May Newsletter

General Angela Calla 7 May

Welcome to the May issue of my monthly newsletter!

Welcome to May! Hard to believe we’re already a third of the way into 2025. The Stanley Cup Playoffs are in full swing, and hockey fans across Canada are hoping this is the year the Cup finally comes home. Is your team still in the hunt?

While we wait to see how things play out on the ice, this month’s update covers mortgage penalties—what they are and how to avoid them—plus some great ways to boost your home’s value, no matter your budget.

Enjoy – and if you’re watching the playoffs, may your team go all the way!

Understanding Mortgage Penalties

Many homeowners—especially those without a mortgage broker—don’t fully understand mortgage penalties. And I get it! Financing a home can be overwhelming. But if you’re considering refinancing, selling, making a lump sum payment, or need a way out, read this first.

The most common mortgage penalty my clients encounter is a prepayment penalty. Did you know? Your lender doesn’t want their money back early! That’s because they earn guaranteed interest on the loan, helping them not only budget but also profit. Let’s go over the types of prepayment penalties:

Prepayment or Overpayment: If you make a lump sum payment on your mortgage or increase the regular payments by too much, you could be outside the terms of your mortgage agreement.

Transferring: If you move your mortgage to another lender before the end of your term, that is considered breaking the mortgage agreement you made.

Early Re-Payment: If you sell your home and pay off your lender with the proceeds, leaving you without a mortgage, that also breaks the agreement.

Breaking your mortgage for these—or any other reason—almost always results in financial penalties. The amount of the penalty that could be owed will be based on a few factors:

The amount of pre- or over-payment

Interest rates (existing and new)

The type of mortgage (open, closed) and the type of rate (fixed, variable)

How can you reduce or avoid prepayment fees?

The simplest answer is to wait until the end of your existing term to make changes. If that’s not possible, let’s review your circumstances:

Do you have a fixed or variable rate? If you have a variable rate and you’re breaking the mortgage in favour of a fixed option, first check to see if you can lock in a rate under your existing terms

Are you making a lump-sum payment? Review the terms of your mortgage to see what your annual prepayment allowance is. Most mortgages will let you make some fixed lump sum payments without any penalties

Penalties for non-payment

There’s also a flip side to penalties, which involves incurring a penalty because you’re making a late payment or missing payments.

You won’t be surprised that any payment received after the due date will incur a fee. Lenders will also report the missed payment to the credit bureau, which will impact your credit score. Before you miss a payment, the best thing you can do is to notify your lender (especially before it happens) and let them know. You can work together to defer a payment, skip a payment, or make other alternative arrangements.

If you’re with a lender that offers it, consider taking a ‘mortgage payment holiday’ and either skipping or deferring payments for a specific amount of time. Some lenders allow up to 3-6 months or possibly longer, depending on the circumstances.

If you have already missed a payment, you should make up that late or missed payment as soon as possible to avoid a quickly escalating situation.

When can penalties be worthwhile?

It is important to note that sometimes, paying a penalty can be worthwhile—especially if you’re locked into a higher-rate mortgage and the savings from breaking it and securing a lower rate outweigh the penalty costs. I can help you with this determination! I can help you determine if this makes financial sense for you.

An alternative to mortgage penalties

If you’re likely to break your mortgage agreement, consider an open mortgage. This is a great short-term solution for anyone who has an inheritance coming up, is planning a move out of town, or perhaps getting married (or divorced) and planning to combine (or separate) assets. You regularly pay the mortgage as long as you need it, but when you sell the property—no worries. This option does typically come with higher rates, but the benefit is that there are no penalties to pay it off at any time.

Whatever type of mortgage penalty you might be facing, my best recommendation is to talk to me for expert advice. Do this before you make any commitments so we can go over the fine print and you can understand what you’re getting into! I always take the time to do this with my clients, and I would be happy to assist you also.

Top Home Upgrades to Boost Your Property’s Value

“Spring has a way of bringing everything back to life, even a broken heart—or a dated, messy house.” ~ Willie Nelson (roughly interpreted)

Spring is typically a busy season for the housing market in Canada.

Whether you’re looking to sell or help your home bloom where it’s planted, these value-add ideas will be worth putting on your to-do list. We’ve sorted the chores by cost so you can consider your budget first and foremost.

Now, let’s get to work!

Under $100

Perhaps the best bang for your buck is to focus on the front of the house. A few inexpensive ideas are to paint the front railing, upgrade the mailbox, or change the numbers on your house. You’ll also get a lot of value from some yard maintenance, like raking, picking up the pinecones, cutting the grass, or planting a few flowers. Do you know why flowers are so popular? They have a lot of buds. ????

Looking at the inside of the house, something almost all of us could benefit from is decluttering. Go through kitchen drawers and cupboards, closets, and even review the décor in your home. If you still have one of those tall vases with some wheat coming out of it, it’s time to let that go. While you’re scrutinizing every nook and cranny, make sure all the lightbulbs work—and replace any that are burnt out.

Under $500

This budget can get you pretty far if you’re willing to DIY some projects. For example, you could get some paint and supplies and paint a whole new colour into your home. Start with a room or even just an accent wall to make the project more manageable. Another option is to put a firepit in your yard. Seeing and using the space in a new way might make you fall in love with the home all over again.

Another option is to tackle some small upgrades, like new knobs on the kitchen drawers, replacing a toilet seat with an upgraded bidet, or even installing a new light fixture that brightens up a room. Some door handles might need replacing or you may even want to add some curtains or a window treatment to the most used rooms in your home.

Under $1000

Perhaps the biggest suggestion in this category is a professional cleaner. Having someone come in and truly scrub the baseboards, inside the oven, and all those other sneaky little places will make your house look instantly better. Be sure to make a list of what needs the most attention and prioritize the tasks when you hire the cleaner. You could also get your carpets professionally cleaned – they’ll both look and feel much better.

Another idea is to add some tech into your home, like a smart thermostat, lighting, or a camera-based security system. These can be relatively easy to install on your own which is a great way to save some money.

Under $2500

We’re going to start with an interesting one here, which is to upgrade your front door to a steel door. Based on the numbers online, you’ll make back 188% of the value at resale, so think of it as an investment.

If you’ve got hardwood floors, getting them refinished will make a big difference aesthetically in your home. If that’s not a direction you want to go, you could also upgrade the space with a high-quality area rug.

Under $5000

The first suggestion is to upgrade your bedroom closets to custom designs. Make the space more functional for the clothes, shoes, and accessories you have. It will not only make getting dressed easier, but the entire space will be easier on the eyes.

The second suggestion is to install a new garage door. Whether it’s a newly automatic door or simply a better-looking replacement, a new garage door has been shown to recoup 194% of its cost at resale. And if resale isn’t the direction you’re going, you can still use the new door and have your property looking better quickly.

Unrestricted Budget

This next section is something you’re almost certainly better off hiring a professional to tackle. These are much more time and labour intensive, so be sure to research the cost and get quotes from professionals before launching into any of them. Here are a few suggestions:

Replace the roof. Speaking of roofs, do you know why the roof went to the doctor? It had shingles.
Redo the kitchen to modern design with new appliances like a gas stove, convection oven, double dishwasher, tech-heavy fridge, or other things you’ve had on your bucket list
Add an addition to the home with an office space
Replace windows with energy efficient ones and include window dressings
The bottom line here is that no matter how big or how small your budget is, there are plenty of things you can do to spruce up your home and either enjoy it more yourself or increase its value to a potential buyer.

Economic Insights from Dr. Sherry Cooper

President Trump’s second term, now just over 90 days long, has wreaked chaos worldwide. A selloff in US assets deepened as President Donald Trump stepped up criticism of Jerome Powell, Chairman of the Federal Reserve, on social media, with stocks, the dollar and longer-dated Treasuries sliding amid concerns about the Federal Reserve’s future independence.

