents a major component of that economy.

Russ:
So here's the question: if low rates spurred the recovery in the first place, could the inevitability of higher rates create a crash in the housing market 5 years from now when all these low rate mortgages come up for renewal?

Peter:
That's a very legitimate concern; but remember, the same people who lowered rates to stimulate the economy will be very careful not to undo their hard work by letting them rise too fast.

Having said that, the prudent thing, for anyone getting a mortgage today, would be to budget for an increase of about 3% upon renewal. So my advice is to take advantage of these current low rates and increase your mortgage payments as much as your budget can afford. That way you will accelerate your debt reduction and when the day comes that you have to renew into a higher rate, you will do so with a lower principal balance.

Russ:
And that will help you keep your payments down. Thanks Pete, some good advice. In the Business Centre, I'm Russell Byth.

Some things you probably never knew about Edmonton, Alberta:

• The name "Edmonton" is a Latinized version of a Saxon word meaning "Happy Hamlet,” and was used to honour the home of HBC governor James Winter Lake who was from Edmonton, England.
  
  

• The city's population stands at 782,439 people as of April 2009; while Edmonton’s metropolitan population is more than a million people.
  
  

• Edmonton is the gateway to a land of majestic mountains, pristine lakes, historic rivers and northern adventures and northern industries of oil, gas, lumber and mining. Edmonton is located on the TransCanada Yellowhead Highway, a route that offers the easiest and most scenic drive across western Canada.
  
  
• The city of Edmonton began as a North West Company fur trading post in 1795.
  
  
• During the Klondike Gold Rush of 1897 prospectors and adventures travelled by rail to Edmonton and then began the long overland journey to the Yukon. Edmonton became the last supply centre on route.
  
  
• Edmonton is Alberta’s capital city. The Legislature is an iconic building of grand architecture where people flock to wade in or skate on the outdoor ponds.
  
  
• Edmonton’s Waste Management Centre of Excellence has one of the world’s highest standards in recycling, composting and minimizing landfill. The Clover Bar facility diverts 60per cent of its solid waste, the highest diversion rate across Canada.
  
  
• Edmonton won the 2009 Corporate Knights Sustainable Cities Ranking for the large city category.
  
  There's more at the EEDC

With the holidays around the corner ( I know I am pushing it!) there is never a better time to give back. Coming out of an recession is hard on everyone's pocket books and sometimes it is most obvious during the holidays.

There are so many great charities to take part in. I have been invited via Facebook to Wrap Harder which sounds like a lot of fun.

Another one via the news Stuff a bus - the Edmonton Food Bank hopes to raise 240,000 kg of food. That's right about $90,000 or a bus full of food!

A great idea. I hope to do all I can here. Canadian Feed The Children Best Gift Ever is a great program where you can donate in someones name.

The gifts range from about $15 dental care for a child in a developing country to a $2000 new school. There are all price ranges in between. My husband and I are doing this for each other.

These are hilarious.  You will definitely get a few laugh out loud guffaws. They are all from different sources on the net and are only as dirty as your mind and bad grammar. From the REIN site.

Complaints from Renters
 
1. I want some repairs done to my oven as it has backfired and burnt my knob off.

2. The neighbor’s 18 year old son is continuously banging his balls against my fence. Not only is this making a heck of a noise, but the fence is now sagging in the middle.

3.  I am writing on behalf of my sink, which is running away from the wall.

4.  I wish to report that tiles are missing from the roof of the outside toilet and I think it was bad wind the other night that blew them off.

5. I request your permission to remove my drawers in the kitchen.

6. The toilet is blocked and we cannot bathe the children until it is cleared.

7. Would you please send a man to repair my spout, I am an old age pensioner and need it bad.

8. I want to complain about the farmer across the road. Every morning at 5:30 his cock wakes me up and it's getting too much. Its all right when my husband is on day-shift, but when he's on back-shifts or nights I get it several times a week from Mr. Docherty next door and at my age it's too much.

