May 5th, 2020 Mortgage Industry Update

The Bank of Canada announced on April 15th 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:
– New data from TD Bank suggests home prices in Toronto may increase by nearly 8% in the remainder of 2020, in light of the current state of both the economy and the real estate market. Home sales in Canada will remain below their pre-COVID-19 levels for the rest of 2020.

– Zoocasa: From March 16 – April 15, 2020, compared to 2019, average home prices in Peel region grew 6% to $800,025. 8% in Brampton to $768,710. 7% in Mississauga to $819,096. Sales dropped 59% across the Peel region in response to the novel coronavirus outbreak.

– Statistics Canada: Toronto’s unemployment rate stood at 7.8% as of March, having grown 11.42% annually. Meanwhile, Vancouver saw its share of unemployed workers shoot up by 68.89% year-over-year to reach 7.6%.

– Statistics Canada: Preliminary estimate for industry GDP points to a shocking 9% decline in economic activity in March from February. During the Great Recession, the deepest one-month drop was 1.4% in December 2008. Marks an annualized contraction of about 10% for Q1.

– Realosophy Realty: After two straight weeks of year-over-year growth in Toronto home sales taking greater than -70% hits, the week of April 18-25 saw ‘just’ a -57% drop. New listings were also down 63% year-over-year last week, which is roughly on par with the previous two weeks.

– BILD: 3,730 total new home sales reported in GTA for March, up 67% from 2019, and 7% above the 10 year average. 2,840 condos sold, up 108% from 2019 and 30% above 10 year average. Prices for new condos up 25.9% to $983,133, new single-family home prices down 0.1% to $1,115,869.

 
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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