Harpreet currently provides his services to all of Southern Ontario whether you are a first time homebuyer, sophisticated real estate investor, or any step in between.

Contact

(416) 795-1919

Search Mortgage Corp. 100-50 Village Centre Place Mississauga, Ontario, L4Z 1V9 License #: 12652

harpreet@searchmortgage.ca

October 22nd, 2024 Mortgage Industry Update

The Bank of Canada announced on September 4th that its overnight lending rate will be cut to 4.25% from 4.50%! This marks the third back to back rate cut! Excess supply in the economy continues to put downward pressure on inflation, while price increases in shelter and other services are holding inflation up. The prime rate now decreases to 6.45%.

Additionally this week:

– Five out of six of Canada’s biggest banks (excluding TD) are now expecting larger than usual interest rate cut from Bank of Canada. Most major lenders have forecasted a 50 basis point cut in borrowing costs next week. Earlier predictions had leaned toward a 25 basis point cut.

– CREA now expects 468,900 homes to sell in 2024 – 5.2% increase from 2023. Average home price forecast to edge up 0.9% next year, reaching $683,200, before rising by 4.4% in 2025 to $713,375. Anticipates home sales will gain stronger momentum in 2025, with projected 6.6% increase.

– Statistics Canada: National inflation rate fell to 1.6% in September, hitting its slowest pace for more than three years. Gas prices plummeted 10.7% annually. Mortgage interest costs were 16.7% higher, while rent spiked by 8.2% despite moderating slightly over August.

– Royal LePage says it now expects the aggregate price of a home in GTA to increase 6% annually in Q4. In July it had said it expected the price to rise by 10%. The GTA is slightly ahead of the national price forecast of a 5.5% increase, which was also lowered from 9%.

– C.D. Howe Institute: Canada’s decision to increase capital gains inclusion rate is unlikely to generate as much cash as government expects. Will add $3.3 billion to federal government revenues from individuals over five years. Less than 40% of the $8.8 billion forecast originally.

– Re/Max Canada report, which examined condominium activity from January to August, found the GTA had yearly inventory growth of 53%. The GTA was the only region nationally where average condo prices declined year-over-year — a 1.9 per cent drop to $732,648 — over the period.

– Statistics Canada: Economy added more jobs than expected in September as unemployment rate ticked lower. Labour market tacked on 46,700 jobs last month, higher than consensus estimates of 31,500, while unemployment fell to 6.5% – marking first time it’s dropped since January.

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.

Author

Harpreet Singh