This begs the question about whether a celebrity needs a confidentiality agreement or not when it comes to purchasing real estate. Truthfully, there’s not really a good answer for this because it’s the wrong question. The correct question is whether a celebrity can get a confidentiality agreement when it comes to real estate purchases.
The initial answer off the cuff is “no”. The more complicated answer is “it depends.” Let’s explore both of these.
Residential real estate, when we’re talking about buying and selling homes, is an open disclosure industry. Every person has the right to go through both local and state records to learn anything about any house and who the homeowners are. In every community across the country, when homes are bought and sold the listings are posted in the newspaper. The name of the buyer is listed; the names of the sellers aren’t always listed, though the names will be in the local and state records. So, in this instance, there is no confidentiality agreement to even consider.
Now, if a celebrity is looking to buy property with the intention of building a home, suddenly the rules change. Strangely enough, buying property is often considered as more of a business purchase than a personal purchase, and therefore it’s easier to disguise yourself if that’s your intention. In this instance, a celebrity who’s looking for some privacy can get a confidentiality agreement by hiring someone to act as a broker on their behalf to acquire the property.
And one other thing is at play here. Though once a home is purchased the buyer’s name will be disclosed, before a home is purchased the buyer can actually have a confidentiality agreement with a broker, who becomes the person searching for the home. A celebrity might fear that someone might increase the price of a house if they know a famous person is interested in buying it, or might spread the word around the neighborhood that someone well known is a potential buyer. Some celebrities would rather keep that private, and in that case having a confidentiality agreement works well.
The current Canadian mortgage rate of 5.25% is being raised to 5.85%, up six-tenths of a percent. This move is being followed through by five of Canada’s largest banks and will affect all five-year mortgages. The report from the Conference Board of Canada comes just as CIBC and National Bank announce they too, were raising their mortgage lending rates by more than half of a percent, ahead of the Bank of Canada’s anticipated rate hike that is expected this summer. This likely spike in bank rates will end the historically low mortgage rates that have brought us into 2010.
The Conference Board of Canada claims the high debt loads that are being taken on by consumers are an attempt to get in before the mortgage hikes take effect. These same homebuyers are considered responsible for the housing market rebound that Canada has seen up until now. However, there is a fear that anxious consumers will continue to overextend themselves in an attempt to get into the housing market meanwhile, the level of Canadian incomes has remained relatively consistent, not providing enough of an increase to match the housing prices.
Much of the problem lies with the buyers who didn’t put a lot down, which means their mortgage payments are quite high. Combine this with an increased mortgage rate and the outcome will be homeowners with a serious affordability problem. If the current prime rate of 2.25% rises by 2.5 percentage points, which is an average cycle increase, a variable mortgage rate could cost a homeowner about 30% more per month.
A large segment of the housing population’s demands have not been met due to the heightened fees of construction, resulting in developers being focused on building homes aimed at people in the higher tax bracket. There is also a gap in rental availabilities as developers are building condos instead of apartments, leaving rental properties sporadic and expensive.
There is an element of concern that there could be more defaults on loans or more home foreclosures due to interest rate increases, but it is felt that most people will find ways to cut expenses to pay off their mortgages, which may pose a risk to Canada’s recovering economy. If you feel that you are in a position of needing to tend to a bad credit rating or financially prepare for the upcoming rate hikes, a private bad credit loan may be an affordable answer.