Trump’s assurances that tariff talks were progressing did little to stop the rout. Wealth has been obliterated as stocks have sold off everywhere, and the US dollar has weakened to a 15-month low. The benchmark 10-year fell, with the yield close to 4.4%. As investors turned away from US securities, haven assets climbed. Gold jumped to another record, above $3,400 an ounce, while the Swiss franc gained more than 1% against the dollar.

The weakness also spread to the US credit market. In derivatives, the cost of protecting a basket of high-grade credit securities against default rose to the highest over a week. Three investment-grade companies looked at selling bonds on Monday.

The US president took to Truth Social, escalating his attack on the Fed chair, insisting there was “virtually” no inflation and it was time for “preemptive cuts.” The last reading of the Fed’s preferred inflation gauge remains above the central bank’s target. There will be a new readout next week.

National Economic Council Director Kevin Hassett said on Friday that Trump is studying whether he can fire Powell. The comments raised new questions about whether the Fed can maintain its longstanding independence, with the president increasingly venting dissatisfaction in harsh terms that the central bank hasn’t moved faster to lower interest rates.

“Were Powell to be fired, the initial reaction would be a huge injection of volatility into financial markets and the most dramatic rush to the exit from US assets possible,” said Michael Brown, senior research strategist at Pepperstone. “Not only is the independence of the Fed clearly under threat, but the prospect of de-dollarisation and a move away from US hegemony is increasingly realistic.”

Hedge fund elites have echoed this concern. According to people present, Paul Singer, founder of Elliott Investment Management, warned recently at a private event in Abu Dhabi that the US dollar might lose its reserve currency status.

Rebuking the Fed risks politicizing US monetary policy in a way that markets find deeply unsettling.

“Frankly, firing Powell stretches belief,” said Christopher Wong, a currency strategist at Oversea-Chinese Banking Corp. “If the credibility of the Fed is called into question, it could severely erode confidence in the dollar.”

Fed Chicago President Austan Goolsbee warned against efforts to curtail the central bank’s independence. “There’s virtual unanimity among economists that monetary independence from political interference — that the Fed or any central bank be able to do the job needs to do — is essential,” Goolsbee said on CBS’s Face the Nation on Sunday.

Legal scholars say that a president can’t dismiss a Fed chair easily, and Powell has previously said he wouldn’t resign if asked by Trump.

Trade War

Trump’s tariff offensive also weighed a heavy burden on markets amid worries about a financial slump.

“The global economy is buffeted by a US war on trade, which we believe generates a large enough economic shock to threaten the life of the US and global expansion,” wrote Bruce Kasman, chief economist at JPMorgan Chase.

The Bloomberg Dollar Spot Index slid 0.7% on Monday—every Group-of-10 currency gained against the greenback, including the Canadian dollar. The yen jump weighed on stock indexes in Japan, pushing the Nikkei 225 down 1.3%.

The yen, euro and Swiss franc rallied. WTI crude fell more than 2% to below $64 a barrel. This and eliminating the consumer carbon tax should keep April inflation close to the target level.

As a sign that investors are rotating investments away from the US, Deutsche Bank AG said that Chinese clients had reduced some of their Treasury holdings in favour of European debt. European high-quality bonds, Japanese government bonds and gold are likely to be the potential choices for investors as alternatives to Treasuries.

With this backdrop, the Canadian economy has slowed precipitously. A Canadian recession likely began in the second quarter as consumer and business confidence plunged to record lows. While the details of the imposed levies are uncertain, there is no question that layoffs in the most vulnerable sectors, such as auto manufacturing, are just the tip of the iceberg. Other highly vulnerable sectors include agriculture, mining and minerals, energy, and lumber.

Once the Canadian election is behind us, the most critical next step would be renegotiating the USMCA—the free trade agreement initially negotiated by the first Trump administration.

Tariff turmoil and rising longer-term interest rates have sideswiped Canada’s housing markets, especially in Toronto and Vancouver, where overbuilding and rising new listings have led to a marked decline in the sales-to-new-listings ratio. Home prices are soft, and sellers are motivated.

While the Bank of Canada moved to the sidelines at the April 16 meeting, we believe incoming data will confirm that a recession is imminent. Although trade restrictions put upward pressure on prices, the central bank will no doubt respond if one-shot price hikes feed into an inflationary cycle.

Because Canada is far more interest rate sensitive and depends critically on trade with the US, our economic reaction is likely to be the canary in the coal mine. The Bank of Canada will undoubtedly respond to recessionary pressure by decreasing the overnight policy rate to 2.0%-to-2.25% in the next few months. This should help to spur housing activity where pent-up demand for housing is growing.

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. 

Buying a Property on Leased Land vs. Fee Simple: What You Need to Know

General Angela Calla 16 Apr

When purchasing real estate, most people assume they’re buying the land and the home together. That’s called fee simple ownership, and it’s the most common form of property ownership in Canada. However, in some areas—especially near waterfronts, on First Nations land, or in resort communities—you might come across homes built on leased land.

So what does that mean for you as a buyer? Let’s break down the pros and considerations of purchasing a property on leased land.

What is Leased Land?

With leased land, you’re buying the home or building but not the land underneath it. Instead, you lease the land from a landlord (which could be a private owner, a government entity, or a First Nations band) for a set period—often 20, 50, or even 99 years.

Pros of Buying on Leased Land

1. Lower Purchase Price

Leased land properties are often more affordable than comparable fee simple homes, allowing access to more desirable locations or larger homes within your budget.

2. Potential Tax Savings (subject to legal advice at time of purchase)

Depending on the nature of the lease and property, you may not be required to pay GST on the purchase, and in some cases, the Property Transfer Tax (PTT) may not apply. These savings can be significant—especially for higher-value properties.

3. Restrictions

Leased land properties may be exempt from disallowing short-term rentals like Airbnb,—great for buyers seeking flexibility in ownership .

4. Opportunity to Own in Prime Locations

Leased land is common in waterfront communities, resort areas, or urban hubs. If you’ve dreamed of lake views or vacation-style living, this could be your in.

5. Less Property Maintenance

In certain leased land developments, the landowner handles common area maintenance or landscaping—similar to strata—reducing your personal upkeep responsibilities.

Considerations to Keep in Mind

1. Financing Can Be Tricky

Not all lenders finance homes on leased land. Terms may be stricter, down payments might be higher (often 25% or more), and some lenders will only finance if the lease has a long enough term remaining—usually at least 20–25 years.

2. Lease Expiration = Uncertainty

When the lease ends, you may have to renegotiate terms, vacate, or remove your home—depending on the lease agreement. Make sure you fully understand the length and renewal terms before purchasing. This will also limited your amortization options for financing.

3. Limited Appreciation Potential

Because the land isn’t yours, homes on leased land may not appreciate at the same rate as fee simple properties. That can impact your long-term investment return.

4. Monthly Lease Fees

In addition to your mortgage and taxes, you’ll pay a monthly lease or land rent. These fees can increase over time and need to be factored into your overall housing costs.

5. Legal Advice is Essential

Every lease is different. It’s absolutely essential to consult a real estate lawyer before purchasing to review the lease terms, confirm tax implications, and understand how the lease affects your o6. Possible Estate Planning Implications

Leased land can impact estate planning, including inheritance, transferability, and future value. For some families, this may offer a streamlined way to manage assets—though legal advice is crucial here to ensure proper planning. ownership and rights.

Who Might Leased Land Be Right For?

Buyers looking for affordability in high-demand areas
Snowbirds or part-time residents
Retirees who want a low-maintenance lifestyle
Investors with a short- to medium-term horizon and a clear exit plan

Final Thoughts

Purchasing a home on leased land can be a smart move—but it comes with unique considerations. It’s not “better” or “worse” than fee simple ownership; it’s just different. What matters is how it aligns with your financial goals, lifestyle, and long-term plans.

If you’re curious whether a leased land property is right for you—or you’ve found a listing and want to understand your financing options and legal considerations—we’re here to help.

Contact us at callateam@countoncalla.ca or 604-802-3983, and we’ll walk you through your options and connect you with trusted professionals to make sure you feel confident in your purchase.

 

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. 

