Housonomix - 5 Jan 2024: 🌟 New Beginnings: Rate Dynamics, GTA Growth, and Smart Mortgage Strategies in 2024's Economic Landscape 🏡💼📉

🎊Rate Watch: A New Year’s Dip📉and Rise📈!

As we embrace 2024 with renewed energy and optimism, let's dive into the latest mortgage rate trends that are shaping up the Canadian housing market. Here's your Rate Watch update for the 5th of January:

🏠 Insured Mortgages (<20% downpayment): A Slight Reprieve

• The 3-year fixed rates have dipped a notch to 5.39%, down by 0.10% 📉.

• The 5-year variable rates remain steady at 6.10%, with no change from last week ➖.

🏦 Uninsured Mortgages (>$1 million purchase, Refinances): A Mixed Bag

• A not so subtle decrease for the 3-year fixed rates, now at 5.94%, showing a 0.20% decrease 📉.

• On the flip side, the 5-year variable rates have inched up by 0.15%, now at 6.85% 📈.

💼 Flexible Lenders: Stability Continues

• The 2-year fixed rates hold firm at 6.89%, unchanged and stable for those seeking flexibility ➖.

🔑 Private Lenders: Steady as She Goes

• For the niche corner, the 1st mortgage rates stand unchanged at 8.99% for those requiring minimal income and credit requirements ➖.

The overall landscape presents a promising start to the year, with a general downtrend in rates, giving a slight edge to borrowers. The only exception lies with the uninsured 5-year variable rates, which have seen an increase 🧐.

As we always mention, please remember these are starting rates. To get your (or your client’s) custom rates, it’s best to reach out to us at www.ronmortgages.com to get rates which will be for your unique scenario and can be lower than rates quoted here. 🌟

📡 Real Estate Radar: December 2023 GTA Market Review

As we reflect on December 2023, the GTA housing market has demonstrated resilience despite headwinds, ending the year on a solid footing. December 2023 sales were the highest in the last 8 months, mainly due to falling mortgage rates. Inventory build up however resulted in prices dropping for the 5th continous month. Here are the Dec 2023 sales and price data:

🏠 Detached Homes

• Sales: A total of 1,521 homes sold, reflecting a 13.6% increase YoY.

• Price: The average price slightly adjusted to $1,418,323, marking a 2.5% increase YoY.

🏘️ Semi-Detached

• Sales: There were 324 sales, a substantial 36.7% jump YoY.

• Price: Average prices grew to $1,027,432, a 1.7% rise from December 2022.

🏢 Townhouses

• Sales: A total of 623 transactions occurred, up by 25.3% YoY.

• Price: The average price increased to $912,403, which is a significant 5.5% boost YoY.

🏡 Condo Apartments

• Sales: Saw 944 sales, a decrease of 4.1% YoY.

• Price: The average price was $682,525, showing a 3.1% decline YoY.

Overall, the market saw a total of 3,444 property transactions in December, an 11.5% rise in sales activity from the same month in the previous year. This positive trend, coupled with an overall increase in property values—with the notable exception of condo prices slightly softening—highlights a dynamic market landscape.

Stay tuned as we cover the data and bring our insights from more areas outside of the GTA in subsequent editions of Housonomix.

🎉 Success Spotlight: Escaping the High-Interest Debt Cycle with a Tailored Second Mortgage Solution 🎯 🎉

In this edition of Housonomix Success Spotlight, we’re toasting to the triumph 🥂 of clients who have skillfully navigated out of the high-interest debt cycle into calmer financial waters, all through a bespoke mortgage strategy crafted by Ron Mortgages.

🔑 Key Achievements:

• Transition from high-interest debts to a savvy financial plan 🔄.

• Secured a private second mortgage with competitive rates, beating traditional lending options 💼.

• Chose interest-only payment structure to enhance cash flow efficiency 💡.

• Achieved swift closing times, with the lender generously covering legal and appraisal costs 🕒.

Our clients’ journey began in a sea of high-interest debts, but with resilience and the right help from www.ronmortgages.com, they have on their way towards a brighter monetary future. A strategic private lending solution was the lifebuoy that brought them back to shore, offering rates that significantly reduced their financial strain.

The endgame? A second mortgage with lower rates than ever before, offering substantial interest savings 💸. The clients' smart choice for interest-only payments ensures their cash reserves remain buoyant, a strategic move in today’s economic currents.

But the voyage to success was not just about the destination; the swift closing and the lender’s gesture to handle the legal and appraisal fees added to the smooth sailing of this financial journey 🚤.

At www.ronmortgages.com, we believe in crafting a financial strategy as unique as your own fingerprint. This Success Spotlight is a testament to our dedication to finding you a mortgage solution that fits like a glove 🧤. If high-interest debts are raining on your financial parade, let us help you with a tailored mortgage strategy ☔.

Reach out to Housonomix for a personalized strategy to capitalize on the market.

📞 Get in touch at 647 779 1901 or visit www.ronmortgages.com to explore what we can achieve for you.

🍁 Maple Pulse: 🌊 Shifting Economic Tides: 📉 Rate Adjustments and 🏡 Real Estate Dynamics in 2024"

In today’s Maple Pulse which focuses on pivotal developments affecting both the real estate sector and the broader economic outlook, we’re watching the cautious steps of the US Fed and the Bank of Canada, changes in real estate legislation and market dynamics. Let’s look into these and our insights.

