April 2nd, 2024 Mortgage Industry Update
The Bank of Canada announced on March 6th that its overnight lending rate will remain at 5.00%. Bank of Canada maintains overnight rate at 5.00%! The Canadian economy looks to be operating in modest excess supply. The Bank continues to expect inflation to remain close to 3% during the first half of this year before gradually easing. The prime rate remains at 7.20%.
Additionally this week:
– In last year’s budget, projections for housing starts had Ontario building fewer than 80,000 new homes in 2024, but that number is now expected to be nearly 88,000. Those figures are set to continue rising slowly but steadily over the next few years, up to 95,800 in 2027.
– The Ford government is giving municipalities new powers to tax vacant homes amid a housing affordability crisis across the province. Currently, only Toronto, Ottawa and Hamilton have the tax. Provincial budget will extend those powers to all single and upper-tier municipalities.
– Money markets are betting on a 70% probability the Bank of Canada cuts its benchmark rate by a quarter point at the June 5th meeting. Odds of a rate reduction at the April 10th meeting have climbed to 20% following last week’s lower-than-expected inflation data.
– Home Trust Company’s business is being merged with Fairstone Bank of Canada, a move by parent company Smith Financial Corp. to bring over two million customers and 250 branches across the country under the same roof.
– The Office of the Superintendent of Financial Institutions says it has no plans to remove the stress test on uninsured mortgages for borrowers who choose to switch lenders. In response to recommendations released by the Competition Bureau which advocated for the removal of it.
– Immigration Minister Marc Miller: Currently, there are more than 2.5 million temporary residents living in the country, or 6.2% of the population. The government aims to decrease the temporary resident population to 5%, or about 2 million over the next three years.
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.
