Housonomix - Nov 24, 2023: Enduring Markets and Strategic Moves: Canada’s Real Estate Stability and Policy Dynamics

🔍 Rate Watch update📉 - Stability Reigns

The theme in this week’s rate update is: Consistent Rates. As you can see, this week's mortgage rates are holding steady, providing a sense of security in your home financing plans.

• Mortgages with Prime Lenders:

  • Insured Mortgages: A 3-yr fixed at 5.84% and a 5-yr variable at 6.10% for those with less than 20% down.

  • Uninsured Mortgages: Refinancing or high-value property buyers see a 3-yr fixed at 6.44% and a 5-yr variable at 6.70%.

• Adaptable Lending: Flexible lender rates are unchanged, with a 2-yr offer at 6.89%, perfect for varying income and credit histories.

• Private Lending Options: For unique situations, private lenders' rates for a 1st mortgage are stable at 8.99% up to 80% LTV.

Now remember, these figures represent starting rates and may (and usually do) adjust based on individual profiles 📝.

Customized Rates Tailored for You Every financial journey is different. Contact us to explore your personalized rate options that reflect your specific needs and goals 🌟

🍁 Real Estate Radar🏡📡: Canadian Market Overview - October 2023 🍁 

In this week’s Real Estate Radar we’re delving into the latest trends and numbers from the Canadian housing market, highlighting key developments across the country.

• National Overview: Canada's real estate market remains balanced with a steady increase in average home prices to $656,625, showing a 2% year-over-year and a 0.2% month-over-month rise.

• British Columbia: Leads with the highest average home price of $968,786, marking a 4% year-over-year increase. Greater Vancouver's average home price is $1,299,503, up 5.5% from last year.

• Alberta: Exhibits strong growth with an average home price of $455,891, a 6% increase year-over-year. Calgary's market shows a notable 7% rise year-over-year.

• Ontario: Despite being a buyer's market, the average home price rose to $855,990, a 3% increase from last year. The Greater Toronto Area (GTA) saw a 3% year-over-year increase in average home prices.

• Other Provinces: Saskatchewan and Manitoba show moderate growth, with respective year-over-year increases of 4% and 2%. Nova Scotia and New Brunswick have dynamic seller's markets, with significant month-over-month increases in home prices.

Our take: Despite the constant doom and gloom in the media about housing, the economy and everything else, for a minute let’s filter out the noise and take a step back. Now based on the data one can observe the resilience and growth of real estate across Canada and particularly in key regions such as Ontario, British Columbia and Alberta. Despite regional variations, the overall stability and gradual price increases does suggest a healthy real estate market. For those considering entering the market or refinancing, now could be an opportune time to explore options, keeping in mind the unique dynamics of each province. As always, we're here to provide tailored mortgage solutions that align with these evolving market trends.

🎉 Success Spotlight: Home Refinance Triumph 🎉

🌟 Success Spotlight: A Multi-Million Dollar Refinance Victory 🌟

We're proud to announce a standout achievement: a complex million dollar refinance for our savvy investor clients despite a challenging real estate environment. This deal showcases our ability to secure competitive rates and navigate the intricate financial scenarios that come with substantial property portfolios.

Highlights of the Deal:

• Managed varied income from multiple countries.

• Overcame challenges within an extensive real estate portfolio.

• Secured a prime lender agreement with favorable terms.

Your Opportunity: Inspired by this success? Let's discuss how we can unlock your property's potential. 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 🍁📈: 🏠 AirBnB Tax Changes 📊, Mortgage Relief 💸, Inflation Trends 📉 Reshaping Canada's Housing

In this week's roundup, as always we dive into factors affecting the dynamic world of Canadian real estate and mortgages. From government measures reshaping the landscape of short-term rentals 🏖️ to substantial mortgage relief initiatives 💰, we've got all the latest updates that matter to you. Let's unpack the significant changes and trends affecting homeowners, renters, and investors across Canada. Stay informed and ahead of the curve with our concise and insightful analysis. Let's get started!

• New Tax Measure Targets Airbnb and VRBO: Effective January 1, 2024, the Federal government announced a tax measure impacting hosts on platforms like Airbnb and VRBO. Hosts in areas where short-term rentals are prohibited or non-compliant with local laws can no longer claim expenses against rental income. This is part of the government's effort, including a $50 million investment over three years, to enforce restrictions and address the housing affordability issue by reducing the growth of short-term rentals. While the policy aims to increase long-term rental availability, experts like Stephen Brown and Robert Hogue express skepticism about its significant impact on housing affordability, especially amidst strong immigration and labor demands.

