October 27th, 2020 Mortgage Industry Update

The Bank of Canada announced on September 9th that its overnight lending rate will remain at 0.25%. The prime rate remains 2.45%. The Bank of Canada has openly stated that it will more than likely keep rates at this “effective lower bound” for the immediate future until the effects of the pandemic are more clear.

Additionally this week:
– Pollara Strategic Insights survey: 56% of participants said they would seek help from family as they geared up to purchase their first home. Millennials more likely to search for financial assistance than Gen X. 23% of them expecting $100,000 or more in financial support.

– A new report by TD Banking Group notes that 11 out of 15 industries in Canada saw employment numbers in September closer to pre-pandemic levels, while utilities, education, and professional, scientific and technical services recorded full recoveries.

– Statistics Canada: Inflation went up in September by 0.5% compared with a year ago. Economists had, on average, expected a year-over-year increase of 0.4%, according to financial data firm Refinitiv, following readings of 0.1% increases in August and July.

– CREA: Sales in Ontario were 41.9% higher in September than they were in 2019. This is the first time sales for the month surpassed 25,000. Year-to-date sales were up 2.7%. The average resale selling price in Ontario was $741,395 in September, a 19.7% increase.

– The average price of a home sold on the Canadian Real Estate Association’s MLS service went for $604,000 in September, an all-time record and an increase of more than 17% in the past year. Was the busiest September ever in terms of the volume of homes sold.

– Finder market report: 47% of economists indicated a belief that the Bank of Canada would keep the interest rate on hold until at least 2023. 13% said the rate hold will last even beyond this period. 40% said will hold for just two years. 13% predicting rate movements after 2021.

 
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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