9. The man next door has a large erection in the back garden, which is unsightly and dangerous.

10. Our kitchen floor is very damp, we have two children and would like a third, so will you please send someone to do something about it.

11. The toilet seat is cracked - where do I stand?

12. I am a single woman living in a downstairs apartment and would be pleased if you could do something about the noise made by the man I have on top of me every night.

13. Please send a man with a clean tool to finish the job and satisfy the wife.

14. I wish to lodge a complaint against my neighbor in 211.  When I get undressed at night I can see him looking in my window with binoculars. Do I need to pull down my own shades?

15.  When I'm in the shower I turn on the water and I get hot. Could some nice repairman fix my pipes so I don't always get hot?

Lots of good quick reads in your mid month update. Take a few moments to reflect on how businesses are using this downturn to set up labour contracts and align future projects.

This is very similar to 2002 and around the Kyoto Accord time when the market was full of fear and FULL of deals. Although I think we're a ways off from a full recovery, you can clearly see the strength and backbone to Alberta's economy.

Managing your current investments and and adding new ones at this time, will have you smiling in 2012 onwards as the economy begins to shine again.

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Canada's Tar Sands Are The Future Of Oil Production: Total

By Michel Viatteau (AFP) – 11.13.09, MONTREAL

"The era of oil gushing from ground wells is over and can only be replaced by costly and complex refining of deposits such as Canada's oil sands to satisfy rising global energy needs, said a senior oil executive. Pressed about the high cost of oil sands extraction and attacks by environmentalists worried about its contribution to global warming, Jean-Michel Gires, president of French-based Total's Canadian subsidiary, told AFP he is optimistic specifically about the future of Canada's oil sands development." GRAB THIS STORY

Keyera to Spend $58M in Edmonton Area

Edmonton Journal, 13th November 2009

"EDMONTON - Imperial Oil’s $8 billion Kearl oilsands project has generated a long-term deal with Keyera Facilities Income Fund to provide diluent transportation, storage and loading services in the Edmonton area." READ MORE HERE

Suncor Budgets $5.5 Billion for 2010

International Business Times, November 13th 2009

"Suncor Energy Inc, Canada's biggest oil company, said on Friday it is budgeting C$5.5 billion ($5.23 billion) for capital spending in 2010 and will restart construction on its Firebag Stage 3 oil sands project. Suncor, which dominates Canada's oil sands region following its C$22.7 billion acquisition of Petro-Canada in August, will use C$1.5 billion for growth project funding at its oil sands operations and C$4 billion in sustaining existing operations." FULL ARTICLE

As you can see from the articles selected in your mid-month update, the big plans for Edmonton and Alberta continue. Many will wait until they see the economy in full recovery while the smart money continues to pick up the deals now.

"I shall make the most of all that comes: And the least of all that goes." - Sara Teasdale

I appreciate all your calls and emails. I'm looking forward to helping you put together your next deal.

Thank you,

Todd and Danielle Millar-

To get our free bi-weekly newsletter with great information on the Alberta real estate market, Alberta economy and Canadian real estate investor tips Click Here

"Meanwhile, according to ATB Financial economist Dan Sumner, the average Albertan spent more per capita on retail items since 2004 than people from any other province, yet in 2008 the average Albertan saved 13.7 per cent of disposable income, compared to a national average of 3.8 per cent. The reason for this discrepancy is that Albertans have had greater disposable income than people in other provinces, with high incomes and lower taxes. That will attract young people from Central Canada."

You can expect population growth in Alberta to continue at a steady pace. The article goes on to state that real estate is not where people will be investing in the futue.

I know that with a statement like the one above and all people generally needing a place to live - real estate will be the way to go for me. I invest in other things sure but as far as being able to control my own investments I want tangible real estate.

The days of oil rigs pumping furiously are coming to an end. Unconventional sources of oil require more manpower to get the oil out of the ground.

What does oil have to do with real estate?

Imagine if your investment property was near the next big oil reserve, workers from around the world were going there to live and work for the next few decades. Tenants were willing to pay top rents because the economy was booming and they were making oil dollars.

