October 6th Mortgage Industry Update
October 6th, 2020 Mortgage Industry Update
The Bank of Canada announced on September 9th that its overnight lending rate will remain at 0.25%. The prime rate remains 2.45%. The Bank of Canada has openly stated that it will more than likely keep rates at this “effective lower bound” for the immediate future until the effects of the pandemic are more clear.
Additionally this week:
– Royal LePage Luxury Property Report: From March 15 to September 9, price of a luxury condo in Toronto dipped by 1.6% year-over-year to $1,870,000, while in the GTA, the price fell by 3.6% to $1,830,000. Luxury houses in the city saw gains of 5.4% to a median price of $3,187,500.
– Scotiabank survey: Nearly 1 in 5 young Canadians aged 18-34 say the pandemic has accelerated their plans to purchase a home or investment property. Reason can be attributed to recent lockdowns on those confined to smaller living spaces and wanting to upgrade to a larger space.
– BILD: 4,539 new homes sold in August, up 217% from 2019 and 119% above the 10-year average. Highest number of new home sales for August since they started tracking in 2000. Single-family home sales up 355% from 2019, 139% above the 10-year average to 1,930 units sold.
– CMHC: About $1 billion worth of mortgage payments were deferred each month during the pandemic. The calculation, released in CMHC’s annual residential mortgage industry report, is based on Equifax Canada’s estimate that the average monthly mortgage payment in Canada is $1,333.
– More than 40% of prospective first-time homebuyers think now is a good time to buy, according to a survey commissioned by BMO Financial Group. 29% of respondents said they were now looking at homes in the suburbs and rural areas, rather than homes in major cities.
– Statistics Canada: Nationally, new home prices up 0.5% from July to August, largest upswing since May 2017. Large urban markets posted noticeable increases, with Vancouver’s 1% monthly gain, Toronto’s 0.3%. New home prices up 2.1% from 2019, largest increase since March 2018.
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.