August 31st, 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:
– According to the Economist, which released the results of its biennial Safe Cities Index this week, Toronto placed second on a list of the world’s top 60 safest cities, directly behind first place winner Copenhagen and directly ahead of Singapore, Sydney and Tokyo.
– Prime Minister Justin Trudeau has promised to introduce 2 year ban on foreign home buyers and make home purchasing process more transparent if re-elected. Also promised to lower CMHC mortgage insurance rates by 25% and introduce a tax-free savings account for first-time buyers.
– Statistics Canada: Mortgage debt associated with private lenders grew by 0.9% annually to $346.6 billion in June, while non-mortgage loan liabilities expanded by 1.2% during same time frame, amounting to increase of $8.5 billion and representing second consecutive month of gains.
– Canadians paid down their non-mortgage debts at the fastest pace in 30 years during the pandemic, new numbers from Statistics Canada show. The data agency said that credit card debt declined by 18 per cent in the year from February 2020 up until the end of January 2021.
– Statistics Canada: Balance of household mortgage debt grew 1.4% monthly in June; increase of $23.6 B. Largest monthly increase on record. Annual growth of 9.2%; not seen since October 2008. Total value of residential mortgages up 1.2% to $1.73 T, strongest pace since 2007.
– Rentals.ca report: Rents for condos and apartments are virtually back to 2019. Biggest jump in 2021 was among larger, luxury units – $2,795 a month in January versus $3,350 a month in July. One bedroom rents increased by 1% from June to July and were up 4.2% for a two bedroom.
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.