July 25th, 2017 Mortgage Industry Update

The Bank of Canada announced on July 12th that it’s overnight lending rate will increase from 0.50% to 0.75%. The prime rate at almost all institutions has increased from 2.70% to 2.95%, the first increase in 7 years. Fixed rates have slightly risen over the last 3 weeks and seem to have stabilized now.

Additionally this week:
– The Bank of Canada increases qualifying interest rate on variable rate mortgages and 1-4 year terms to 4.84%, from 4.64%.

– Canadian Bankers Association: Ontario’s mortgages in arrears (90+ days) down by 18.4% year-over-year in April. Represents 0.11% of all mortgages.

– CMHC: Last year saw approximately 1.03 million new mortgage loans at a total of about $269B, which represents a 9% year-over-year increase.

– Chinese investors have spent over US$100B on overseas property investments in 2016, and Canada proved to be 1 of 5 favourite destinations.

– CREA: National home sales fell 6.7% in June, largest month-over-month drop since June 2010. Average price up 0.4% year-over-year to $504,458. Prices dropped 6.2% one month after the announcement of Ontario’s housing plan and 13.8% a month later. Prices up 6.3% year-over-year.

– CIBC: The recent drop in the number of home sales in the GTA (down 37.3% in June from 2016) is not expected to last long-term.

 
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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