February 2025 Newsletter

General Angela Calla 1 Apr

Welcome to the February issue of my monthly newsletter!

This month, I have all the details for you around second mortgages and understanding if they are right for you! Plus, scroll down for some spring-cleaning tips as we start to shake off the winter dust!

Understanding Second Mortgages: Are They Right for You?

One of the biggest benefits to purchasing your own home is the ability to build equity in your property. This equity can come in handy down the line for refinancing, renovations, or taking out additional loans – such as a second mortgage.

A second mortgage refers to an additional or secondary loan taken out on a property for which you already have a mortgage. Some advantages include the ability to access a large loan sum, better interest rates than a credit card and the ability to use the funds how you see fit. However, keep in mind interest rates are typically higher on a second mortgage versus refinancing and can add additional cash flow tension to your monthly bills. Talk to a mortgage professional today to determine if this is the best option for you!

What is a second mortgage?

First things first, a second mortgage refers to an additional or secondary loan taken out on a property for which you already have a mortgage. This is not the same as purchasing a second home or property and taking out a separate mortgage for that. A second mortgage is a very different product from a traditional mortgage as you are using your existing home equity to qualify for the loan and put up in case of default. Similar to a traditional mortgage, a second mortgage will also come with its own interest rate, monthly payments, set terms, closing costs and more.

Second mortgages versus refinancing

As both refinancing your existing mortgage and taking out a second mortgage can take advantage of existing home equity, it is a good idea to look at the differences between them.

Firstly, a refinance is typically only done when you’re at the end of your current mortgage term so as to avoid any penalties with refinancing the mortgage. The purpose of refinancing is often to take advantage of a lower interest rate, change your mortgage terms or, in some cases, borrow against your home equity.

When you get a second mortgage, you are able to borrow a lump sum against the equity in your current home and can use that money for whatever purpose you see fit. You can even choose to borrow in installments through a credit line and refinance your second mortgage in the future.

Some key things to note when looking at a second mortgage or refinancing:

  • If you have a favorable interest rate on your first mortgage, a second mortgage allows you to keep the lower rate on your primary loan, resulting in a lower blended rate.
  • Refinancing resets the amortization schedule, which could extend the loan term. A second mortgage leaves the existing term intact, helping you stay on track with your overall financial goals.
  • Second mortgages often come with more flexible terms, such as interest-only payments, fully open, or shorter term, which can suit your immediate needs.

What are the advantages of a second mortgage?

There are several advantages when it comes to taking out a second mortgage, including:

  • Homeowners can access a significant portion of their home equity (typically 80%-85% LTV).
  • Better interest rate than a credit card as they are a ‘secured’ form of debt.
  • You can use the money however you see fit without any caveats.
  • Allows you to access your home equity without breaking your existing mortgage and incurring penalty fees.

What are the disadvantages of a second mortgage?

As always, when it comes to taking out an additional loan, there are a few things to consider:

  • Interest rates tend to be higher on a second mortgage than refinancing your mortgage.
  • Additional financial pressure from carrying a second loan and another set of monthly bills.

Before looking into any additional loans, such as a secondary mortgage (or even refinancing), be sure to reach out to me! Regardless of why you are considering a second mortgage, it is a good idea to get a review of your current financial situation and determine if this is the best solution before proceeding.

10 Smart Spring-Cleaning Tips to Revitalize Your Home

As the days grow longer and the sun shines brighter, it’s the perfect time to refresh your home with a thorough Spring clean! A clean, organized space can help you feel more energized and ready to embrace the season ahead.

 

Here are some tips to make your Spring cleaning both efficient and enjoyable

  1. Create a Playlist: Make cleaning fun by curating a playlist of your favorite upbeat songs. Music not only makes the time fly but can also turn your cleaning routine into an enjoyable activity. Dance while you dust and sing while you sweep—your home will thank you!
  2. Clean One Room at a Time: A clean home doesn’t happen overnight, so avoid feeling overwhelmed by tackling one room at a time. Start small, such as with bathrooms or closets, and work your way up to larger spaces like the kitchen or living room. Alternatively, dedicate one or two rooms per weekend, and by the time May rolls around, your home will sparkle!
  3. Declutter as You Go: Spring cleaning isn’t just about scrubbing and polishing—it’s also the ideal time to declutter. Sort through closets, cupboards, and drawers, and separate items into “keep,” “donate,” and “discard” piles. Haven’t used that appliance or worn that sweater in over a year? It’s time to let it go. Clearing out the clutter not only makes cleaning easier but also creates a more organized and calming space.
  4. Go Green: Keep your cleaning eco-friendly by opting for natural solutions. Vinegar and baking soda are versatile and effective for a variety of tasks, from cleaning countertops to unclogging drains. A steam cleaner can also be a fantastic tool for deep-cleaning floors, appliances, and even outdoor spaces without the need for harsh chemicals. Choose sustainable products to keep your home fresh and the environment happy.
  5. Work From Top to Bottom: When cleaning, always start high and work your way down. Dust light fixtures, ceiling fans, and shelves first to avoid re-cleaning surfaces below. This method ensures maximum efficiency and minimizes extra work!
  6. Don’t Forget Hidden Spaces: Pay attention to often-overlooked areas like baseboards, window tracks, and behind large furniture. Use a vacuum attachment to get into tight corners, and wipe down walls and doorframes for a truly comprehensive clean.
  7. Freshen Up the Fridge & Freezer: Spring is the perfect time to clean out your fridge and freezer. Empty the contents, toss expired items, and clean the interior surfaces with a mixture of water and mild soap or vinegar. If defrosting is needed, plan ahead to minimize food waste. Restocking a fresh, clean fridge feels fantastic and can even inspire healthier eating habits!
  8. Revitalize Air Quality: Spring allergens can wreak havoc on your sinuses, but replacing your HVAC and furnace filters can help. Upgrade to a higher-quality filter for added protection against allergens, chemicals, and odors. Consider adding an air purifier for an extra boost to your home’s air quality.
  9. Wash Fabrics & Upholstery: Take time to wash or vacuum curtains, upholstery, and throw pillows, as they can harbor dust and allergens. Rotate or clean your mattress, and swap out heavy winter bedding for lighter, seasonal options. Fresh linens make a big difference in creating a rejuvenated space.
  10. Tidy Outdoor Areas: Spring cleaning isn’t limited to the indoors! Sweep porches, patios, and decks, and clean outdoor furniture. If you have a garden, take this opportunity to prepare for planting by clearing debris and cleaning tools. A fresh outdoor space is the perfect complement to your revitalized home.

Embrace these tips, and your Spring clean will leave your home feeling fresh, organized, and ready for the new season!

Economic Insights from Dr. Sherry Cooper

Wall Street reacted positively to Trump’s initial tariff backpedalling, pushing US equity futures higher. This is a sign that he may pursue a less protectionist approach; for now, it is a boon for multinational companies that rely on cross-border commerce, giving them time to adjust pricing and mitigate any impact on profit margins.

The US dollar, however, slumped, albeit briefly. Canada’s dollar has traded markedly below the US dollar for years. And, although we promised to tighten our border restrictions, the US’s illegal immigration problems have little to do with Canada.

 

The Bank of Canada’s fourth-quarter consumer expectations survey reveals that despite recession concerns, 22.4% of respondents see a greater than 50% chance of moving to a new primary residence within the next year—up from 21.1% in the previous quarter.

 

Similarly, 13.5% of respondents plan to sell their home within the next year, up from 11.4% in Q3. The results also show increased interest from renters, with 19.9% considering a home purchase in the next 12 months, compared to 16.9% last quarter.

 

The Bank of Canada attributes the rise in homebuying intentions to expectations of further interest rate cuts in 2025.

 

“Survey results show that these home buying intentions are supported by consumers seeing and expecting easier credit conditions,” the report notes.

 

However, it also cautions that the timing of home purchases remains uncertain for many: “…those planning to buy a home over the next 12 months said they anticipate around a 50% probability of actually carrying through with those plans.”

