Real estate people are saying that one of the mortgage changes announced by the federal government earlier this week is going to hit first-time home buyers hard. First-timers who don't have a down payment of 20 per cent or more are going to have to take a stress test to see if they can handle interest rates at roughly double today's levels. This stress test is already in place for variable-rate mortgages and loans with a term of less than five years. Now, it's being expanded to the very popular five-year term as well.

A mortgage planner points out here that the effect of this move could reduce the amount of mortgage people can get by more than 20 per cent. Net result: "It's hard to picture any near-term scenario other than suddenly dropping demand and home prices." So should you buy now or wait? Our mortgage planner says it's pointless to try and time the market, so let's say the answer is to buy when you're financially ready. For practical help on that, consult my Real Life Ratio and my 10/10 rule.

If you're wondering how big a hit you'll take if interest rates do rise, check out this encouraging blog post by another guy in the mortgage biz. He describes a couple of factors that can take some of the sting out of higher rates.

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Ask Rob

The question: "I had a TFSA over-contribution of a couple hundred dollars years ago. Probably in the first three years of the program. I got the notice, called and got a real jerk on the phone. Basically told me to go find the forms and do the calculations with no directions about where to find the forms or anything. Basically I procrastinated until I forgot. Nothing ever showed up on my taxes. There is no mention on the CRA's My Account website about an over contribution. Any suggestions on what, if anything, I should do about this?"

My reply: I asked an accountant and he said: "In the early years, there were massive misunderstandings with TFSAs. CRA waived many penalties. Your reader may have been one of the lucky ones if there is no penalty showing up on his CRA account. I don't have any other words of wisdom other than to review his TFSA history online to see if there was a reversal of a penalty at some point."

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Ever hear someone tell you they bought their house for peanuts and sold it for a small fortune? If it sounds too good to be true, sometimes it is. Many people conveniently forget to factor in real estate agent fees, mortgage interest, maintenance, property taxes, and more. The actual gains are quite a bit lower than many people think.