The Bank of Canada announced on April 13th that its overnight lending rate will increase to 1.00% from 0.50%. The prime rate has increased to 3.20% from 2.70%. Canadian growth is strong and the economy is moving into excess demand. Labour markets are tight, and wage growth is back to its pre-pandemic pace. The Bank of Canada suggests that they will more than likely continue to raise interest rates over this year to tackle higher than anticipated inflation rates.
Additionally this week:
– The average monthly rent for Canadian properties in March stood at $1,818 (up by 6.6%) annually, according to new data from Rentals .ca and Bullpen Research & Consulting.
– As part of a need to update its key growth funding tools and reassess associated bylaws, the City of Toronto has unveiled a new scheme for a 49% increase for development charge rates, applicable to every residential housing type. The hike would take effect next April.
– Statistics Canada: Pointing to the housing segment’s sustained resurgence since economic reopenings late last year, new home prices nationwide grew by 1.2% monthly and 11% annually in March. The month-over-month upswing was driven by increases in 18/27 census metropolitan areas.
– Zolo report: While Toronto is notorious for being an expensive city to live in, its average home prices are actually less than other GTA spots. Didn’t even make the top 15 places with the most pricey houses in the area, even as the average price a house sold totals about $1.2M.
– CREA: Home sales were down 16.3% in March compared to last year’s record high, falling to 55,000 units. Average home price came in at $796,068, down 1.5% from February, while year-over-year price growth eased to 11.2%, down from the annualized 20.6% rise seen in February.
– Statistics Canada: Investment in building construction reached $20B for first time in February; 4% annual upswing – gains in most provinces. Quebec accounting for more than 50% of increase. Major driver of strength was residential, which saw investment volume grow 5% to $14.9B.
– Statistics Canada: Canadians increasingly tapping equity in homes for loans as higher real estate prices + loosening restrictions encourage spending. Balance of HELOCs rose 1% to $162B in February. Fastest monthly increase since 2012 and the fifth straight month of increases.
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.