August 2024 Newsletter

General Angela Calla 27 Sep

Welcome to the August issue of my monthly newsletter!
I hope you’ve had a fantastic summer so far! This month, I am excited to give you some tips on paying off your mortgage faster. Plus, learn my favourite ways to cut energy costs and save. Scroll down for all the details and have a great month!

How to Pay Off Your Mortgage Faster

When it comes to homeownership, many of us dream of the day we will be mortgage-free. While most mortgages operate on a 25-year amortization schedule, there are some ways you can pay off your mortgage quicker!

Did you know? There are a few ways you can help pay off your mortgage faster

For example – switching to an accelerated bi-weekly payment schedule, increasing your monthly mortgage payments to pay more to the principal, making extra payments on your mortgage, negotiating a better rate, or refinancing to a shorter amortization period!

Let’s take a look at the options and how they work:

  1. Review Your Payment Schedule: Taking a look at your payment schedule can be an easy way to start paying down your mortgage faster, such as moving to an accelerated bi-weekly payment schedule. While this will lead to slightly higher monthly payments, the overall result is approximately one extra payment on your mortgage per calendar year. This can reduce the total amortization by multiple years, which is an effective way to whittle down your amortization faster.
  2. Increase Your Mortgage Payments*: This is another fairly simple change you can execute today to start having more of an impact on your mortgage. Most lenders offer some sort of pre-payment privilege that allows you to increase your payment amount without penalty. This payment increase allowance can range from 10% to 20% payment increase from the original payment amount. If you earned a raise at work, or have come into some money, consider putting those funds right into your mortgage to help reduce your mortgage balance without you feeling like you are having to change your spending habits.
  3. Make Extra Payments*: For those of you who have pre-payment privileges on your mortgage, this is a great option for paying it down faster. The extra payment option allows you to do an annual lump-sum payment of 15-20% of the original loan amount to help clear out some of your loans! Some mortgages will allow you to increase your payment by this pre-payment privilege percentage amount as well. This is another great way to utilize any extra money you may have earned, such as from a bonus at work or an inheritance.
  4. Negotiate a Better Rate: Depending on whether you have a variable or a fixed mortgage, you may want to consider looking into getting a better rate to reduce your overall mortgage payments and money to interest. This is ideally done when your mortgage term is up for renewal and with rates starting to come back down, it could be a great opportunity to adjust your mortgage and save! This may be done with your existing lender OR moving to a new lender who is offering a lower rate (known as a switch and transfer).
  5. Refinance to a Shorter Amortization Period: Lastly, consider the term of your mortgage. If you’re mortgage is coming up for renewal, this is a great time to look at refinancing to a shorter amortization period. While this will lead to higher monthly payments, you will be paying less interest over the life of the loan. If you’re interested in this, connect with me today so we can calculate if it is worthwhile for you to take advantage! Knowing what you can afford and how quickly you want to be mortgage-free can help you determine the best new amortization schedule.

*These options are only available for some mortgage products. Check your mortgage package or reach out to me to ensure these options are available to you and avoid any potential penalties.

If you’re looking to pay your mortgage off quicker, don’t hesitate to call me to go over your options in more detail today!

Smart Ways to Cut Your Energy Costs

In the last decade, climate change and energy efficiency have become top of mind for many Canadians. From wanting to do our part by recycling to making our home as energy efficient as possible, there are so many benefits to being environmentally and energy conscious.