• Federal Government's Mortgage Relief Initiatives: The federal government's fall economic update, announced by Finance Minister Chrystia Freeland, introduces a suite of housing affordability measures. Key initiatives include a new Canadian mortgage charter offering relief for financially strapped homeowners, allowing some borrowers to bypass the mortgage stress test when switching banks. Additionally, over $38 billion is committed to building and repairing homes, including more than 71,000 new rental homes and 60,000 affordable homes. However, economists and industry players view these as initial steps that may not immediately impact the housing affordability crisis in Canada.

• Government Spending Impact on Mortgagors: A detailed analysis by Scotia Bank reveals that government consumption and pandemic transfers significantly influenced the Bank of Canada's policy rate, accounting for about 200 basis points of the 475 basis points increase. This rise reflects increased government spending since 2019 and federal support during the pandemic. Provincial spending alone contributed a third of the policy rate increase, indicating the substantial role of fiscal policy at all levels in shaping Canada's current monetary landscape. The report suggests that, while necessary in some aspects, this spending was misaligned with inflation control, leading to higher interest rates and complicating monetary policy management in Canada.

• Record Rise in National Property Taxes and Rental Inflation: According to Statistics Canada, October saw the highest annual increase in national property taxes since 1992, driven by municipalities needing larger budgets to cover rising costs. This contributed to upward pressure on overall inflation, despite a slowdown in the headline rate. Rental price inflation also saw significant growth, rising 8.2% year-over-year nationally in October. Notably, Nova Scotia and Alberta experienced the largest rent price increases, with 14.6% and 9.9% respectively. This aligns with findings from a Rentals.ca and Urbanation report (that we covered in last week’s Housonomix), which noted that the average asking price for rental units in Canada reached $2,178 in October, marking a 9.9% year-over-year increase and continuing a six-month trend of record-high asking rents.

• Canada's Inflation Slowdown Opens Door to Rate Cuts: Recent data from Statistics Canada indicates a slowdown in inflation, with the consumer price index rising only 3.1% in October, the slowest pace since June. This deceleration, driven primarily by lower gasoline prices and partially offset by higher costs in services like travel and rent, signals the potential effectiveness of the Bank of Canada's rate hikes. Core inflation measures, closely monitored by the Bank, also showed a decrease. The Bank of Canada, maintaining interest rates at 5%, anticipates achieving the 2% inflation target by the second half of 2025. This development may influence the upcoming rate decision on December 6, with a majority of economists expecting rates to remain unchanged.

🔍 In Conclusion 🔑

As we navigate through these shifting sands of the Canadian housing market, it's clear that both challenges and opportunities lie ahead. From the halls of government to the streets of our neighborhoods, the impact of these changes will be felt by all. 🏘️ Whether you're bracing for higher property taxes or optimistic about potential rate cuts, staying informed is crucial. Remember, the world of real estate is ever-evolving, and we're here to keep you updated every step of the way! Until next week, stay savvy and keep your pulse on the market with Housonomix! 🌟

Mortgage Mastery: Understanding Portability and Assumability 🏡🔑

In this week's Mortgage Mastery, we delve into two key features that can add flexibility to your mortgage: portability and assumability. Understanding these options can provide significant benefits during the life of your mortgage.

1. Portability: Moving Your Mortgage with You 🚚

Portability is a feature that allows you to transfer your existing mortgage to a new property while maintaining the same terms and conditions, including your interest rate. This can be particularly beneficial if your current rate is lower than the market rate.

• Advantages: Saves you from paying the prepayment penalty for breaking your mortgage contract 🛡️. Ideal for those relocating due to work or family needs 🏠➡️🏠.

• Limitations: The new property must meet your lender’s criteria, and there might be restrictions on the mortgage amount and type 📋.

2. Assumability: Passing the Baton 🤝

Assumability lets a new buyer take over your mortgage under its existing terms. This can be an attractive selling point, especially in a rising interest rate environment.

• Benefits: For sellers, it can make your property more appealing 🌟. Buyers benefit from potentially lower rates and fewer closing costs 💰.

• Considerations: The buyer must qualify for the mortgage under the lender’s criteria. Not all mortgages are assumable, so it’s important to check with your lender 👀.

Key Takeaways:

• Check Your Mortgage Terms: Not all mortgages are portable or assumable. It's crucial to understand your mortgage agreement or consult with your lender 📄✅.

• Assess Your Needs: Whether you’re considering moving or selling your property, knowing your options can lead to more informed decisions 🤔💡.

For more insights into how portability and assumability can impact your mortgage strategy, feel free to reach out for personalized advice. Stay tuned for more mortgage insights in our next edition! 🌐📊

Smiles & Wisdom 😄📚💡