 

The Q4 survey revealed that inflation expectations have primarily returned to historical norms. Consumers’ inflation expectations for food and gas stayed steady in the fourth quarter, while expectations for rent eased. However, they still anticipate rent will rise faster than pre-pandemic levels.

 

As a result of the improving inflation outlook, consumers expressed strong intentions to increase spending on essentials and housing over the next year. For the first time since 2021, they anticipate spending will outpace price increases.

 

While the new administration in Washington poses considerable uncertainty for the Canadian economy, the odds are that the Bank of Canada will successfully master a noninflationary rebound in economic activity in 2026.

 

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. 

April 2025 Newsletter

General Angela Calla 1 Apr

Welcome to the April issue of my monthly newsletter!

Spring has sprung for most Canadians (sorry about your luck Alberta) and along with the ever-present trusted mortgage content, this month I have some gardening inspo for anyone that wants to flex their green thumb this year. Enjoy!

Variable-Rate Mortgages: What You Should Know

Shakespeare might have thought ‘to be or not to be’ was the ultimate question, but he wasn’t living in 2025 trying to minimize bank fees and interest charges while maximizing financial returns—and having to pay $9 for a clamshell of raspberries. This month, we’re tackling a modern dilemma: ‘Should I get a variable or fixed rate on my mortgage?’ Not as poetic, but way more practical. Let’s dive in.

Understanding the Basics: Every mortgage payment has two components: principal and interest. Your choice between a fixed or variable mortgage impacts how these are structured over time.

Variable Rate Mortgages: Variable rate mortgages come in two main forms:

  • Fixed Payment Variable Mortgage – You have a set monthly payment, but the portion that goes toward principal vs. interest fluctuates. When rates go up, more of your payment goes toward interest, slowing down how quickly you pay off your mortgage. When rates go down, more goes toward the principal, helping you pay off your loan faster.
  • Adjustable Payment Variable Mortgage – The total mortgage payment fluctuates based on interest rate changes, ensuring the mortgage is paid off within the original amortization schedule. The portion of your payment allocated to interest and principal will shift as rates change.

Variable mortgages introduce an element of unpredictability, which some borrowers are comfortable with, while others prefer the security of knowing exactly what their payments will be.

Fixed Rate Mortgages: A fixed-rate mortgage means your interest rate and monthly payments remain the same throughout your term. This stability can be crucial for those who prioritize predictability in budgeting, mental well-being, or long-term financial planning. If the idea of fluctuating payments makes you uneasy, or if you want to avoid worrying about interest rate changes, a fixed-rate mortgage could be the right choice.

The Interest Rate Factor: The Bank of Canada (BoC) sets the overnight lending rate, which influences the Prime rate set by banks. Variable mortgage rates are typically based on Prime ± a lender-specific adjustment. There are eight key BoC announcements each year that can result in rate changes (or no changes at all). You’ve probably seen me cover these on social media (if not, I’d love for you to follow along!).

During the pandemic, the BoC lowered rates to 0.25% to stimulate borrowing. Rates began increasing in 2022 due to inflation, reaching 5% by mid-2023 before the BoC started cutting them in 2024. As of March 12, 2025, we’re at 2.75%, with six more rate decisions coming this year.

Risks: There are risks with both variable and fixed rates for your mortgage. With a fixed rate, the risk is that if rates drop, you will have a higher payment than what is available on the market. You’d also likely incur a penalty to break the fixed rate term to capitalize on any decreases. With a variable rate, the risk is that changing rates could increase the amortization of your mortgage. We also discussed the risk of Bank of Canada announcements indirectly changing your rate and therefore payment, impacting your budget and cash flow. And one final potential risk is if rates go up enough, it may trigger the need for a lump sum payment to your lender.

2025: What’s Next? The current rate is still above the target 2%, meaning there is room for potential decreases. However, nothing is guaranteed. Rates could hold steady or, in rare cases, even increase due to external factors like inflation spikes or international economic shifts.

Impact on Your Mortgage: If you have a variable mortgage, your rate is based on your lender’s Prime rate, which is influenced by the BoC policy rate. Your mortgage rate is typically Prime ± a lender adjustment. If the Prime rate is 6% and your lender offers Prime – 0.50%, your mortgage rate would be 5.50%.

  • With a fixed payment variable mortgage, more of your payment goes toward principal.
  • With an adjustable payment variable mortgage, your monthly payment decreases.

If you have a fixed-rate mortgage, your rate and payments remain unchanged during your term. This stability is why many borrowers prefer fixed rates, even if they sometimes come with slightly higher initial rates. Fixed rates are influenced by bond market trends rather than the Bank of Canada’s policy rate directly.

Which One is Right for You? There is no universal right answer—only the best choice for your financial situation, risk tolerance, and future plans. As your mortgage professional, I’d love to walk through your mortgage with you and discuss:

  • The pros and cons of fixed vs. variable for your specific needs.
  • How to budget for worst-case scenarios.
  • Whether breaking your current mortgage to switch makes sense.
  • Economic implications of switching between a variable and fixed rate.
  • If adjustments at renewal would benefit you?

Send me an email, text, or call anytime! I’m here to provide guidance, not pressure. Let’s find the best mortgage strategy for you!

Gardening 101: Your Spring Gardening Checklist

If you want to maximize returns on your gardening efforts, we’ve got 3 strategies to take you from garden simp to master plant manipulator.

Strategy 1: Better late than early

Seeds do best when they have an uninterrupted growth phase.

So rather than having your plants stall out in a frost, wait 2 weeks (you can do it!) after your initial instinct to plant. It may seem like it’s too late, but the plants will put it into overdrive and make it work. If you’re in doubt and want to test this theory out, plant half the seeds early, and half the seeds 2 weeks later, and see which does better by the end of the growing season. If you’re new to gardening, you might not have a clue if your tomatoes should go in March 1 or July 1, and that’s totally okay too. The Farmer’s Almanac comes to your rescue with their 2025 updated guideline of when to plant based on your postal code. Click here for details.

Strategy 2: Layout matters

Think measure once, cut twice – but for your garden. First up, arrange the tallest plants on the north side of your garden, and the shortest plants on the south side. This will make sure both your little gem lettuces and the jolly green giant snap peas both get enough sunlight. Second, do your research on how much space each plant needs to thrive so you can plan enough real estate for everyone. This website will help you with both these action items for 71 different vegetables. And don’t be afraid to actually measure out your garden. Putting string dividers in there will help you achieve the perfect layout.

Strategy 3: Weed prevention

Prevention is the best way to avoid destroying your back weeding all spring and summer. This is a bit boujee, but if you don’t have raised garden beds it might just be for you. Putting down a layer of cardboard, then adding a 5-10cms of mulch on top, makes sure the weeds stay underneath while the worms and other goodies stay on top, working hard for your soil and plants. If cardboarding your garden isn’t in the cards, just make sure that there is no open soil. If you can see it, so can a weed! Covering the dirt with a layer of mulch (doesn’t have to be fancy mulch, it can just be lawn clippings, sawdust, and the fall leaves you never bothered to rake up and put out on the curb) will prevent most weeds from having the opportunity to grow in the first place.

Hopefully these tips make you the CEO of your own garden in 2025. If you try something new based on what you read here, send me a pic or a note. I’d love to know what’s working for you and share your advice on my socials!

Economic Insights from Dr. Sherry Cooper

Since Donald Trump took office, all bets are off on the Canadian economic outlook. Most people expected more substantial growth and lower inflation as we moved into 2025. Trump’s tariffs, deregulation, attempts at massive reductions in the federal government bureaucracy and geopolitical machinations have changed everything.

VUCA is the name of the game. An acronym used initially by the US Armed Forces, VUCA stands for volatility, uncertainty, complexity, and ambiguity, and it describes the current situation to a tee. Canadian consumer confidence has fallen to its lowest level in decades. Stock markets have plummeted, the currencies are volatile, interest rates have fallen, and no one knows precisely how this will unfold.