If you are looking to cut costs or simply want to reduce your eco-footprint, here are some great ways to cut your energy costs:

  • Get a Smart Thermostat: A pretty easy installation, a smart thermostat can help you better manage your in-home temperature. Whether you opt to install a basic programmable thermostat or try Google’s Nest, which learns from you and works to predict which temperatures you prefer and when, getting a read on your in-home temperature can help you better manage your energy usage.
  • Look for Drafty Spots: When it comes to heating your home, it can quickly become a wasted effort and results in extra costs if you have drafts in your home. In addition to windows and doors, you should also seal any folding attic stairs, add a fireplace plug to seal the damper and install a dryer vent seal to reduce drafts in your laundry room.
  • Swap to LEDs: Most of us are already using LED bulbs throughout our home. If you aren’t yet, now is the time to make the switch! LED bulbs use 15% less energy than an equivalent incandescent, which can save you a ton of money each month especially in larger homes.
  • Turn Down Your Water Heater: While sometimes nothing beats a good scalding shower, you don’t want to be burned with a high energy bill. Did you know if you knock down that temperature gauge by just 10 degrees, you can save 3% to 5% on your bills each month!?
  • Examine Your Appliances: Since 1992, ENERGY STAR® has been backing energy efficient appliances and products, helping consumers make the right choices. Some of the least green appliances in your home are your dishwasher, washing machine, dryer and refrigerator and, if you don’t currently have Energy Star certified versions of these machines, swapping to them is a surefire way to reduce your monthly expenses.Can’t afford new appliances? Here are some other tips and tricks to help make them more efficient in the meantime:
    • Dishwasher: Use a citric acid-based cleaner in an empty cycle to rid your dishwasher of excess soap and calcium buildup that may be causing your machine to work harder.
    • Washing Machine: Maximize energy by stuffing your machine to the brim whenever possible as washing machines typically use the same amount of energy regardless of load size.
    • Dryer: For starters, ensure you are always cleaning out your lint filter to increase air circulation. In addition, keep an eye on the outside exhaust and clean when needed to reduce drying time and save energy.
    • Refrigerator: While most of us are more concerned with the food inside our fridges than the parts, it is important to check your condenser coils. Over time, dirt, food particles and dust can collect and reduce the efficiency. Another tip is to set your refrigerator to 2-3 degrees Celsius.
  • Close The Blinds: When the temperature starts heating up, it is important to close the blinds and drapes to prevent the sun from beating in and warming up your home. The excessive heat makes your air conditioner work overtime causing your energy bills to skyrocket.

In addition to the cost savings and environmental benefits of improving your energy efficiency, CMHC also has a rebate available! The CMHC Eco Plus refund can provide a 25% partial premium refund if you’re CMHC insured and buying or building an energy-efficient home! Click here for more details.

Economic Insights from Dr. Sherry Cooper

All eyes were on The Bank of Canada last month as they cut interest rates by 25 basis points again during their July 24th meeting, thereby taking the overnight policy rate down to 4.5%.

We believe that owing to a sustained deceleration in inflation, the central bank will continue its monetary easing at the September and December meetings and well into next year.

The policy rate will likely fall to 2.75% next year, reducing the burden of higher monthly mortgage rates on renewals in the next 18 months.

The influx of roughly 2 million immigrants to Canada has raised overall consumer spending, averting a recession this year, but GDP per capita continues to decline.

Labour markets continue to soften as job vacancies have fallen sharply, and the jobless rate has risen from 4.9% to 6.4%. The latest business and consumer surveys have suggested that inflation expectations have fallen and wage inflation—a lagging indicator—will soon decline. Companies expect to cut their spending on machinery and equipment, and commercial real estate valuations have fallen owing to the sharp rise in office vacancy rates.

Housing market activity has slowed with the run-up in interest rates from March 2022 until June 2024. Lower interest rates will spur transactions and increase new listings next year. Housing affordability will improve as price pressures remain muted. The housing shortage, however, will likely mitigate the improvement, particularly as the shortage of experienced construction workers impedes rapid housing supply increases.

 

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

 

Banking Regulator to Relax Stress-Test

General Angela Calla 25 Sep

Banking regulator to relax stress-test rules for homeowners switching lenders at mortgage renewal.

Canada’s banking regulator is set to relax mortgage rules for homeowners who switch banks when they renew their loans.

