January 12th, 2021 Mortgage Industry Update
The Bank of Canada announced on December 9th that its overnight lending rate will remain at 0.25%. The prime rate remains 2.45%. The Bank of Canada suggests that they will more than likely keep rates at this “effective lower bound” until 2023, as they observe the full effects of the pandemic.
Additionally this week:
– TorontoRentals.com forecast: Price of rent will drop approximately $100 per month by mid-2021 from November’s average: $2,060. Will sharply rise 13 or 14% in 2022 to approximately $2,325, which is still 2019’s peak average of $2,454 per month.
– BILD: New construction single-family home sales continued to soar in November, up 68% from 2019, 58% above 10-yr avg. Benchmark price of a single-family home hit $1.27 million last month, 15.8% above 2019. 1,914 single-family homes sold; highest number for November since 2015.
– Teranet-National Bank’s National House Price Composite Index recorded a 0.9% gain month-over-month last month, the largest gain for a month of November in the index’s 22 years. That means a gain for all 11 of the index’s composite cities for the third consecutive month.
– CMHC Housing Market Assessment for Q3 2020: Little evidence of overvaluation in the Toronto real estate market. Examines level of vulnerability in country’s major real estate markets by considering overbuilding, overvaluation, price acceleration, and overheating.
– CMHC: The upward trend in Canadian housing starts continued in November, when the seasonally adjusted annual rate of housing starts rose 14.4% compared to October. Nationwide, starts tallied 246,033 in November, up from October’s 215,134.
– Statistics Canada: In the three months through September, Canada’s population was essentially unchanged, up 2,767 to just over 38 million. Citing negative international migration due to COVID-19 travel restrictions as main factor. Marks the slowest increase in data back to 1946.
Stay tuned for the next update!
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