On April 2, the US said it would impose reciprocal tariffs on countries with levies on US goods or that favour domestic producers in some way. Moreover, the president has chosen to go after Canada particularly damagingly. We are the number one supplier of steel and aluminum to the US and are now confronted with 25% tariffs. Inevitably, the economy will slow, layoffs will rise, and tariffs will be passed on to the consumer. Whether this will be a one-shot price hike or spillover into second-order effects is uncertain.

Fed Chairman Powell suggested today that inflation from tariffs will likely be transitory—suggesting that price hikes will trigger higher wage demands. Stagflation is an undesirable possibility.

Central banks do not have the tools to deal with tariff-induced stagflation. Higher interest rates might reduce inflation, but slow economic activity, and lower rates might increase price pressures. China is expected to impose retaliatory tariffs on Canadian canola oil, pork and seafood. The tariffs are push-back against Canada for imposing a 100% levy on electric cars from China and 25% on steel and aluminum.

The US is inserting disruption and disorder into a thriving trading partnership between Canada, Mexico and the US. As Jay Powell says, “It’s hard to say how this is going to work out.”

We are expecting slower growth to be dominant, brought on by VUCA. Shorter-term interest rates will fall. That, combined with more housing supply and lower home prices, should spur housing activity and bring buyers off the sidelines as we move into the Spring selling season.

 

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. 

 

Canadian Inflation Jumped to 2.6% y/y in February As GST Tax Holiday Ended

General Angela Calla 21 Mar

Canadian Inflation Surged to 2.6% in February, Much Stronger Than Expected

The Consumer Price Index (CPI) rose 2.6% year-over-year (y/y) in February, following an increase of 1.9% in January. With the federal tax break ending on February 15, the GST and HST were reapplied to eligible products. This put upward pressure on consumer prices for those items, as taxes paid by consumers are included in the CPI.

While the second straight acceleration in the headline number was expected, the pace of price gains may still surprise Bank of Canada policymakers, who cut interest rates for the seventh straight meeting. Donald Trump’s tariff threats hamper business and consumer spending. But assuming the federal sales tax break hadn’t been in place, Canadian inflation would have jumped even higher to 3% in February. This is at the upper bound of the bank’s target range, from 2.7% a month earlier. Canadian inflation has not been at or above 3% since the end of 2023.

Faster price growth was broad-based in February, the end of the goods and services tax (GST)/harmonized sales tax (HST) break through the month contributed notable upward pressure to prices for eligible products. Slower growth for gasoline prices (+5.1%) moderated the all-items CPI acceleration.

The CPI rose 1.1% m/m in February and 0.7% on a seasonally adjusted basis.  However, the increase exceeded the tax impact as seasonally-adjusted CPI excluding the tax impact was +0.4%. And, in case you want to pin it on food & energy, CPI excluding food, energy & taxes was +0.3%.

Gains were across the board, with the sectors impacted by the tax change seeing the most significant increase: recreation +3.4%, food +1.9%, clothing +1.6%, and alcohol +1.5% more to come next month, with the tax holiday only ending in mid-February. The headline inflation figures are subject to as much noise as we’ve seen in decades. They are poised to continue for at least another couple of months, making it very challenging to interpret the inflation data.

As a result, prices for food purchased from restaurants declined at a slower pace year over year in February (-1.4%) compared with January (-5.1%). Restaurant food prices contributed the most to the acceleration in the all-items CPI in February.

Similarly, on a yearly basis, alcoholic beverages purchased from stores declined 1.4% in February, following a 3.6% decline in January.

On a year-over-year basis, gasoline prices decelerated, with a 5.1% increase in February following an 8.6% gain in January. Prices rose less month over month in February 2025 compared with February 2024, when higher global crude oil prices pushed up gasoline prices, leading to slower year-over-year price growth in February 2025.

Month over month, gasoline prices rose 0.6% in February. This increase was primarily related to higher refining costs amid planned refinery maintenance across North America. This offset lower crude oil prices, mainly due to increased American supply and tariff threats, contributing to slowing global growth concerns.

One notable exception to the broad-based strength was shelter, rising “just” 0.2%. That’s the smallest gain in five months, trimming the yearly pace to 4.2%, the slowest since 2021, with more downside to come. Mortgage interest costs rose a modest 0.2% for a second straight month, slicing it to +9% y/y, ending a 2½-year run of double-digit increases.

Not surprisingly, the core inflation metrics were firm as well. CPI-Trim and Median both rose 0.3% m/m and 2.9% y/y. The 3- and 6-month annualized rates are all above 3% as well, pointing to ongoing stickiness. The breadth of inflation, which has been a focus for the Bank of Canada, also worsened with the share of items rising 3%+ increasing modestly. None of this is encouraging news for policymakers.

Bottom Line

This report will reinforce the Bank of Canada’s cautious stance on easing to mitigate the impact of tariffs. Notably, the upcoming end of the carbon tax will cause inflation to drop sharply in April. However, March may see an increase in inflation as the effects of the tax holiday begin to reverse. There is still a lot of uncertainty surrounding inflation, which complicates the job of policymakers. We will see what April 2 brings regarding additional tariffs.

If the economic outlook did not worsen, the Bank of Canada might consider pausing after cutting rates at seven consecutive meetings. However, the Canadian economy will likely slow significantly in the coming months.

Bank of Canada Governor Tiff Macklem said last week the bank would “”roceed carefully””amid the tariff war. Economists are still awaiting more clarity on tariffs before firming up their expectations for the next rate decision on April 16, when policymakers will also update their forecasts. Right now, traders are betting that the BoC will hold rates steady in April, but a lot can and will happen before then.

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. 

March 2025 Newsletter

General Angela Calla 18 Mar

As the Spring season approaches, I have some updates for how to prepare your finances for the coming homebuying season. Plus, check out my fraud awareness tips as March is Fraud Awareness Month!

Spring Forward: Preparing Your Finances for the Home-Buying Season

Spring is one of the busiest seasons in the real estate market, with buyers eager to find their dream home before summer.

If you’re planning to purchase a home in Spring 2025, now is the time to get your finances in order.

Being financially prepared can help you secure a mortgage with favorable terms and make your home-buying journey smoother. Here’s how to get ready:

1. Check and Strengthen Your Credit Score

Your credit score is one of the most important factors in mortgage approval, influencing both your eligibility and the interest rate you’ll receive. A higher score can save you thousands over the life of your mortgage, so it’s worth taking the time to improve it.

  • Start by checking your credit report for errors, and if you spot any inaccuracies, dispute them immediately.
  • Pay down outstanding debts to lower your credit utilization ratio, which plays a big role in your score.
  • Avoid opening new lines of credit in the months leading up to your mortgage application, as this can temporarily lower your score.
  • By reaching out to me, I can help preserve your credit score as they will pull your credit report once to shop your application. Note: Multiple credit checks in a short period can lower your credit score.

2. Build a Strong Down Payment

The more you can put down up front, the better. A larger down payment can reduce your monthly mortgage costs, give you access to better loan terms, and, in some cases, eliminate the need for mortgage insurance.

  • Set a savings goal based on home prices in your target area so you have a clear plan.
  • Explore first-time homebuyer programs that offer down payment assistance—there are plenty of government and lender-based options.
  • Make saving a habit by automating deposits into a dedicated home savings account.
  • Avoid moving your money around to multiple accounts prior to applying for your mortgage. Lenders require a 90-day history of your down payment and a history of moving your money around can make this more difficult to easily verify your down payment.

3. Reduce Your Debt-to-Income Ratio (DTI)

Lenders use your debt-to-income ratio (DTI), aka GDS/TDS, to assess how comfortably you can handle a mortgage payment on top of your existing obligations. A lower DTI signals financial stability, improves your chances of loan approval and can expand your borrowing power.

  • Work on paying off high-interest debts or debts with high monthly payments, like credit cards and personal loans, to free up more of your income.
  • Hold off on making large purchases or taking on new loans, such as car financing, before applying for a mortgage.
  • If possible, look for ways to increase your income—whether through a raise, side gig, or freelance work—to strengthen your financial standing. Note self employed income or part time non guaranteed hours employment generally require a 2-year history.