The Office of the Superintendent of Financial Institutions (OSFI) will no longer require banks to apply the mortgage stress test on borrowers who switch lenders if they are simply renewing their loan, the regulator told The Globe and Mail on Wednesday.

The change, which is due to take effect Nov. 21, will make it easier for borrowers with uninsured mortgages to move to a different bank at renewal. It is also expected to motivate banks to offer cheaper mortgage rates in order to retain their current borrowers and attract new customers.

The change marks a significant win for the mortgage industry, which had been pushing for this relief in the face of rising interest rates.

When borrowers take out their initial mortgage, they must pass the federal mortgage stress test or prove they have enough income to cover their mortgage payments at an interest rate that is two percentage points higher than their actual loan contract.

When the mortgage term ends and they have to renew their loan, borrowers must again pass the mortgage stress test if they want to switch to a different lender because the borrower is new to that lender. That rule stands even if the renewal is a “straight switch,” which means the borrower will remain on the same amortization schedule and is not lengthening the time they will take to pay off their mortgage or increasing the amount of their loan.

But because mortgage rates more than doubled over the past two years to above 6 per cent at their height, borrowers had to prove they could make their loan payments with an interest rate of at least 8 per cent. That made it much more difficult for uninsured borrowers to pass the stress test if they renewed with a different lender.

“There isn’t reckless underwriting in straight switches,” OSFI Superintendent Peter Routledge said in an interview.

Currently, homeowners with insured mortgages are exempt from the mortgage stress test on straight switches because the insurer is protecting the bank if the homeowner misses mortgage payments. (A borrower must pay for mortgage insurance if they have made a down payment that is less than 20 per cent of the property’s purchase price.) But until now, borrowers with uninsured mortgages have still had to requalify if they switched lenders.

The difference in rules between insured and uninsured borrowers is one of the reasons that OSFI decided to make the change. “If I were that Canadian walking in with an uninsured mortgage, I kind of feel like that was an imbalance that wasn’t fair,” Mr. Routledge said. “Part of our job is to enable banks and lenders to take reasonable risks. And part of that reasonable risk-taking may involve treating an uninsured mortgager at renewal for a straight switch the same as an insured,” he said.

OSFI’s decision to eliminate the stress test on straight switches is occurring as the federal government relaxes other mortgage policies. Buyers will soon be allowed to put down smaller down payments on homes worth more than $1-million and first-time homebuyers will be allowed to stretch out their mortgage payments over 30 years instead of 25 on an insured mortgage.

Mr. Routledge said he does not think OSFI’s latest change will have any effect on the mortgage market credit risk or the housing market. He said the regulator has data showing that homeowners overwhelmingly stay with their lender when they renew their mortgages, which was also the case before mortgage stress test went into effect in 2018 for uninsured mortgages.

“I don’t view this as having discernible effect one way or the other,” he said.

The stress test has two thresholds: a minimum qualifying rate, or MQR, that is set by the regulator and an interest rate that is two percentage points higher than the borrower’s mortgage contract. The lender must use the higher interest rate to stress test the borrower. Since the MQR is currently set at 5.25 per cent, it is effectively obsolete because mortgage rates are currently around that level.

(Article courtesy of Rachelle Younglai, Real Estate Reporter)

 

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Attainable Housing Initiative Heather Lands

General Angela Calla 25 Sep

The Attainable Housing Initiative (AHI or Initiative) provides approximately 2,600 strata leasehold homes at an initial 40 percent below market value at the Heather Lands in Vancouver.

The Initiative is intended to provide homes that middle-income, first-time homebuyers can own themselves and live in. It is not intended as an investment vehicle, to generate homes for rent, or to benefit households living outside of B.C.

Read more HERE.

 

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

ENHANCE Your Expertise: IRD Penalties

General Angela Calla 25 Sep

In today’s ever-changing mortgage environment, we understand the challenges, especially when it comes to understanding as a clients the intricacies of Interest Rate Differential (IRD) penalties. We’re here to support you every step of the way. Our products that we offer you before we go to one of the big banks are designed to not only meet your immediate needs but also to protect your long-term financial interests. One way we do this look at monoline lenders with a fair IRD penalty calculation.

