October 12th, 2021 Mortgage Industry Update
The Bank of Canada announced on September 8th 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 recovery from COVID-19.
Additionally this week:
– RE/MAX Canada 2021 Fall Housing Market Outlook Report: Average residential sale price for all home types could increase by 5% from now until end of year. Single-detached homes experienced biggest price gains when comparing 2021 to 2020, rising between 6.8%-27.3% across 29 markets.
– Statistics Canada: Inter-provincial migration estimates for Q2 indicated greatest number of Canadians moving to other provinces (123,500 people) since Q3 1991. This also represented an increase of 55.1% from the first quarter. BC saw largest net migration in Q2 (15,290 people).
– Rental.ca September 2021 National Rent Report: The average rent nationally for all property types in August was $1,763 per month, down 0.3 per cent annually, but up 0.6 per cent monthly and up 5.2 per cent from the recent market low of $1,675 per month in April 2021.
– Statistics Canada: GDP rose 0.7 per cent in August. That’s a reversal from July, which showed a 0.1 per cent contraction. Economists were predicting a 0.2 per cent drop in output for July, after early guidance indicating a weak start to the second half of the year.
– Royal LePage: In Q2 of this year, homeowners paid on average $769 less per month compared to renting an equivalent dwelling. “It is more financially beneficial to buy a home in Canada than to rent over the long term, in 91% of cases analyzed”.
– TransUnion: Demand for loan products such as mortgages remains strongest among Gen-Z (48%) and millennial (34%) Canadians, with a large share of these demographics saying that they plan to take out new loans over the next year.
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.