June 8th, 2021 Mortgage Industry Update
The Bank of Canada announced on April 21st 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 the later half of 2022 now, as they observe the country’s faster than expected recovery from COVID-19.
Additionally this week:
– Canada’s economy could be in for a significant rebound this year, according to an upgraded outlook from the Organization for Economic Co-operation and Development. Now expects the Canadian economy to grow by 6.1% in 2021. Up from an estimate for growth of 4.7% made in March.
– Statistics Canada: Thanks to generous government support efforts, all households finished 2020 with higher incomes than the year before. Income inequality declined in 2020, as the gap between the highest- and lowest-income households shrank by 1.9%, compared with 2019.
– Re/Max Recreational Property Report: Nationally, 21% of those surveyed noted looking to buy real estate in a recreational community because they have been priced out of major urban centres while 22% stated lower borrowing rates have made purchasing a property possible.
– Statistics Canada: Up to one quarter of hours worked could be remote after the pandemic ends. That’s up from about 5 per cent pre-pandemic, the agency said. The figure for university-educated workers is 44 per cent, versus 9 per cent for those with no post-secondary education.
– Bank for International Settlements: Global property prices up by 4% annually in Q4 2020. Fastest growth rate since immediate aftermath of global financial crisis. Advanced economies led the way with an average increase of 7%. Canada among hottest markets, with real prices up 11%.
– CMHC: In Toronto, share of condos held by non-resident owners went down slightly from 3.3% in 2019 to 3.1% in 2020. Foreign buyers accounted for a significant amount of newer condo construction in the market. Non-residents owned 9,686 condo units in the city.
– Right at Home realty survey: Only 18% would sell to move out of a city to a smaller community. Meanwhile 69% of Ontarians stated that the pandemic has had no impact on plans to move. Only 3% stated that they are now planning to move as a direct result of the pandemic.
Stay tuned for the next update!
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