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Things To Consider When Purchasing a New Home Part 2: Timing

Sunday, 29 August 2021

After speaking with a mortgage broker and determining how you are going to purchase your new home, the next consideration, often overlooked, is Timing; when you plan to take possession of your new home. Getting your rental expiry date to line up with your new home possession, and also making sure your mortgage interest rate hold lines up with possession are some things we'll discuss in this blog.

Mortgage Interest Rate Holds

When you get pre-approved for a mortgage, the lender will hold a rate for you, often for 90-120 days. You can also get rates held for a longer time such as a year, but this will often times result in the rate being slightly higher. If your home won’t be ready to move in for upwards of a year, and you are concerned that the interest rates are going to rise in that time frame, opting for a longer rate hold, and incurring a higher rate, may be your best option.

Lining up your possession date with the mortgage rate hold while still having control of selecting your finishing materials can be challenging. Here’s a tip that will help. The sweet spot number of days before possession that you want to pay close attention to is 120 days. If you are buying a townhome that is a spec (the home is framed up and built to drywall stage), usually the builder can have the home ready for possession within 120 days of you making your selections. This is a great time to lock in a competitive mortgage rate and still have the ability to customize your home.

PRO TIP: When you get within 30 days of your possession day, ask your mortgage broker to shop rates one more time, you might find there are some quick closing specials that may reduce your interest rate or offer better terms.

Dealing with Rental Leases

A rental lease is an agreement between you and your landlord to rent their premises for a specific amount of time, usually one year. But what if your possession date on the new home you bought comes up before the lease expires? Will you have to carry two homes for a period of time? Let’s dig into this.

Your landlord’s biggest concern is keeping his/her property rented. If they are easy to communicate with and you plan ahead, they can help facilitate your early departure by starting the process of qualifying a new tenant prior to the expiry, ensuring there is no vacancy. Alternatively, a heads up notice that you would like to stay in the place for an additional month or two beyond the expiry date should also be easily accommodated.

PRO TIP: Take a look at your rental lease, and see if there are any clauses regarding “sub leases”. Sometimes it states that if you find a replacement tenant, than you can exit the contract. Speak with a professional to find out the best way to use this term in the rental contract to your advantage.

Good communication and being proactive with your landlord goes a long way when figuring out whether you need extra time on your lease or need to exit prematurely.

Its Not About "Timing the Market…"

Timing the market often comes up as being a major reason buyers hesitate or put off purchasing a new home. Some great advice is this: Don’t worry so much about timing the market. You will never be precise in buying at the lowest price. Instead, look at the monthly costs - if you are comfortable with affording those costs, then jump in. Making a return by being a homeowner comes down to how long you are in the market. It is over a long term period that you are paying off your mortgage principle, and if the market goes up in value, that is certainly a bonus. Real estate is not the same as the stock market. Gaining equity over a long term, and reducing your mortgage principle should be your focus as a first time home owner.

As the saying goes “ don’t wait to buy real estate, buy real estate and wait!”

Check out Rockfords quick possessions and upcoming releases. There's price points and possession times both short term and long term.

Will the Calgary Housing Market CRASH!? The answer might surprise you

Sunday, 6 June 2021

The Calgary housing market really took off this spring with a lot of action from buyers and sellers walking away with a premium on their house sale. An increase in buyers entering the housing market, coupled with a limited inventory of homes, helped to create a sellers’ market that saw homes selling in their first days on market, often with competing numbers. With the continued frenzy still going on in June, and with news of the “housing bubbles” in Vancouver and Toronto, many are asking “will the Calgary housing market crash?

Looking at future projections and key statements made by the federal government and bank of Canada, there are a few key takeaways that should give optimism to anyone still looking at purchasing their first home. Not only will the Calgary housing market not crash, it is actually expected to stay positive throughout the next couple of years. Here are the top three reasons to support this claim!

