Blog

June 30th, 2020 Mortgage Industry Update

The Bank of Canada announced on June 3rd that its overnight lending rate will remain at 0.25%. The prime rate remains 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:
– Borrowell survey: 35% of Canadians have missed at least one bill payment since COVID-19, 68% of delinquencies stemming from lack of funds. 53% burdened with anxiety about their finances, and 63% said that they were stressed by the prospect of paying their bills this summer.

– TransUnion: Gen-Zers, millennials are most affected by COVID-19, finding that 21% and 16%, respectively, have temporarily shelved their plans to enter homeownership. Only 8% of Gen-Xers and 6% of boomers effected. Overall 12% of Canadians have delayed their new home transactions.

– CREA: Sales of Muskoka waterfront properties numbered 188 units in May 2020. Down just 1.1 % (literally two sales) from May 2019. Though waterfront sales decreased 10.8 % from 2019 on a year-to-date basis in 2020, the data suggests eyes began to turn to cottage country by May.

– BILD: COVID-19 related construction delays will make Toronto’s housing shortage worse by stalling up to 9,000 housing starts and the occupancy of another 8,000 in the next 18 months. A third of housing projects are behind schedule by six months or more.

– Parliamentary Budget Officer: Top 1% (159,300) of Canadian families have a net asset base of $6.1M. Top 0.1% (16,000) have at least $29.3M in net assets. Top 0.01% of families (1,600) have $143.1M. Together they own $3T in assets, just over 25% of Canada’s total household wealth.

– Statistics Canada: Inflation rate fell 0.4% on a year-to-year basis in May, as cheaper gasoline prices pushed inflation below zero for the second month in a row after a 0.2% drop for April.

 
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.