January 26th, 2021 Mortgage Industry Update
The Bank of Canada announced on January 20th that its overnight lending rate will remain at 0.25%. The prime rate remains 2.45%. The Bank of Canada suggests that they will more than likely keep rates at this “effective lower bound” until 2023, as they observe the full effects of the pandemic.
Additionally this week:
– Bank of Canada stands still on the overnight rate at 0.25%. Good news for variable rate mortgage holders as there is no expected change in prime rates!
– In its latest housing market forecast, RBC Economics predicted that the national benchmark price will grow by 8.4% to reach $669,000 this year. Home resales across the country are projected to increase by 6.5% to 588,300 units, with almost all provinces expected to show gains.
– StatsCan: Toronto, Montreal and Vancouver saw a sharp jump in number of citizens moving to suburbs, smaller towns and rural areas. Total of 87,444 people left between July 2019 and July 2020 for other parts of province, up from average annual exodus of 72,686 the previous 3 years.
– Statistics Canada: Value of residential building permits nationwide increased by 34% annually, with BC’s home construction sector leading the charge. Rising to a total of $6.4 billion in November, total value grew by 10% monthly, breaking previous record set in September 2020.
– Bank of Canada Canadian Survey of Consumer Expectations (Q4 2020): On average, consumers are anticipating a 4.98% increase in home prices in the next 12 months. This represented a marked increase from the 4.67% expectation during the third quarter.
– Statistics Canada said that the economy shed approximately 63,000 jobs in December, a worse-than-expected loss and the first decline in overall employment since April. Canada’s unemployment rate rose as well last month, to 8.6 per cent, up from 8.5 per cent in November.
Stay tuned for the next update!
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