• Deloitte Foresees Economic Growth and Rate Cuts for Canada in 2024: Deloitte Canada forecasts economic growth in the second half of 2024 for Canada, with potential interest rate cuts starting as early as spring. Despite a possible technical recession in the first half, the Canadian economy is not expected to experience a severe decline or labor market crisis. The Bank of Canada, currently maintaining a 5% interest rate, may start reducing rates once inflation, still high at 3.1%, aligns closer to the 2% target. The outlook for consumer spending and the labor market remains cautious, with anticipated subdued consumer activity in the first half of 2024 and a gradual pick-up towards 2025. This forecast indicates a slow yet positive shift in Canada's economic landscape.

• Soaring Rents Impacting Bank of Canada's Interest Rate Decisions: Rising rent inflation in Canada, at 7.4% in November, is a significant factor in the consumer price index, influenced by immigration and housing shortages. Despite rent controls in Ontario, Quebec, and British Columbia, significant increases occur when tenants change, often reaching 20-25%. This turnover-driven rent hike is expected to contribute to a sustained high rent inflation, averaging 5.7% in 2024 and 4.3% in 2025. This trend, higher than pre-pandemic averages, may prompt the Bank of Canada to maintain elevated interest rates to manage inflation.

• Ontario's New Real Estate Act - A Step Towards Transparency but Falls Short: The Trust In Real Estate Services Act (TRESA) in Ontario, which aims to enhance professionalism and consumer protection in real estate, only partially addresses key issues like open bidding and sales commissions. TRESA allows for 'designated representation' and optional disclosure of bid details at the seller's discretion, not fully resolving the problem of blind bidding in real estate transactions. The act also touches upon controversial sales commission practices, requiring clearer communication about commission payments but still leaving some buyer and seller concerns unaddressed. While TRESA represents progress towards greater transparency, it may not fully meet the expectations for reform in the real estate industry.

• Canadian Economy Over-Reliant on Real Estate, Risks Intensifying: Canada's economy shows alarming reliance on real estate, with residential investment reaching 7.8% of GDP in Q3 2023, surpassing the U.S. at its 2006 housing bubble peak. This concentration, primarily driven by new housing construction and associated costs, raises concerns of non-productive speculation and inefficient capital allocation. Despite some progress post-pandemic, recent policies favor further real estate investment, potentially amplifying risks and limiting economic diversity. This trend places Canada last in the OECD growth forecast, signaling potential long-term risks and reduced opportunities, especially for younger demographics.

• US Federal Reserve Cautious on Rate Cuts Amid Cooling Inflation: The Federal Reserve, noting eased inflationary pressures and a cooling job market, maintained its key interest rate and signaled potential rate cuts by the end of 2024. While progress is made towards the 2% inflation target, Fed officials emphasize the need for vigilance, not ruling out further rate hikes. The U.S. economy remains resilient, with a 4.9% annual growth rate and a robust job market, despite predictions of a recession. This scenario presents a hopeful outlook for achieving a 'soft landing'—reducing inflation without triggering a recession.

Hopefully our coverage of the major real estate and economy related events helps you get a clearer understanding and helps in making informed decions. Stay tuned as we expand and explore to bring you the latest and most relevant economic and housing insights.

Mortgage Mastery: Understanding Payment Frequency and Interest Savings 🏡💰

Welcome to this edition’s Mortgage Mastery! Today, we're delving into the topic of payment frequency options for mortgages 📆. Understanding these options is crucial, as they can significantly impact your interest savings over the life of your loan 💸. Let’s break down the most common payment frequencies:

• Monthly Payments 🗓️: This is the standard payment frequency. You make 12 payments per year. It’s straightforward and aligns well with most people’s monthly income schedules.

• Semi-Monthly Payments 🗓️➗: Here, you pay half of your monthly mortgage payment twice a month, resulting in 24 payments a year. This can slightly accelerate your mortgage payoff and save a bit on interest, as you're reducing your principal more frequently.

• Biweekly Payments 📅: With this option, you make a payment every two weeks, totaling 26 payments a year. This effectively results in one extra monthly payment annually, which can reduce your principal faster and lead to noticeable interest savings.

• Accelerated Biweekly Payments 📅💨: Similar to biweekly, but you pay a bit more. Essentially, you take your monthly payment, divide it by two, and pay this amount every two weeks. Over a year, this adds up to 13 full monthly payments instead of 12, accelerating your mortgage payoff and increasing your interest savings.

• Weekly Payments 📅🔍: This involves making a payment every week, leading to 52 payments a year. It’s a more frequent payment schedule that can slightly reduce your interest costs.

• Accelerated Weekly Payments 📅🔍💨: Similar to the weekly option, but like the accelerated biweekly, you end up making an equivalent of one extra monthly payment each year. This is one of the fastest ways to decrease your principal and save on interest.

Impact on Interest Savings

• Long-term Savings 💸⏳: Accelerated payment options (both biweekly and weekly) can shave years off your mortgage and save you a significant amount in interest. This is because you're reducing your principal balance faster than with traditional monthly payments.

• Budgeting 💹: Monthly and semi-monthly payments may be easier to budget for, but accelerated options offer greater long-term financial benefits.

• Flexibility 🔀: Some people prefer the regularity and simplicity of monthly payments, especially if their income is structured this way. However, for those who can manage slightly higher payments more frequently, accelerated options are financially advantageous.

In conclusion, while traditional monthly payments might be more straightforward, opting for accelerated payment frequencies can lead to substantial interest savings over the life of your mortgage 🏠💵. It’s always recommended to consult with a mortgage professional (www.ronmortgages.com😁 ) to understand which option aligns best with your financial situation and goals.

Stay tuned for next edition’s Mortgage Mastery, where we’ll explore another key aspect of mortgage management! 🌟📘

Chuckles & Triumphs 🍏🍾🎯

Embracing Life's Journey from Juice Cleanses to Toasting Dreams 🤣🥤➡️🏅💡