December 14th Mortgage Industry Update
December 14th, 2021 Mortgage Industry Update
The Bank of Canada announced on December 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 mid 2022 now, as compared to initially saying late 2022.
Additionally this week:
– 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!
– Bank of Canada: Canada’s total HELOC load continued exhibiting robust growth to reach a total of $270.2 billion in September. This was a 4.4% increase ($11.4 billion) from 2020, the second-highest annual upswing since May 2019. Of this sum, $1.7 billion came from September alone.
– CMHC’s overall mortgage arrears rate has also decreased on a quarterly basis, from 0.31% to 0.29% as of Sept. 30. The total number of delinquent loans fell from 5,452 as of the end of Q2 to 4,999 by the end of Q3.
– RE/MAX Canada: Migration between provinces expected to continue in 2022. 49% of Canadians believe the housing market will remain steady in 2022 and view real estate as one of the best investment options. Estimating a 9.2% increase in average residential sale prices nationally.
– Move Smartly: Median Toronto home price has shot up a whopping 33% from last year. In October, the median Toronto home price hit $1,265,000 — up a third annually. The average home price overall has similarly skyrocketed, rising 28% since October 2020 to a new high of $1,455,088.
– Equifax: Borrowers with more than one home loan accounted for nearly 1/5 of mortgage market. Number of people adding at least 4th mortgage advanced 7.7%. In Toronto, close to 1/3 of purchases were completed by homebuyers with at least one other property. Up 10% from a decade ago.
– Better Dwelling: The national total value of homes hit $6.1 trillion in 2020, up 2.5% annually. Canada’s housing is valued at more than 300% of the country’s GDP now. Nearly half of Canada’s residential real estate value — 46.6% — is solely located in Ontario.
– Statistics Canada: A surge in household spending fuelled a faster-than-expected 5.4% annualized expansion in the third quarter — a sharp comeback from a disappointing first half of the year when the nation’s expansion stalled amid a third wave of lockdowns.
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.