July 17th Mortgage Industry Update
July 17th, 2018 Mortgage Industry Update
The Bank of Canada announced on July 11th that it’s overnight lending rate will increase to 1.50% from 1.25%. The prime rate thus increases to 3.70% from 3.45% with most lenders. The common prediction remains that there will be no further rate increases for the remainder of the year.
Additionally this week:
– Bank of Canada increases overnight rate target to 1.50% from 1.25%. The Bank Rate is correspondingly 1.75% and the deposit rate is 1.25%. Prime rate increases to 3.70%.
– The workforce saw 75,600 new additions in June, the biggest month-over-month increase in 6 years, according to Statistics Canada. Employment jumped by 31,800 in the same month, Bloomberg reported.
– CIBC: Average Canadian homeowner has mortgage debt of $170k, but rises to $252k for those earning $100K or more. Among over 55s, 22% have a mortgage with a balance outstanding of $112k on average. Almost half of this demographic expect to carry mortgage debt into retirement.
– Royal LePage report: Home prices across Canada are expected to rise by 1.9% in Q3 as compared to Q2 after a slower spring. National House Price Composite is based on data from the country’s 63 largest real estate markets.
– Zoocasa study: Per TREB numbers, 27 out of 33 markets in the GTA require a household income of at least $100,000 to afford the average home. Only three – Oshawa, Essa, and Clarington – fall within the affordability range of the median dual-or-more income earning household.
– In response to U.S. president’s decision to slap taxes on goods from north of the border, Canada enacted a 25% tariff on U.S. steel imports on July 1. Condos are expected to be the most deeply affected sector, as the tariffs will significantly impact the prices of steel products.
Stay tuned for the next update!
For any questions and concerns please do not hesitate to call Harpreet Singh The Mortgage King at (416) 795-1919.