4. Get Pre-Approved for a Mortgage

A mortgage pre-approval is a game-changer in a competitive market. It gives you a clear budget, shows sellers that you’re a serious buyer, and can even speed up the closing process.

  • Start gathering essential documents like tax returns, pay stubs, and bank statements—lenders and myself will need these to assess your financial health.
  • Reach out to me today for information to help you compare mortgage rates and terms, ensuring you get the best deal.
  • Take time to discuss your mortgage options with me, from fixed to variable rates, different term lengths, or special programs available to you.
  • Download my mobile mortgage app.

5. Budget for Additional Costs

The home price isn’t the only expense you’ll need to plan for. Homeownership comes with extra costs that can catch buyers off guard if they’re not prepared.

  • Closing costs typically range from 1.5% to 4% of the home’s purchase price, covering legal fees, land transfer taxes, and more. This is money you need on top of your down payment
  • Property taxes, Condo fees and homeowners’ insurance can add to your monthly expenses—make sure to factor them into your budget.
  • Set aside a fund for home maintenance and emergency repairs to avoid financial strain when unexpected expenses arise.

6. Research the Housing Market

Spring is a competitive time to buy, so being well-informed about the market can give you an edge.

  • Keep an eye on housing prices in your preferred neighborhoods to understand trends and pricing expectations.
  • Stay updated on current interest rates, as they directly impact affordability and your monthly payments.
  • Work with a trusted real estate agent who can help you navigate bidding wars, negotiate offers, and find the right home for your needs.

7. Consider Locking in an Interest Rate

Interest rates can fluctuate, and even a small increase can affect your monthly payments. If rates are expected to rise, securing a lower rate in advance could save you money over time.

  • Ask me about rate lock options and how long they’re valid for. Rate holds on average are valid for 120 days before they expire and a new rate hold period is requested
  • Compare fixed and variable rates to see which aligns best with your financial goals.
  • Keep an eye on Bank of Canada rate announcements and economic trends that could impact mortgage rates. Note: With recent Bank of Canada announcements variable rates which are tied to Prime are dropping.

Taking these steps now will set you up for success. The more financially prepared you are, the smoother the process will be—and the better your chances of landing your dream home at the right price.

Fraud Awareness Month: Scams to Avoid

Did you know? March is Fraud Awareness Month, making it the perfect time to learn how to protect yourself and your mortgage from fraud.

Understanding common mortgage scams and how to recognize warning signs can make all the difference in safeguarding your financial well-being.

Common Mortgage Fraud Scams

One of the most frequent types of mortgage fraud involves a fraudster acquiring a property and artificially inflating its value through a series of sales and resales. They then secure a mortgage based on the inflated price, leaving lenders and buyers at risk.

Red Flags to Watch For

Be cautious if you encounter any of the following:

  • Someone offers you money to use your name and credit to obtain a mortgage
  • You’re encouraged to provide false information on a mortgage application
  • You’re asked to leave signature lines or other sections of your mortgage application blank
  • A seller or investment advisor discourages you from inspecting the property before purchase
  • The seller or developer offers a rebate on closing that isn’t disclosed to your lender

Title Fraud: A Costly Scam

Another major concern is title fraud, which is a form of identity theft. This occurs when a fraudster, using false identification, forges documents to transfer your property into their name. They then take out a new mortgage on your home, collect the funds, and disappear—leaving you to deal with the consequences when your lender starts foreclosure proceedings.

How to Protect Yourself from Title Fraud

  • Always visit the property you’re purchasing in person.
  • Compare local listings to ensure the asking price is reasonable.
  • Work with a licensed real estate agent.
  • Be cautious of realtors or mortgage professionals with a financial stake in the deal.
  • Request a copy of the land title or conduct a historical title search.
  • Include a professional appraisal in the offer to purchase.
  • Require a home inspection to check for hidden issues.
  • Ask for receipts for recent renovations to verify legitimacy.
  • Ensure your deposit is held in trust for added security.
  • Consider title insurance—the best time to get it is before fraud occurs, not after.

Stay Vigilant and Take Action

Fraud can have devastating financial consequences, but staying proactive and informed is your best defense. If you suspect fraudulent activity, act quickly—report it to the authorities and take steps to protect your assets.

Knowledge is power, and by staying alert, you can keep your mortgage and finances secure.

Monitoring your credit report can also help stay ahead of any fraud activity pertaining to identity theft!

Economic Insights from Dr. Sherry Cooper

The outlook for the Canadian economy in the coming months presents a picture of cautious optimism with high uncertainty.  Economic indicators were expected to strengthen this year, driven by resilient consumer spending and a robust export sector.  Housing activity was poised to accelerate this year as well.

However, when the newly inaugurated US president began to threaten Canada with 25% tariffs at the end of January, home sales slowed markedly. However, challenges such as global market volatility and inflationary pressures could temper this growth.

The Bank of Canada will maintain its current monetary policy stance, carefully balancing interest rates to manage inflation while supporting economic activity. The housing market remains a key area of focus, with efforts to address affordability and supply constraints continuing to be critical. Immigration is slated to slow this year, particularly for non-permanent residents, which will ease the housing shortage. Rents have fallen sharply in recent months.

Rising costs, labour shortages, and potential import tariffs on building materials could hinder construction activity.

Tariff threats are real and unnerving. Exports account for roughly a third of Canadian economic activity. Canada sends 75% of its exports to the US,   led by energy, automobiles, and metals. Threatened attacks on these trade flows might initially spill into higher prices. Still, the primary impact would be to slow economic activity and increase unemployment, already at 6.6%, up from a cycle low of 4.8% in July 2022. In contrast, the US jobless rate is a mere 4.0% and GDP growth is a lot stronger than in Canada despite double the central bank rate cuts than south of the border.

In the event of a trade war, interest rates are more likely to fall as the BoC attempts to backstop the economy. This would decrease mortgage rates, with floating rates falling more than fixed-rate loans. About 1.2 million mortgages will renew this year, most of them at a higher rate, said real estate company Royal LePage in a report out this morning.

Almost 30% of those homeowners said they would choose a variable rate on renewal, up from 24% now on a floating rate. Sixty-six percent said they would renew on a fixed-rate loan, down from 75% now locked in.

Of those who expect their monthly mortgage payment to rise upon renewal this year, 81% said the increase would put a financial strain on their household.

There remains a good chance that Canada could avert a trade war. We’ve already taken action to tighten our border. The US could not easily replace the oil, hydroelectricity power, autos or aluminum it purchases from Canada. We are the largest export market for US products. Excluding oil exports, the US has a trade surplus with Canada. Revisions to the US, Canada, and Mexico trade deal, slated for next year, could be accelerated. The US has much bigger fish to fry than trade concerns with Canada.

On balance, interest rates are likely to fall further. Government actions to improve housing affordability and pent-up housing demand bode well for a housing revival this year. Canadian inflation is under control at about 2%, boosting the chances of additional rate cuts this year.

 

 

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 Cuts Policy Rate By 25 BPs

General Angela Calla 18 Mar

The Bank of Canada (BoC) reduced the overnight rate by 25 basis points this morning, bringing the policy rate down to 2.75%, within the neutral range of 2.25%—2.75%. Tariff tremors have already led to a decline in consumer confidence and spending, a weakening labour market, and a decline in business investment. Compound that with falling population growth, and you see why the Governing Council took the overnight rate down again even though they state that monetary policy cannot offset the impacts of a trade war.

Trade wars lead to higher prices and slower growth. The rise in prices causes consumers to tighten their belts, concerned about the impact of tariffs on their income and investments. Today, there is a 25% tariff on steel and aluminum exports to the US. This impacts Canada the most as it supplies roughly 80% of US aluminum demand. The EU introduced retaliatory tariffs on US goods in response. Canada added to its retaliation. Recent data suggest the US economy is slowing.