Returning Optimism

Its starting to feel like the beginning of the end of the pandemic. As vaccines become more readily available, and to more age groups, the optimism of things returning to normal is becoming more real. Just recently, Jason Kenney announced that potentially as early as June 11, we could reach a new phase in returning to normalcy, including reopening public libraries, indoor restaurants, gyms, and even movie theatres. There is even plans to have the Stampede return (even if its scaled back, this is still huge news!). And this is all great news for buyers and sellers of real estate. During the pandemic, Canadians saved much more than typical, going from around 3% before the pandemic to over 25% during. Uncertainty around job security forced people to save during these times in the event they lost their income.

With the vaccine rollout there is a lot more confidence in the job market which is also showing in the housing market. Now that the light at the end of the tunnel is becoming more apparent, these same savers will most likely become the biggest spenders opting for home ownership or larger homes to accommodate their new lifestyle of working from home which is becoming more acceptable and even preferred with many companies.

Long term stability of low interest rates

Interest rates continue to be at historical lows of just 2.45%. And with the Bank of Canada announcing that they plan on keeping it this way until at least October 2022, speculation for the future becomes much more predictable. But another interesting thing happens when the bank of Canada lowers the interest rates and announces no changes to be made until that far down the line – firms and households increase their demand for credit, and commercial banks increase their quantity of credit supplied.

This is huge, especially for the housing market. Having lower interest rates, and a larger pool to draw from, makes it easier for purchasers to finance their home, as well as increases the amount the amount they can borrow, giving them more choice in the market. One caveat to mention though is that they did also increase the mortgage stress test (read more here) to slow down the flurry of buyers entering the housing market. Regardless, low interest rates attract more buyers, and until the interest rates increase, you can expect people to take advantage of the low cost of financing.

Increase in Immigration

When the pandemic was officially announced in February of 2020, the Federal government gradually introduced stricter measures to limit travel into Canada. As a result, we saw immigration decrease by over 60% in 2020. Eventually, international travel did become more permissible, however, anyone entering Canada from another country were forced to be quarantine at approved hotels, with security present. Covid testing was also strictly enforced to ensure those travelling did not unwittingly bring the virus to Canada.

With the steady pace of vaccinations rolling out, these international travel restrictions are expected to be lifted, and with that, immigration to resume. In fact, during the last quarter of 2020, Marco Mendecino, the Canadian minister of immigration announced plans to significantly increase immigration levels in 2021-2023 to help the Canadian economy recover. (read article here). His projections are that over 400,000 immigrants will become permanent residents of Canada PER YEAR. To put this in other terms, if those numbers are met, that could mean that approx. 3% of Canada’s population could be newly landed immigrants by end of 2023.

With immigration comes an influx of investing, new opportunities, and an increase in the labor force. Over the next three years, over 1.2 million new people will move to Canada, and they are going to need a place to rent or buy!

If you are planning to purchase your first home soon, rest assured your investment will be well spent. Calgary is already one of the top ten best places to live, but if you zoom in enough on the map, you’ll see Axis at Walden, where we have some of the best built townhomes. Treat yourself to an amazing home, in an amazing city!

Our show homes can be found at 10 Walden Lane S.E

Hours of operation are 2-7pm Monday-Thursday, closed Friday, and open Saturday/Sunday/Holidays from noon – 5pm.

How to Get Pre-approved for a Larger Mortgage

Tuesday, 20 April 2021

Staying under budget when house hunting can be a difficult task. After finding the right home, and adding all your personal customizations, the final amount might be slightly higher than you expected. Here’s a quick guide on getting approved for a larger mortgage that will help you get everything you want in your home!

Make a Larger Down Payment

In Canada, every property purchase requires a minimum cash down payment, ranging from 5% to 20% of the purchase price. One of the most important factors in how big of a mortgage you can be approved for is the amount of your down payment. If you are purchasing a more expensive home, it will require a larger minimum down payment. The amount of down payment is one factor that is very much in your control.

Here are the minimum down payment rules in Canada:
• Homes under $500,000 = 5% down payment is required.

• Homes more than $500,000 but less than $1 million = 5% of the first $500,000 plus 10% of the remaining purchase price. (

• Home more than $1 million or more = 20% down payment.

