October 30th Mortgage Industry Update
October 30th, 2018 Mortgage Industry Update
The Bank of Canada announced on October 24th that it’s overnight lending rate will increase to 1.75% from 1.50%. The prime rate increases from 3.70% to 3.95%. The common prediction currently stands at the Bank of Canada continuing to increase rates in the near future as the word “gradual” was omitted from their recent release.
Additionally this week:
– Breaking News: Bank of Canada increases overnight rate to 1.75% from 1.50%. The Bank rate is correspondingly 2% and the deposit rate is 1.50%. We can expect an increase in prime and variable rates with all lenders to 3.95%.
– Re/Max report: Sales of Toronto single-detached homes priced from $1-2M fell 35% from 2017. In $2-3M range, down 50%. $3M+ down 44%. However condo sales in $1-2M range up 2%.
– In its latest data release, Statistics Canada announced that Canadian inflation stood at 2.2% in September, noticeably dropping from August’s 2.8% and defying economists’ projections of 2.7%.
– CMHC survey: 85% of first-time buyers reported spending the most they could afford on their property. 76% say they were still confident that they would be able to make their monthly mortgage payments.
– Royal LePage: Despite Q3 gains in the City of Toronto and Mississauga, the average home price across the GTA declined 0.4% year-over-year to $836,402. Also predicts 2% Toronto region gain in prices in the last quarter of 2018, compared to its national forecast of 1.5%.
– Bloomberg analysis: Latest numbers indicate that flippers represent only miniscule proportion of home transactions in Toronto + Vancouver. In Toronto, flipped condos accounted for a mere 1.8% of total sales as of June 2018. Far below the 4% rate a mere two years ago in April 2016.
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.