Monetary policy remains restrictive as the real overnight rate (2.75% minus the headline inflation rate) is 85 bps, up from the historical average of 60 bps. Five-year Government of Canada bond yields increased on the news to 2.65% compared to 4.05% in the US. The Federal Reserve is not expected to cut rates when it meets again this month.

Despite relatively strong GDP growth in Canada in the second half of last year, home sales and hiring began to slow in late January due to tariff threats, and more tariffs are yet to come. On March 20, China is expected to impose 100% retaliatory tariffs on Canadian canola oil, while pork and seafood will face a 25% levy. The Chinese tariffs are a push-back against Canada for imposing a 100% levy on electric cars from China and  25% on steel and aluminum.

On April 2, the US announced it will impose reciprocal tariffs on nations that have levied tariffs on US goods. President Trump has also said he is considering imposing retaliatory tariffs on Canadian dairy and lumber.

“We’re now facing a new crisis. The economic impact could be severe depending on the extent and duration of new US tariffs,” Macklem said in his prepared remarks.

Macklem called the uncertainty of the tariff dispute “pervasive” and said that it was “already causing harm.” Officials said the “continuously changing” US tariff threat was hitting consumers’ spending intentions and limiting businesses’ plans to hire and invest.

At the same time, Macklem said the bank “will proceed carefully with any further changes” to borrowing costs, and officials would “need to assess both the upward pressures on inflation from higher costs and the downward pressures from weaker demand.”

Bottom Line

These are uncertain times. The US is determined to impose worldwide tariffs, disproportionately hitting Canada, Mexico, and China, the US’s top trading partners. This is a misguided neo-Mercantilist policy. Mercantilism assumes that the global economic pie is fixed, so if one country prospers, another must fail. This idea of a zero-sum game was debunked in the 18th century by Adam Smith and others who showed that if countries have a competitive advantage in various products and services, all are better off by producing and trading those products with the rest of the world. It is not a zero-sum game. The economic pie grows with trade. This was the idea behind globalization and the USMCA free trade agreement.

Given Canada’s vulnerability to tariffs, the economy will suffer more than the US, which has a relatively closed economy (where exports are a small proportion of GDP). Prices will rise depending on the duration and size of the coming tariffs, but mitigating the inflation will be the weakness in economic activity. Stagflation, a buzz-word in the 1970s, is back in the lexicon. We expect the BoC to continue cutting the policy rate in 25-bps increments until it reaches 2.25% this June, triggering a rebound in home sales. Layoffs and spending cuts will dampen sentiment, but lower interest rates will bring buyers off the sidelines.

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. 

January 2025 Newsletter

General Angela Calla 4 Feb

Welcome to the January issue of my monthly newsletter!
Happy New Year!
This month, I wanted to take a look at what is in store for us for the housing market as we head into 2025. Plus, I have some tips to help kick your financial health into gear for the next twelve months! Scroll down for all the details.

Market Outlook for 2025

It’s a new year and as we gear up for the upcoming Spring season, it is a good idea to take a look at the market outlook and what we are expecting to see around housing sales, prices, interest rates, and how these current conditions affect buyers versus sellers!

Let’s dive into the Canadian Real Estate Association Forecast and more:

National Trends

  • Housing Sales: National home sales are expected to increase by 6.6% in 2025, reaching approximately 499,800 units as interest rates continue to decline, drawing buyers back into the market. This follows a modest 5.2% increase in 2024.
  • Housing Prices:On a national level, Canada’s housing market is expected to see a 4.4% increase in home prices in 2025, reaching an average of $713,375. This follows a more modest 0.9% increase in 2024. The national growth is tempered by regional differences, with areas like Toronto and Vancouver seeing higher price levels due to ongoing demand, while more affordable regions like Quebec may see more moderate growth.
  • Rising Demand: Canada’s housing market remains competitive, with demand continuing to rise in urban centers and suburban areas due to factors like population growth, economic recovery, and strong immigration.
  • Interest Rates: The Bank of Canada’s policy on interest rates continues to play a central role in shaping the housing market. While rates were higher through 2023 and part of 2024, they are expected to continue declining in 2025, which should ease affordability constraints and encourage more buyer activity.

Regional Highlights

Greater Toronto Area (GTA)

  • Housing Prices:The average home price in the GTA reached $1,135,215 in October 2024, reflecting a 0.8% increase year-over-year and 2.5% monthly growth. The City of Toronto itself saw a 3.4% increase, signaling continued demand despite higher prices. Areas like Mississauga and Brampton show mixed price trends, with Mississauga seeing a slight decline of 2.2% year-over-year, while Brampton experienced a 2.0% increase. These fluctuations reflect demand in more affordable areas within the GTA.
  • Rising Demand: Toronto remains one of Canada’s most sought-after markets, driven by its status as a global financial hub and growing tech sector. Suburbs like Mississauga, Brampton, and York Region are seeing rising interest as buyers seek more affordable options. Ontario’s strong job market and immigration influx contribute to population growth, further boosting demand. While some cooling has been seen due to high home prices, the overall demand remains robust, especially for entry-level homes.
  • Interest Rate Impact: Rates are expected to decrease into 2025 increasing buyer demand. Despite higher rates over the last two years, Toronto remains a seller’s market in many areas, though buyers will benefit from more favorable conditions as rates decline.

Greater Vancouver

  • Housing Prices: Vancouver has experienced a slight decline in average home prices, down 0.2% year-over-year in 2024, with prices hovering around $1,250,329. However, Vancouver remains one of Canada’s priciest markets, and some recovery is expected as the market adjusts. While the downtown core sees slower price growth, suburban areas in the Lower Mainland, such as Richmond and Surrey, continue to see moderate price increases, as these areas offer better affordability and space.
  • Rising Demand: Vancouver’s appeal remains strong for both domestic buyers and international investors, particularly in tech, entertainment, and natural resources sectors. Despite price stagnation, demand continues for detached homes and more spacious properties as residents seek to balance living costs with quality of life. Vancouver also benefits from significant immigration, and the city continues to diversify economically, drawing both residents and investors who are fueling demand in the housing market.
  • Interest Rate Impact: Like Toronto, Vancouver has been affected by the Bank of Canada’s interest rate hikes, which have increased borrowing costs and cooled market activity. The rate hikes have caused some slowdown, but the region is expected to see a modest recovery in 2025 with interest rate cuts. As rates decline, Vancouver may experience more balanced market conditions, with higher demand for detached homes in suburban areas and some recovery in the more expensive core areas.

Quebec:

  • Housing Prices:The province has seen steady growth in home prices, with Montreal, in particular, experiencing an 8.9% year-over-year price increase as of October 2024, reaching an average home price of $630,063. While Quebec’s growth is generally more moderate compared to Ontario and British Columbia, the relative affordability of homes in many areas still offers opportunities for buyers compared to more expensive regions like Toronto or Vancouver.
  • Rising Demand: Montreal’s job market, particularly in technology and aerospace, continues to attract young professionals, which fuels housing demand. The province also benefits from ongoing immigration, contributing to population growth, which supports housing demand.
  • Interest Rate Impact: Like the rest of Canada, Quebec will see easing interest rates in 2025, which should help to bolster market activity. However, since prices have risen significantly over the past decade, some buyers in Quebec, particularly first-time buyers, may still face affordability challenges, albeit less severe than in major cities like Toronto.

Expectations for Buyers

  1. Affordability Challenges: While interest rates are expected to decline gradually, the impact of high housing prices in major cities like Toronto and Vancouver will still be a challenge for many buyers. However, some relief is anticipated as lower rates could ease monthly mortgage payments.
  2. Opportunity in the Suburbs: Suburban areas are projected to see more price stability and may be more attractive to first-time buyers and those looking for better value for money. Areas like Mississauga, Brampton, and Ottawa are seeing mixed price changes, making them viable alternatives to the high-cost core regions.
  3. More Inventory: A growing number of homes available for sale could give buyers more choice, but competition may still exist in certain markets due to demand returning as rates ease.

