Housonomix - 15 Sept 2023: 📉 Steady Rates & Market Shifts: GTA Real Estate Deep Dive, 🏙️ Mississauga Condo Spotlight & 🛠️ Credit Score Secrets for Mortgages

Rate Watch 📊

Rates have largely held steady or dropped slightly as some lenders try and cash in on Bank of Canada’s welcome pause in hiking from earlier this month. Check out the link above for a more broader rate sheet at the Ron Mortgages website.

In the future we’ll bring in more insights into rates including periodic changes and the reasons, what mortgages are most popular with borrowers and ongoing offers from lenders. Let us know if you want anything else added!

Real Estate radar 🏡📡

Parsing TRREB’s Aug 2023 data, the key points that stand out are

• The average home in the GTA costs $1,082,496 a 0.3% YoY increase but a 3.2% MoM decrease

• The property type that gained most was the semi-detached with a 7% YoY increase, while condos fell by 0.8% over the same time period.

• Of these two types what’s interesting is that the number of transactions of semi-detached fell by a whopping 15.2% YoY, while for condos they increased by 6.8%

• What this shows to us is that while semi-detached properties are becoming scarcer or pricier (or most likely both), this just might be a good time to snap up a condo. Current renters, first time buyers, investors we’re looking at you. Speaking of it being a good time to snap up a condo check this out…. 👇

Featured Listing 🏡✨

Today’s featured listing is: MLS# W6673874

Check out this 2+1 BR condo apartment in the heart of Mississauga, available at an incredible value. It’s listed by one of our fantastic realtor partners.

(If you’re selling/listing a property and would like it featured here please reach out to us at [email protected].)

Maple Pulse: Housing & Economic insights 🍁📈

• In recent days, the Bank of Canada's decision to hold interest rates has ‘sparked’ speculation about the future of rate hikes, to put it mildly.

  • Our perspective: We're likely nearing the peak, or at the peak of the rate hike cycle. Translated: even if rates rise further, it may not be by much.

  • Our advice: While rate drops soon would be positive, it's wiser not to rely on it and make highly risky bets based on it. We recommend planning for the likelihood of sustained high rates instead of immediate decreases.

• What we’re watching - two words: oil prices. Their decrease from last summer’s high contributed to lowering of inflation, but thanks to production cuts by the Saudis and the Russians, prices have steadily climbed and they’re up over 33% in less than 3 months!

  • Why this matters: Oil prices affect most goods and services, influencing inflation indirectly. Although core inflation excludes energy and food prices, the Bank of Canada will be watching oil, like a hawk. And, we like to watch whatever the Bank of Canada watches 😉 

   

  Stay tuned: Our newsletter will continue to cover essential economic indicators and global events that impact mortgages and your financial well-being.

Mortgage Mastery 🏠💼

In this section we offer tips for getting best deals on every kind of mortgage there is, address common concerns surrounding real estate and mortgages and share real estate and wealth building strategies. Today, we’re covering something basic: credit scores.

What is a Credit Score?

A credit score is a three-digit number that summarizes your creditworthiness. It's calculated based on your credit history, which includes your credit card payments, loans, and other financial activities. This number serves as a quick snapshot for lenders, helping them evaluate the risk associated with lending you money.

The Components of a Credit Score:

1. Payment History (35% weightage): This is the most critical factor. It shows whether you've paid your bills on time. Late payments can negatively impact your score.

2. Credit Utilization (30% weightage): This measures the percentage of your available credit you're using. Keeping your balances low relative to your credit limits (<30%) is a good practice.

3. Credit History Length (15% weightage): A longer credit history can have a positive impact. It demonstrates your ability to manage credit over time.

4. Credit Mix (10% weightage): Having a mix of credit types, such as credit cards, installment loans, and mortgages, can be beneficial.

5. New Credit (10% weightage): Opening multiple new credit accounts in a short period can lower your score temporarily.

Why Your Credit Score Matters for Mortgages:

Lenders use your credit score to determine the interest rate you qualify for on a mortgage. A higher credit score lowers your risk profile to a lender, which lets them offer you lower interest rates, potentially saving you thousands of dollars over the life of your loan.

This is also why it’s impossible to answer questions like “Can you get me a better rate than x%?” without doing a full application including a credit check.

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