Take this example:  one of the big banks has offered you a rate 10 bps lower than what you have been discussing with a mortgage broker. But that lender uses discounted rates. Before you start thinking THIS IS ALL ABOUT THE RATE  learn how the math impacts your future if you are like 7/10 Canadians that will look to break there mortgage for a variety of reasons either with the market or your personal lifestyle on what that lower rate could mean later if they need to break their mortgage in two years:

Let’s compare:

 Client has a slightly lower payment with the other lender and saves about $780 in interest over the two years.
But when they need to break their mortgage, client penalty costs are $23K+ higher.
Client wanted to break the mortgage to take advantage of lower rates. However, due to the high penalty, it doesn’t make sense for the clients to break their term. They are forced to stay with the other lender.
At the end of the term with the other lender, clients will end up with higher interest costs + higher payments for the last 3 years of the term.

How can you avoid costly mistakes and gain Penalty Protection?

  • Understand The Journey – Assess both immediate needs and future financial goals, ensuring you always covered.
  • Understand with Confidence – Life is unpredictable, and most clients will need to break their mortgage. A slightly higher monthly payment can act as insurance against hefty penalties helps protect financial well-being.
  • Leverage Our Expertise – We provide you with extensive product knowledge and transparent penalty information, so you can confidently be guided through any scenario.
  • Review  a Visual – Utilize impactful tools like penalty comparisons that not only make the math clear, but helps you understand the conversation beyond just rates.
  • Keep the Conversation Going – Your Mortgage Broker is here to support you as an expert resource, empowering you with timely and accurate information, ensuring they feel secure in every decision. We advise and you the client always instructs.

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Mortgage Changes | Global News

General Angela Calla 18 Sep

In my recent Global News segment, I discussed exciting updates that could make a big difference for homebuyers and those with upcoming mortgage renewals.
Here are some key takeaways to share with you and your loved ones:

Insured Change Cap: This isn’t just for First Time Buyers—it benefits right-sizers who could be moving up the property ladder.
Those with insured mortgages coming up for renewal, as they are no longer subject to a stress test.
Lower Down payment Requirement: If you’re on a savings plan, this could help you reach your homeownership goals faster. Combine it with the First Time Home Savers Account (available until 2028) for extra support.
RRSP Withdrawal Limit Increase: Take advantage of the higher limit moved up to $60,000.00 from the previous $35,000.00 to plan for your down payment .

Click here to watch the approx 4-minute segment

Here’s a link with the full breakdown and the government announcement.

Lastly, here is an interview Angela did regarding the attainable housing initiative at Heather Lands.

If you or someone you know could benefit from setting up a tax-efficient savings plan, getting pre-approved for a purchase, or reviewing a mortgage renewal, reach out to us for expert guidance! Via email angela@countoncalla.ca or 604-802-3983

 

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

 

 

Great News On the Canadian Inflation Front in August

General Angela Calla 17 Sep

More Good News On The Canadian Inflation Front

The Consumer Price Index (CPI) rose 2.0% year over year in August, the slowest pace since February 2021, and down from a 2.5% gain in July 2024.  core inflation measures averaged 2.35% y/y and excluding mortgage interest, headline inflation was a mere 1.2%– well below the Bank’s target inflation level of 2.0%.  this opens the door for a possible acceleration in Bank of Canada easing.  Governor Macklem has suggested that a 50 bp rate cut is possible if inflation falls too fast as unemployment rises.

The deceleration in headline inflation in August was due, in par, to lower gasoline prices, a combination of lower prices and base-year effect.  The decline in August 2024 was mainly due to lower crude oil prices amid economic concerns in the United States and slowing demand in China.  Excluding gasoline, the CPI rose 2.2% in August, down from 2.5% in July.

