March 5th, 2024 Mortgage Industry Update
The Bank of Canada announced on January 24th that its overnight lending rate will remain at 5.00%. Bank of Canada maintains overnight rate at 5.00%! The Canadian economy has stalled since middle of 2023 and growth will likely remain close to zero through first quarter of 2024. Economy now looks to be operating in modest excess supply. The prime rate remains at 7.20%.
Additionally this week:
– Statistics Canada: Economy expanded in Q4, growing at an annualized rate of 1.0%. GDP probably inched upwards by 0.4% last month. The Bank of Canada had expected the economy to remain flat in Q4, while the Reuters poll revealed expectations of 0.8% growth.
– In 2013, 74% of residential properties in Ontario were valued at less than $500,000, and 91% were under $750,000. Fast forward to today, those numbers have plummeted to 19% and 48%, respectively.
– Equifax: While overall fraud rates have slightly declined from a 2022 peak, identity fraud has surged. It now accounts for roughly three-quarters of all fraudulent applications across all sectors in Q4, up from about 65 per cent the previous year.
– CMHC senior vice president Mathieu Laberge revealed that Canada is wrestling with its lowest national vacancy rate since the 1980s—a mere 1.5%. To make matters worse, rents have surged by 8%, a figure starkly above the historical average of 2.8%.
– Re/Max Canada poll: 32% exploring “non-traditional” ways of entering the ownership market due to the affordability crisis. Such as rent-to-own models (22%) and co-owning with a family member who’s not a spouse (21%), owning a home with plans to rent out a portion of the property.
– CBRE figures show that national downtown office vacancy reached a new high in Q4 2023, jumping to 19.4% from 15.8% the previous quarter, as Toronto faced particularly acute challenges filling office space. Rate continuing to climb in consecutive quarters.
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.
