April 14th, 2020 Mortgage Industry Update

The Bank of Canada held another emergency rate announcement on March 27th and cut its overnight lending rate from 0.75% to 0.25%. The prime rate has decreased to 2.45%. The possibility of further rate reductions remains unclear at this time as the economy deals with the COVID-19 pandemic.

Additionally this week:
– Statistics Canada: Employment plunged by 1.01 million in March from prior month, largest decline in records dating back to 1976. Jobless rate up to 7.8%, up from 5.6% in February. More than 4 million people (one in five workers) have already applied for emergency income support.

– Statistics Canada: The value of Canadian building permits likely fell 23.2% year over year in March as officials took action to fight the coronavirus outbreak. In Ontario, the value of building permits issued fell by 50.5% compared with March 2019, the estimate showed.

– A majority of Canadians are bracing themselves for further economic downturn, as the COVID-19 pandemic is set to enter its second month. An Angus Reid opinion poll shows that 87% of Canadians believe the worst is yet to come, while 3% feel the worst is over and 10% are unsure.

– TRREB: Overall, active listings of homes available for purchase across the GTA in March down 31.5% year-over-year. Continuing a trend that’s seen inventory dry up in recent months. Average selling price increased 14.5% year-over-year to $902,680.

– TRREB: 8,012 homes sold across GTA in March, marking 12.3% increase from 2019. Of those sales, 4,643 registered in first half of the month, marking 49% jump. In second half of the month, sales were down almost 16% from the back half of March 2019.

– Point2 Homes Poll: One in five Canadians will begin looking for new homes again only after the COVID-19 crisis is over. 44% are still confident in the housing market. 29% admitted they are bracing themselves for noticeable delays in every step of the home purchasing process.

 
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.

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