December 3rd, 2024 Mortgage Industry Update
The Bank of Canada announced on October 23rd that its overnight lending rate will be cut to 3.75% from 4.25%! A cut of 50 bps as compared to the previous 25 bps intervals. Marks fourth back to back rate cut! Inflation has dropped below the 2% target now. We can expect further decreases. The prime rate now decreases to 5.95%.
Additionally this week:
– Statistics Canada: New Housing Price Index dropped 0.4% monthly in October. On annual basis it fell 0.2%. Marks sharpest monthly decline in more than 14 years. Toronto and Vancouver led the decline last month. New home prices in Toronto fell 1.2%, while Vancouver saw a 0.6% drop.
– Ford government: Ontario is exploring the feasibility of arrangements with one or more registered consumer reporting agencies (like Equifax and TransUnion) to facilitate access to Landlord and Tenant Board orders where tenants have a history of missed payments.
– StatsCan: Households are diving back into HELOC debt after an extended break. Households drove their balances 0.4% (+$720 million) higher to $170.8 billion in September. Represents a 3.0% (+$5.0 billion) increase annually, with balance now at highest level since November 2022.
– BILD: New condos (which include low, medium, highrise buildings, condo townhouses and lofts) accounted for 210 units sold in October — down a staggering 84% from October 2023 and 91% bellow the 10-year average. Condo prices also dropped by 1.6% year over year.
– Starting Nov 21 uninsured mortgage holders no longer need to pass the mortgage stress test when switching lenders at renewal, provided their loan amount and amortization period remain unchanged. Allows borrowers to shop for better rates without the added hurdle of requalification.
– Vaughan lowering fees it charges developers to build new housing “dramatically,” in a move politicians hope will help to boost number of homes built. Lowering development charges for all new homes back to their 2018 rates — and keeping them there for at least next five 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.
