August 13th, 2024 Mortgage Industry Update
The Bank of Canada announced on July 24th that its overnight lending rate will be cut to 4.50% from 4.75%! Marks the second back to back rate cut! Recent data has increased confidence that inflation will continue to move towards the 2% target. The prime rate decreases to 6.70% across lenders.
Additionally this week:
– Urbanation: July national average asking rent for all residential properties climbed 5.9% yearly to $2,201, marking slowest annual growth rate in past 31 months. Did increase 0.8% monthly. Toronto average rent saw monthly increase of 0.2% but was down 4.6% annually, to $2,719.
– Canada is exploring new regulations that could reduce number of employers eligible to hire temporary foreign workers. Federal government is taking steps to limit the use of temporary foreign worker program after significant expansion led to allegations of fraud and exploitation.
– TransUnion: Canadians are carrying about $2.4 trillion in car loans, mortgages and credit card debt. There is an increase in delinquencies and ~10% of Canadians only make the minimum monthly payment on their credit cards. Average mortgage balance for Canadians is now $360,355.
– TRREB: There were 5,391 home sales in July 2024, a 3.3% annual increase. New listings were up 18.5%. The MLS Home Price Index Composite benchmark was down by 5%. The average selling price of $1,106,617 represented a slight 0.9% decrease from July 2023’s figure of $1,116,950.
– NerdWallet’s latest Monthly Down Payment Monitor: Average Canadian homebuyer would need to save between $16,000 and $75,000 for a minimum down payment, depending on the province. Ontario had an average home price of $884,761. The minimum down payment required there is $63,476.
– Statistics Canada: GDP increased in May by 0.2% after also rising in April, leaving economy on track to grow at annualized rate of 2.2% in Q2 – a faster clip than both economists and the Bank of Canada had forecast. Q1 GDP increased at a pace of 1.7%, experts had predicted 1.5%.
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.