Alberta is that place, with vast oil sands that hold a proven 175 billion barrels of recoverable oil, second only to Saudi Arabia. The most impressive part is that Alberta has only just begun; experts say oil sands production can be sustained for at least 400 years.

"These are ambitious projects, very big projects, and thus very expensive," he said in a telephone interview from Calgary, Alberta -- Canada's oil capital.

"It's clear that cost is a problem," he conceded. "But it's also an important deposit -- several billion barrels of oil in the ground -- while more conventional sources of oil that would be relatively easier to extract are either drying up or are inaccessible to international firms such as Total."

"The price of energy is not going to collapse," despite downward pressure from a spiralling global economy, Gires predicts.

"To justify our massive investments in the oil sands, we're looking at what the world will look like in 2020, 2025 or 2030," he said.

"In the long run, despite all of the efforts to boost energy efficiency and develop alternative energy sources, the planet's appetite for energy ... will mean additional oil production will be welcomed and we'll find buyers for our output."

Think of the long-term, not an economy that in coming out of a recession but as the world starts to recover and the demand for oil increases - rents, property values will again increase. Maybe not like 2007 in Alberta but steady consistent growth that makes investors happy.

I was reading Dr. Demartini's Count Your Blessings. It's a really good self-help book for being appreciative of what you have even the bad things.

Once you can do this you'll notice your health getting better. For example the man with crippling arthritis never being willing to "stand" or "bend" to his employer's will. Does mental health affect physical health? You bet.



Anyway I'm getting off-track. I wanted to share the free digital radio station listed on the back of the book. HayHouseRadio.com is free for anyone. It's inspirational talk radio featuring top Hay House authors (like Dr. Demartini).

Some programs where a little much for me - I still don't believe in crystals but I found other programs very uplifting.

So give it a try!

Wherever your real estate investment is located—provided you bought it at the right price and terms—there are many ways to keep your property profitable. If you analyze your real estate, update and improve your investment team, review your long- and short-term investment plans and stay focused on the end result; your real estate portfolio will be a rock solid fortress that can weather any storm.

Analyze

The first and most important thing is to carefully analyze your portfolio. 

• What properties are doing well?
• Are there properties that are slowly leaking dollars like a dripping tap?
• If so how can you fix them? 

If you don’t know the hard numbers on your properties, then you are risking everything that you have worked for. Keep your budgets in line and carefully evaluate every purchase and renovation. Once you have a better idea of where you stand, you can start to recession-proof your properties. First, your customers are your tenants, so learn how to keep them happy and decrease vacancies. For example:

• Provide Internet or free cable
• Give lease incentives or rewards for rents paid on time, or even the best garden.

Increase your revenue by adding rental units to your properties or other moneymaking add-ons like renting garages separately, extra parking spaces or coin-op laundry facilities. You can also refinance your mortgages with longer amortizations, increase rents where reasonable or rent your properties furnished.

Evolve and involve your team

• Is your property management up to par? 
• Are you getting discount rates for a big portfolio? 
• If you have few properties are they being managed in a way that will help you grow your portfolio?  
• Are their rates competitive and are they keeping your property in excellent resale condition?  

Streamline your team. I don’t mean fire everybody and do it all yourself, but rather make your team out of the best players available in your area. Once you have the all-star team, get their input and advice, use their knowledge and experience to protect and improve your assets and your position in the market. Accountants can help you lower your taxes, lawyers can protect your assets, bookkeepers keep you aware of money liquidity and property management can up the cash output of your investment property.

Be aware

Be aware of longer-term trends and statistics. Don’t get caught up in the moment—especially when making decisions. There are both positive and the negative things that are happening in headlines. Take both sides into account and be realistic as you evaluate what’s really going on. Review your business plan both short-term and the long-term and adjust it as necessary. Don’t knee-jerk react, but also don’t drift back and forth without any solid goal in site. Have multiple investment strategies all with a clear exit in place.  

This is not the first economic downturn the world has seen nor will it be the last. What is important is to mind your business and your properties to make them profitable no matter what comes your way.