Mortgage interest costs and rent remained the most significant contributors to the increase in the CPI in August.  The mortgage interest cost index continued to rise at a slower pace year over year in August (+18.8%) for the 12th consecutive month after peaking in August 2023 (+30.9%).

The CPI fell 0.2% m/m in August after increasing 0.4% in July.  Lower prices for air transportation, gasoline, clothing and footwear, and travel tours led to a monthly decline.  The CPI rose 0.1% in August on a seasonally adjusted monthly basis.

The central bank’s two core inflation measures decreased, averaging a 2.35% yearly pace from 2.55% a month earlier, matching expectations.  According to Bloomberg calculations, a three-month moving average of those measures fell to an annualized pace of 2.4% from 2.8% in July.

August marked the eighth month of headline rates within the central bank’s target range.

Bottom Line

The inflation print is the first of two CPI reports before the Bank of Canada’s next rate decision on Oct. 23.  After the data was released, overnight swaps traders upped their bets on a larger-than-normal reduction at that decision, putting the odds of a 50-basis point cut at just over a coin-flip.  Prices declined in five or eight subsectors every month, which could trigger worries about deflation among central bank officials i it becomes a trend.  Macklem has recently said that bank cares as much about undershooting the 2% inflation target as it is overshooting it.

Markets now suggest a 47% chance of a 50 bps BoC cut on October 23 and a 57% probability of a 25 bps cut.  Next week’s GDP data and the October 15 CPI report loom large in the 25 versus 50 bps debate.

Further rate cuts will no doubt spur a housing recovery, though we suspect a shallow one initially due to affordability issues in Ontario and B.C.  However, three new mortgage rule changes (effective December 15) could speed things along.  the changes will allow all buyers to get a longer 30-yuear mortgage for a new build, first-time buyers to get a similar term for all properties (both new and old), and buyers to get an insured loan on a home priced up to $1.5 Million (versus $1.0 million currently).  The latter change will allow smaller down payments and lower borrowing costs than an uninsured loan.  The 5-year extended term will lower monthly mortgage payments by about 9%.

Article courtesy of Dr. Sherry Cooper, Chief Economist, Dominion Lending Centres

 

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Insured Mortgage Changes- Breaking News

General Angela Calla 16 Sep

Exciting News to Help Homebuyers and Those up For Renewal Annouced This Morning,

Top Points from Today’s Mortgage Changes Announcement:

Higher Price Cap for Insured Mortgages:

Starting December 15, 2024, homebuyers can purchase properties up to $1.5 million with less than a 20% down payment. This adjustment allows more homes to qualify for insured mortgages, increasing accessibility for buyers.

Down Payment Savings Example – $1.2 Million Home:

Old Requirement (above $1 million):

A 20% down payment was required = $240,000.

New Requirement (under the $1.5 million cap):

5% on the first $500,000 = $25,000

10% on the next $700,000 = $70,000

Total Down Payment: $95,000

This change results in a $145,000 down payment savings for buyers purchasing a $1.2 million home.

Expanded 30-Year Amortization:

More buyers, especially first-time homebuyers and those purchasing new builds, can now access 30-year mortgage amortizations, reducing their monthly payments and making homeownership more affordable.

No Stress Test at Renewal for Insured Mortgage Holders:

Insured mortgage holders can now switch lenders at renewal without needing to pass another stress test. This is a major advantage in today’s higher interest rate environment, enabling borrowers to secure better rates without the fear of requalification.

Reduced Stress at Renewal:

As mortgage rates are currently higher than when many first obtained their loans, the removal of the stress test eases the renewal process, giving homeowners more flexibility to find the best deal and improving competition among lenders.

Additional Financial Tools for First-Time Homebuyers:

Combined with the new First-Time Homebuyers Savings Account and the increased RRSP withdrawal limit (raised from $35,000 to $60,000), these changes give Canadians more tools than ever to access homeownership. This represents the most significant policy shift since 2012.

