July 20th, 2021 Mortgage Industry Update
The Bank of Canada announced on July 14th 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:
– CREA: Home prices are down for the third consecutive month since reaching a peaking in March. Average national home price of $679,051 is still up nearly 26% compared to a year ago, it’s down 1.3% from May and has retreated 5.3% from the high of $716,828 reached in March.
– OREA Poll: 46% of prospective home buyers under the age of 45 have considered or are considering moving out of the province to afford a home, while 33% under the age of 29 are definitely (11%) or very likely (22%) to buy outside of Ontario.
– Sotheby’s International Realty Canada: GTA recorded 414 properties sold for over $4 million in the first six months of 2021, up 276% compared to the 103 such properties sold over the first half of 2019. 15 ultra-luxury properties sold at values of more than $10 million (up 114%).
– Bank of Canada stands still on the overnight rate at 0.25%. Good news for variable rate mortgage holders as there is no expected change in prime rates!
– Statistics Canada: The economy added 230,700 positions last month. Economists’ expectations were for an increase of 175,000. The nation had lost 275,000 jobs in April and May. The unemployment rate fell to 7.8% from 8.2%.
– First-time homebuyers in Canada have soundly rejected the federal government’s First-Time Home Buyer Incentive program, announced nearly two years ago. As of January 31, 2021, only 9,108 approved applicants had received the FTHBI. Just $170M has been disbursed out of $1.25B.
– TRREB: 11,106 property sales in June across entire GTA. Represents 28.5% surge annually, 7% drop from May and sharp comedown from March when more than 15,000 homes were sold. Average price for all homes sold was $1,089,536; 17% jump annually. Slight drop from May’s record of 1.1M.
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.