Expectations for Sellers

  1. Tight Timing: Sellers in 2025 will likely benefit from a surge in demand in the spring and summer, driven by the stabilization or decline of interest rates. However, selling in a market with increased inventory may require competitive pricing.
  2. Realistic Pricing: With the market expected to shift towards more buyer-friendly conditions, sellers will need to adjust expectations and price their homes carefully. Those listing too high might face longer waiting periods.
  3. Stronger Negotiation Power in Suburbs: Sellers in high-demand, low-inventory areas (especially in suburban regions) may still enjoy more favorable conditions and could see prices rise or remain stable.

Key Takeaways for 2025

  1. Recovery Driven by Rate Cuts: Declining interest rates are anticipated to accelerate both sales activity and price growth in the latter half of 2025.
  2. Regional Disparities: While Vancouver and Toronto remain expensive, other regions like Montreal and Ottawa offer growth potential due to relative affordability and robust economic conditions.
  3. Inventory and New Construction: Higher inventory levels may moderate price increases in some areas, but affordability concerns and economic factors will shape regional market dynamics.

Overall, 2025 will likely be a year of transition with benefits to both buyers and sellers as the market continues to stabilize.

Looking to purchase or renew your mortgage this year? Don’t hesitate to reach out to me

Kickstart Your Year:
5 Steps to Improve Your Financial Health

Improving your financial health is essential for long-term stability and peace of mind.

STEP 1: This starts with creating a budget and sticking to it. Begin by tracking your income and all expenses for at least a month to understand where your money is going.

  • Categorize your spending into essentials (housing, utilities, groceries) and non-essentials (entertainment, subscriptions). Use this information to set realistic spending limits and prioritize needs over wants.
  • Apps and tools can also make budgeting easier and more effective.

STEP 2: Next is to build an emergency fund. Life is unpredictable, and having a financial cushion can prevent setbacks from turning into crises.

  • Aim to save 3–6 months’ worth of living expenses, but don’t be discouraged if that feels daunting.
  • Start small, even $10–$20 from each paycheck, and automate your savings to ensure consistency. Over time, these small contributions will grow into a safety net.

STEP 3: Debt can be a significant barrier to financial health, so it’s crucial to pay down debt strategically. High-interest debt, like credit cards and payday loans, should be your top priority, as it compounds quickly and can drain your resources.

  • Use strategies such as the snowball method (paying off the smallest debts first for psychological wins) or the avalanche method (focusing on the highest-interest debts to save money overall). Whichever method you choose, ensure you make at least the minimum payments on all debts to avoid penalties.

STEP 4: Another vital component of financial health is to invest in your future.

  • Begin contributing to retirement accounts, such as an RRSP if your employer offers one, especially if there’s a company match—it’s essentially free money.
  • If an RRSP is not an option, consider a high-interest savings account.
  • Beyond retirement, explore low-risk investments, which can grow your wealth steadily over time. Even small, consistent contributions can lead to significant returns thanks to compound interest.

STEP 5: It’s essential to regularly review and adjust your financial plan. Financial needs and goals evolve, so take time annually—or after major life events like a new job, marriage, or a baby—to reassess.

  • Review your budget, savings, investments, and debt repayment progress. Adjust your plan as needed to stay on track and adapt to changes.
  • Regular check-ins help you stay proactive and maintain momentum toward your goals.

Financial health is a journey, not a destination. Consistency, patience, and smart planning will lead you to long-term stability and financial freedom. Remember, even small steps make a big difference over time!

Economic Insights from Dr. Sherry Cooper

There is an unprecedented disparity between the economic and financial situation in the US and Canada. The Canadian economy is far more interest-sensitive than the US and, therefore, slowed more dramatically in response to the Bank of Canada’s restrictive policy to bring inflation back to its 2% target level.

The jobless rate in Canada has reached 6.5%, well above the level in the US, and job vacancy rates have plummeted. Wage inflation has been sticky at 4.9% but will likely edge downward in response to excess supply in the labour market.

Inflation accelerated to 2% y/y in October, compared to the cycle-low 1.6% in September, mainly because gasoline price deflation slowed. The odds of another 50 bps rate cut by the central bank—on the heels of a jumbo cut in October—have diminished, but a 25 bps cut is in the bag.

Market-driven interest rates in Canada are well below those in the US, owing to weaker economic activity and lower inflation. US interest rates surged on the news of the Trump election victory. Ten-year US Treasury yields rose sharply to a post-election high of nearly 4.5% on the presumption that with a Republican majority in the House and the Senate, Trump will move ahead with tax cuts, tariffs and deregulation. Trump has also threatened to limit the independence of the Federal Reserve.

Canadian long-term yields have risen far less since the election. Short-term interest rates are also lower in Canada than in the US. The Bank of Canada has eased monetary policy four times for a total decline in the overnight policy rate of 175 bps, compared to only one rate cut of 50 bps by the Fed. This unprecedented divergence bodes well for a rebounding housing market in Canada.

Housing activity picked up in October and early November in response to the surge in new listings, giving potential buyers a broader range of choices and lower interest rates. The steepening yield curve portends more significant declines in variable mortgage rates—tied to the prime rate, which declines with every cut in the overnight rate, than fixed rates, which move with longer-term bond yields.

The Bank of Canada, concerned about a weakening Canadian economy, will continue to cut the overnight rate at every meeting between now and mid-2025. By then, the policy rate will be roughly 2.5%, half the level at the peak in BoC tightening. This will likely trigger a robust spring housing season.

There is plenty of pent-up activity in the Canadian housing market as buyers have waited for lower interest rates and home prices, and sellers have been reticent to list their properties, hoping for a housing recovery. This is beginning to turn around as every easing move by the Bank of Canada boosts economic activity, particularly in the interest-sensitive housing sector.

 

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. 

Angela Calla on Global News What you NEED to know Variable & Adjustable Rate Mortgages

General Angela Calla 27 Jan

In case you missed our Global News Morning segment we discussed a topic that is top of mind for many: variable and adjustable rate mortgages.

In this approx. 6 minute interview we covered…

-What exactly are variable and adjustable rate mortgages?

-The key differences between the two.

-Critical terms and factors to consider when choosing the best option for you.

If you ever wondered how these mortgage options work or how to make the most informed decision, this segment is a must-watch!

We are here to or provide a personalized review of a mortgage for you or a loved one to ensure it works for you in today’s market to build and protect your wealth please email us at callateam@countoncalla.ca or call 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. 

Fall Economic Statement Delivered Despite Chrystia Freeland’s Resignation

General Angela Calla 18 Dec

 
Chrystia Freeland Resigns On The Day of The Fall Economic Statement
Finance Minister Freeland rocked markets today by submitting her resignation from Cabinet. Trudeau had asked her to take another Cabinet post, but she declined in a scathing letter accusing Trudeau of “costly political gimmicks” like “bribe-us-with-our-own-money cheques for $250 and a two-month GST holiday.

“Inevitably, our time in government will come to an end,” Ms. Freeland said, openly acknowledging what polls have been saying for over a year. “But how we deal with the threat our country currently faces will define us for a generation, and perhaps longer.”

The Federal deficit for 2023-2024 grows from $40 billion to $61.9 billion, partly boosted by a court settlement to pay funds to Indigenous children. The deficit far surpasses Freeland’s guardrail of $40.1 billion for last year’s budget deficit. New spending initiatives were announced amounting to $24 billion over the next six years. The most significant component is accelerated incentives to encourage business investment to improve productivity. This is very similar to a program issued by Finance Minister Frank Morneau years ago.

Dominic LeBlanc has been sworn in as the new Finance Minister.
Bottom Line

Today’s Fall Economic Statement took a backseat to the news that Chrytia Freeland resigned. There is more talk of a Trudeau resignation and an early election. Liberals are suggesting that Trudeau has stayed on too long, likening him to Biden. The caucus is meeting at 5 PM today.
Dr. Sherry Cooper
Chief Economist, Dominion Lending Centres
drsherrycooper@dominionlending.ca

 

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. 

 

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