If you or a loved one have questions on a mortgage please reach out to us directly

Full article from today: https://www.canada.ca/en/department-finance/news/2024/09/government-announces-boldest-mortgage-reforms-in-decades-to-unlock-homeownership-for-more-canadians.html

Have a  great week

Angela Calla

Mortgage Expert & Author

______________________________________________
(778) 831-0200 
angela@countoncalla.ca
angelacalla.ca

Canadian Employment Growth Stalled In July, While the Jobless Rate Held Steady at 6.4%

General Angela Calla 12 Aug

Weaker-Than-Expected July Jobs Report Keeps BoC Rate Cuts In-Play

Canadian employment data, released today by Statistics Canada, showed a continued slowdown, which historically would have been a harbinger of recession. This cycle, immigration has augmented the growth of the labour force and consumer spending, forestalling a significant economic downturn.

Employment declined again in July, down 2.8K. The employment rate—the proportion of the population aged 15 and older who are working—fell 0.2 percentage points to 60.9% in July. The employment rate has followed a downward trend since reaching a high of 62.4% in January and February 2023 and has fallen in nine of the last ten months.

In July 2024, an increase in full-time work (+62,000; +0.4%) was offset by a decline in part-time work (-64,000; -1.7%). Despite these changes, part-time employment (+3.4%; +122,000) has grown faster than full-time employment (+1.4%; +224,000) on a year-over-year basis.

Public sector employment rose by 41,000 (+0.9%) in July and was up by 205,000 (+4.8%) compared with 12 months earlier. Public sector employment gains over the last year have been led by increases in health care and social assistance (+87,000; +6.9%), public administration (+57,000; +4.8%) and educational services (+33,000; +3.3%) (not seasonally adjusted).

Self-employment changed little in July and was up by 55,000 (+2.1%) year-over-year.

 

The unemployment rate was unchanged at 6.4% in July, following two consecutive monthly increases in May (+0.1 percentage points) and June (+0.2 percentage points). On a year-over-year basis, the unemployment rate was up by 0.9 percentage points in July.

The jobless rate rose more for recent immigrants, especially youth than those born in Canada.

The unemployment rate for this group was 22.8% in July, up 8.6 percentage points from one year earlier. For recent immigrants in the core working age group, the unemployment rate rose by 2.0 percentage points to 10.4% over the same period.

In comparison, the unemployment rate for people born in Canada was up 0.5 percentage points to 5.6% on a year-over-year basis in July, while the rate for more established immigrants (who had landed in Canada more than five years earlier) was up 1.2 percentage points to 6.3%.

 

In July, employment in wholesale and retail trade decreased by 44,000 (-1.5%), reflecting a continuing downward trend since August 2023. On a year-over-year basis, employment in the industry was down by 127,000 (-4.2%) in July 2024.

Employment in finance, insurance, real estate, rental, and leasing declined by 15,000 (-1.0%) in July, marking the first decline since November 2023. On a year-over-year basis, employment in this industry showed little change in July 2024.

Public administration saw a rise in employment by 20,000 (+1.6%) in July, following a decline in June (-8,800; -0.7%). Employment in transportation and warehousing also increased in July by 15,000 (+1.4%), partially offsetting declines in May (-21,000; -1.9%) and June (-12,000; -1.1%).

British Columbia experienced the highest job losses, while Ontario and Saskatchewan were the only provinces to add employment.

Adjusted to US standards, the unemployment rate in Canada for July was 5.4%, which was 1.1 percentage points higher than in the United States (4.3%). Compared with 12 months earlier, the unemployment rate increased by 0.8 percentage points in both Canada and the United States.

The employment rate has decreased in both countries over the past 12 months, with a larger decline in Canada. From July 2023 to July 2024, the employment rate (adjusted to US concepts) fell by 1.0 percentage points to 61.5% in Canada, while it declined by 0.4 percentage points to 60.0% in the United States.  Compared with 12 months earlier, the unemployment rate increased by 0.8 percentage points in Canada and the United States.