For example, a $500,000 home only requires a 5% minimum down payment of $25,000. However, on a $800,000 home your minimum down payment will need to be $55,000 (5% of 500,000 + 10% of 300,000 = 25,000 + 30,000 or 55,000 total). This represents an effective rate of 6.9% overall.

Here is a mortgage calculator you can use to easily figure out what your minimum down payment is.

Click here for mortgage affordability Calculator

Increase Your Income

Increasing your income isn’t a quick or easy task, and switching careers probably isn’t an option you want to explore. Nevertheless, increasing your income will have a direct impact on the amount of money that you’re likely to be pre-approved for. Here are a couple of options you might want to consider:

• Look at your current salary and see if it is possible to negotiate for a higher salary. Have you been taking on additional work that could warrant a discussion about increasing your wages?

• Find a job or career that pays more. Check within your industry to find out if you are being paid adequately. If you find there is a discrepancy, and your employer declines to increase your wages, that may be a sign it’s time to find a new employer that places a higher value on your services. The downside however is that you will need to work at your new job for a while before applying for another mortgage – the stability of your employment is a major factor when banks approve you for a loan.

• Find additional sources of income. This could mean working overtime, renting out your spare room, or taking on a second job. An additional source of income will increase the mortgage amount you can be approved for.

An alternative to earning more money, is applying for the mortgage with a co-signer (for example, your parents) who also has a steady source of income. This is a simple way to help you get a larger mortgage.

Pay Off Debts

Besides your income, your mortgage provider will also look at your debt. They compare your income-to-debt ratio to determine how large a mortgage to approve. Paying down debt is just as important as proving stable income. Too much debt will offset the income to debt ratio and limit your ability to qualify for a larger amount.

To improve your debt-to-income ratio, you will want to pay off as much of your existing debts as possible, including credit card debts, car loans, student loans, and any other lines of credit that require ongoing payments.

Improve your credit score

Your credit score is just as important as your income and debt when it comes to getting the best mortgage rate. It’s a representation of how often you make your credit repayments on time, and how fiscally responsible you are with credit (loans). A high credit score tells the lender you are responsible with paying back loans on time, and less of a risk to lend to. The lower your credit score, the less likely a lender will lend to you, or it could mean a much lower amount than you expected.

Generally, most mortgage providers in Canada won’t lend to you if your credit score is less than 600. If your credit score is lower than 600, you may be referred to a “B lender” which often charge a much higher interest rate, resulting in higher monthly payments. Here are a few steps to keeping your credit score in check:

• Check your credit score regularly. You can request a credit report directly from TransUnion or Equifax. There are other apps like Credit Karma that notify you monthly when your credit score changes. Knowing your credit score is an essential starting point to determine what needs improvement.

• ALWAYS pay your bills in full, and on time, especially loan repayments. Late payments will directly impact your credit score. If you can’t make an upcoming payment, call your credit provider before the due date to arrange an adjustment to your payment schedule.

• Pro Tip: never go over 30% of your total available credit. This will demonstrate that you don’t rely on debt, and shows that you are using your credit responsibly.

Get a Lower Interest Rate

Not all lenders are the same. Shopping around and comparing different lenders is a must if you want the best rate. Not all mortgage providers assess risk the same way and some may offer a better rate based on the level of risk and profit margins. Do your own research and see which lender best fits your needs. Missing this step could cost you thousands of dollars over the term of the loan.

Another consideration is the terms and conditions of your mortgage and mortgage rate. Often times the small writing is more important than the big writing. Ask your mortgage provider to explain the terms of the agreement to ensure you aren’t paying unnecessary costs or fees.

Interviewing multiple lenders is a good place to start. Don’t always accept the first offer, instead use it as leverage to see if the next lender can match or beat it. These initial consultations are free, and they are able to provide insight and advice that’s personalized to your lending needs.


Use the tips above to prepare yourself prior to applying for a mortgage. By determining things like what is affordable and what you want from your home, you will be more prepared when having the initial talk with mortgage providers.

If you’d like to run some test numbers on how much you can afford, use this handy mortgage calculator. This will provide an estimate of your ideal mortgage amount based on your income, debt levels, purchase price, etc.