A chain of possible mortgage rate increases in the very near future might endanger Canadian would-be home buyers’ purchasing power – and ultimately, their mortgage capacity, according to the Canada Mortgage and Housing Corporation.
Month: November 2018
“[The Canadian Real Estate Association] will release the full set of October housing market data [this week], and the overall picture will continue to look stable/subded,” writes Kavcic. “National sales are estimated to be down 6 percent year-over-year, slightly improved from September’s 8.9 percent year-over-year decline.”
“We must avoid at all costs what is happening in Vancouver and Toronto, where 90% of projects are sold to investors. Montrealers must be able to own their own city,” Laurence Vincent, co-president of development company Prevel, said in an interview with Montreal-based markets observer Yury Shupilov.
Preliminary housing starts data for October 2018 are pointing to a national market that is steadily slowing down due to pressure from various factors, according to the Canada Mortgage and Housing Corporation (CMHC).
“The national trend in housing starts declined for a fourth consecutive month in October, which leaves the trend at its lowest level since February 2017,” CMHC chief economist Bob Dugan stated in the starts report.
The Bank of Canada has been hiking interest rates all year, and Canada’s big banks have been raising mortgage rates accordingly. The result? A nationwide deterioration in housing affordability, according to a new report from Desjardins.
The Canadian housing market will see activity moderate over the next two years, according to the latest forecast from the Canada Mortgage and Housing Corporation (CMHC).
The federal housing organization is predicting a flattening of sales and prices in 2019, with the average national home sale price coming in somewhere between $501,400 and $521,600.
“When sales-to-new listings ratios per neighbourhood fluctuate, it hits some neighbourhoods first,” explained John van Oosterhout, director of partnerships at Value Connect. “Higher-end neighbourhoods are usually affected first, as are neighbourhoods with a high number of investment properties.”
The recent interest rate hikes along with the implementation of tighter mortgage rules have moderated the risk of debt for a growing number of borrowers, according to a Bank of Canada research note released last week.
“Many of the rule changes over the past 10 years have made it really hard to buy a home beyond your primary residence,” he said. “This rule change is focused squarely on that. It has no effect on your owner-occupied residence, but will make it more difficult to purchase a second home or rental property. Many clients will be forced to choose between the security of having a credit facility should they require it, and purchasing that second property.”
A quarter of Canadians are in subprime or near-prime credit categories, which is adding to their fears of checking their credit score.
While 96% say they believe a good credit score is important, just 41% know theirs according to a Leger poll for Refresh Financial, a FinTech which helps Canadians with their credit history.
Canadian homebuyers are increasingly looking for cheap alternatives to the pricey Toronto housing market. One contender that has emerged in recent months? Ottawa, which has seen activity gain momentum throughout 2018.
A series of policy changes has cooled Canadian home price growth, while eating into the budgets of would-be homebuyers. How is this affecting housing activity this month? Livabl has rounded up the latest industry commentary to keep you in the know.
Mortgage rules implemented over the past two years, along with rising interest rates, have worked to improve credit quality and reduce the number of highly indebted borrowers in the market.
The Canadian housing market hasn’t provided much of a boost to the country’s economy in 2018 and, according to one bank, it’s a trend that will likely continue in the new year.
Housing starts have been slowing in recent months, which CIBC economist Royce Mendes believes is a sign that the market will exert a drag on the Canadian economy in 2019.
Despite rising housing costs, eight out of ten young, urban families in Canada’s key metropolitan areas would prefer to live in a detached single family home if money was no object. This was one of the main highlights in a recent report released by Mustel Group and Sotheby’s International Realty Canada on home ownership trends among modern families.
Mortgage professionals from across Canada descended on Montreal last weekend for the annual National Mortgage Conference.
Hosted by Mortgage Professionals Canada, the annual gathering was once again well attended, with about 1,200 participants and 60+ exhibitors at the Exhibitor Expo.
The two-day event featured a mix of educational sessions, industry updates, networking events and keynote speakers.
The majority of young Canadian families would prefer to live in a single detached home, but many have given up on the dream of ever being able to buy one.
In fact, 43 percent of families surveyed in a recent report from Sotheby’s International Realty Canada said that high detached home prices meant they had to settle for higher density housing.
“We continue to enjoy solid business results this year, with another low loss ratio of 14% for the third quarter,” said Stuart Levings, President and CEO. “While housing markets continue to normalize, they are generally well balanced, and employment remains strong, which is positive for our longer term business performance. As part of our ongoing focus on capital efficiency, we are pleased to have completed another $50 million share buyback under our normal course issuer bid during the quarter, underscoring our view that business fundamentals remain strong.”
Exceeding even optimistic estimates, Canadians’ demand for recreational marijuana in the wake of the October 17 legalization has reached stratospheric heights – enough for major producers and sellers to struggle hard to keep up.
According to the Ontario Cannabis Store, it received 100,000 orders in just the first 24 hours of its operation.
The third quarter of 2018 brought some warmth to the Canadian housing market, as both sales and prices began to inch upwards after months of
Amid a spate of interest rate hikes and increasing cautiousness among borrowers, market players and analysts are sounding the alarm on a possible upward spike