Bottom Line

This is the only jobs report before the Bank of Canada meets again on September 4. Traders expect further rate cuts at the three remaining meetings this year.

Last week, weaker employment data in the US contributed to a selloff in global equities, as bonds rallied amid increased bets that the Federal Reserve will be forced to cut borrowing costs more deeply and quickly than previously expected.

The interconnectedness of the economies of the United States and Canada implies that any further weakening in the former is likely to permeate into the latter. This scenario affords Macklem the latitude to normalize borrowing costs without the concern of outpacing the Federal Reserve to a degree that could jeopardize the Canadian dollar.

 

Article courtesy of Dr. Sherry Cooper, Chief Economist, DLC

 

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

 

Bank of Canada Announcement – July 24 2024

General Angela Calla 24 Jul

We hope you are enjoying summer. We are pleased to share some positive news regarding the recent Bank of Canada rate announcement this morning.  Prime Rate has decreased which will impact  Adjustable Rate Mortgages (ARM’s) and Lines or Credit by approx. $13 dollars per $100k, while working to reduce the amortization of Variable Rate Mortgage ( VRM ) mortgage holders.  We expect banks to follow with their prime rate being reduced to 6.70%.  Read the full press release HERE.

The downward trend in rates is a very welcome development and may present new opportunities for homeowners and potential buyers alike.

If you or a loved one have any questions about how this change might affect your mortgage or financial plans, please do not hesitate to reach out. Our team is here to provide you with personalized advice and support, just kindly email callateam@countoncalla.ca or call us at 604-802-3983

 

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Reverse Mortgage Myth

General Angela Calla 10 Jul

Myth: There will be nothing left for my kids if I take a Reverse Mortgage

“I have kids so I don’t want to leave nothing for them”.  I hear this and it’s not an accurate statement. A reverse mortgage is not only suitable for people without kids or for those not concerned with passing anything down to their kids.

We tend to look at the inheritance issue as binary – if these clients take a reverse mortgage there will be nothing left for their kids, if they don’t take a reverse mortgage the kids will have a good inheritance.

Take the example of clients with a $1.6M clear title home. They have minimal pensions and some investments. They are the definition of ‘house rich, cash poor’.  An extra $2,000/month would make a huge difference to their lifestyle, but they want to be able to pass their home down to their kids so they have chosen to live a subpar retirement for the good of their children.

When we run the numbers on our Reverse Mortgage Income Advantage product with the clients receiving $2,000/month and assuming their home appreciates at 4% per year, their mortgage balance in 10 years will be $446,038. Their home will be worth $2,150,266, meaning their net equity will be $1,704,228. After 10 years their estate has grown, not been depleted.

What about after 20 years? Their mortgage balance will have increased to $1,552,022 and their home is now worth $2,889,778. Their net equity is $1,337,756.

These clients were able to stay in their home for 20 years with a $2,000/month annuity and now, instead of passing $1.6M on to their children, their kids will inherit just over $1.3M.

Would your clients be okay with their kids inheriting $1.3M vs $1.6M if it means they could have an additional $2,000/month for 20 years, remain in the home they love and enjoy their retirement?

Recent Client Story – Maximizing Cashflow in Retirement

Jeff (71) and Janice (71) have a $2.1M home in New Westminster with a $410,000 mortgage. They received their TD renewal notice and could not afford the new payments on their pension income. They would have needed to significantly increase their investment withdrawals to cover the shortfall as they were already feeling stretched with the mortgage payment.

Reverse Mortgage approved loan amount: $826,500

They advanced $490,000, enough to payout their existing mortgage, add air conditioning to their home and have a little extra left over. They hadn’t been enjoying meals out or vacations the last couple years as money was tight. Their cashflow significantly improves now that they don’t have a mortgage payment.

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

« First…23456…102030…Last »