The last few years have been turbulent times for investors. Unlike the U.S. and other countries, the Canadian housing market held steady and has been experiencing strength through 2010.

Record home sales in the first quarter of 2010, are considered to be due to a combination of factors. Pent up demand, low inventory levels and historically low Canada mortgage rates were a potent combination of market drivers. As the housing market becomes more balanced, with many housing inventory becoming available, prices should stabilize and grow at a much slower speed. In Ontario and British Columbia, many homebuyers also rushed to beat the incoming HST tax.

What does the future hold in store for the Canadian housing market? House prices are not expected to appreciate as much as they did in the first half of 2010. Therefore, buyers may find that the more reasonable listing prices, coupled with fewer buyers rushing in to make bids or multiple offers, will mean better value for their real estate dollar. The slight increase in mortgage rates over the second half of the year should not affect the affordability if money was saved buying the houses.

Although it is impossible to exactly predict what will happen with the Canadian economy and interest rates, the general consensus among all the major banks is that variable and fixed interest rates will rise over the next 19 months. The amount the overnight interest rates will rise is a matter of debate. Some banks, like the CIBC, predict that the overnight rate will be 2.5% by the end of 2011. Other banks predict the rates will go even higher. The Royal Bank of Canada and the Toronto Dominion bank predicts the overnight rate will rise to 3.5%. Most other main banks predict somewhere in between, with an average forecast of 3.17%.

Of course, these are only predictions and may change. The speed and strength of the economic recovery, along with global factors, will influence lending rates and monetary policy.

Whenever the time is right for you to purchase, selecting the right lender can save you thousands over the term of your mortgage. Choose a qualified mortgage broker who can shop your mortgage over many lenders to save you money and find the best mortgage rate in Canada.

The federal government of Canada changed the rules to make bankruptcy more expensive for many Canadians in 2009. The government has adopted an income test to determine how much a person must pay while bankrupt, and to determine how long a personal bankruptcy in Canada will last.

Under the old rules, each bankrupt was required to prove their income to their trustee each month, generally by submitting copies of their pay stubs. If their income exceeded a set amount, the bankrupt was required to pay a penalty of half of the amount they were over the limit.

Those rules still exist, but with an added twist. If on average the bankrupt’s income is more than $200 over the limit each month, the bankruptcy period is extended by an extra year, and the bankrupt is required to make surplus income payments for an additional year.

in 2009 a single person with no dependents and no unusual expenses is permitted to earn $1,870 per month, after taxes. If they earn $2,470 per month, they are $600 over the limit, so they are required to pay a surplus income penalty of $300 per month. Even worse, because their surplus income is over $200 per month, their bankruptcy will last for 21 months, as compared to a bankruptcy with no surplus income that can end in 9 months. They are required to pay the $300 penalty for 21 months, so obviously the cost of the bankruptcy is double what it was under the old rules.

The above example applies in the case of a first bankruptcy. In a second bankruptcy the bankruptcy period is automatically extended to 36 months.

It is critical that a knowledgeable bankruptcy trustee is consulted before bankruptcy is filed, to do a detailed estimate of potential surplus income. Here’s why:

A quick review may indicate that the bankrupt is expected to earn $1,000 every two weeks, or $2,000 in a typical month. Since $2,000 is only $130 above the limit of $1,870, it would appear that this person can expect to be discharged from bankruptcy in nine months. However, that may not be the case.

Twice each year a person who is paid bi-weekly will receive three pays. In those months their income is $3,000, or $1,130 over the limit. If they have two of those three-pay months during the bankruptcy, their average surplus income will be higher than $200 per month, and their bankruptcy will be extended for an extra twelve months. Obviously expert advice is required to accurately estimate the payments required in a bankruptcy in Canada, and that advice should be obtained before you decide to go bankrupt.