Canadian home sales rose again in November as new listings declined and prices rose

General Angela Calla 18 Dec

The Canadian Housing Market Strengthens Further

Home sales activity recorded over Canadian MLS® Systems rose again in November, building on October’s surprise jump.

Sales were up 2.8% m/m in November compared to October and now stand a cumulative 18.4% above where they were in May, just before the first interest rate cut in early June. Actual (not seasonally adjusted) monthly activity was 26% above November 2023.

The November increase was driven by gains in Greater Vancouver, Calgary, Greater Toronto, and Montreal and double-digit sales increases in smaller cities in Alberta and Ontario.

According to Shaun Cathcart, CREA’s Senior Economist, “Not only were sales up again but with market conditions now starting to tighten up, November also saw prices move materially higher at the national level for the first time in almost a year and a half. Normally, we might expect this market rebound to take a pause before resuming in the spring; however, the Bank of Canada’s latest 50-basis point cut together with a loosening of mortgage rules could mean a more active winter market than normal.”

New Listings

New listings edged down 0.5% month-over-month in November, building on a larger 3% decline in October. With sales also rising in November, the national sales-to-new listings ratio tightened to 59.2%, up from 57.3% in October. Between April and September this year, the measure had been in the 52% to 53% range. The long-term average for the national sales-to-new listings ratio is 55%, with a sales-to-new listings ratio between 45% and 65%, generally consistent with balanced housing market conditions.

“October and November marked the start of the long-awaited rebound in resale housing activity, with the combination of lower borrowing costs and more properties to choose from coaxing buyers off the sidelines,” said James Mabey, CREA Chair.

A little more than 160,000 properties were listed for sale on all Canadian MLS® Systems at the end of November 2024, up 8.9% from a year earlier but still below the long-term average for that time of the year of around 178,000 listings.

There were 3.7 months of inventory nationally at the end of November 2024, down from 3.8 months at the end of October and the lowest level in 14 months. The long-term average is 5.1 months of inventory, with a seller’s market below about 3.6 months and a buyer’s market above 6.5 months.

 

 

 

 

Home Prices

The non-seasonally adjusted National Composite MLS® HPI stood 1.2% below November 2023, the smallest decline since last April. The non-seasonally adjusted national average home price was $694,411 in November 2024, up 7.4% from November 2023.

 

Bottom Line

The Bank of Canada’s aggressive rate-cutting and regulatory changes that make housing somewhat more affordable have provided kindling for the Canadian housing market. While the conflagration isn’t likely to peak until spring, a seasonally strong period for housing, activity has already started to pick up. The November uptick in home prices could provide more impetus for potential buyers to move off the sidelines. The new housing initiatives go into effect today and tomorrow.

Debt-to-income ratios for Canadian households have improved as growth in disposable incomes continues to outpace borrowing. This bodes well for more robust residential real estate activity as the Bank of Canada continues to cut rates, albeit at a slower pace. We expect quarter-point rate cuts until the overnight rate, now at 3.25%, falls to 2.5% or even lower if US tariffs are introduced.

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. 

With rates going down, should I take an adjustable rate Mortgage?

General Angela Calla 16 Dec

Navigating the mortgage market requires more than choosing between a fixed or adjustable rate. Over my 20 years in this industry, I’ve seen how markets and lenders adapt in ways consumers might not expect. Adjustable rates can be a VERY powerful tool, but they come with complexities that borrowers must fully understand before committing.

Our approach at the Angela Calla Mortgage Team is not to say adjustable rates are bad or banks are at fault. Instead, we work to empower borrowers by presenting all qualified options and using our experience to help them make confident, informed decisions they’re comfortable with. For instance, adjustable and variable-rate mortgages often come with significant advantages such as large discounts, low compounding frequencies, and only three months of interest for penalties, as well as the flexibility to easily lock into fixed rates when needed.

Here are some important lessons from recent history that highlight the factors borrowers need to consider:

2015: BoC Rate Cuts That Didn’t Fully Benefit Borrowers

In January and July 2015, the Bank of Canada (BoC) reduced its overnight rate twice, by 0.25% each time (a total of 50 basis points). Despite this, Canadian banks only passed along 0.45% (45 basis points) of the cuts, keeping 0.30% for themselves.

This situation highlighted that central bank decisions don’t always translate directly into borrower savings. That missing 0.30% never made its way back to consumers.

2016: Independent Prime Rate Adjustment by a Major Bank

In 2016, one of Canada’s major banks introduced its own proprietary prime rate, setting it slightly higher than the industry-standard prime rate. While most adjustable-rate borrowers didn’t notice because their payments stayed the same, more of their payments were applied to interest instead of principal.

This independent adjustment demonstrated how lenders can make changes that impact borrowers in ways they may not immediately notice. Adjustable-rate mortgages, where payments change with Prime, and variable-rate mortgages, where the interest rate changes but payments may remain constant, further illustrate how adjustable rates are not all the same in mechanics or benefits.

2021-2022: Tiff Macklem’s Reassurance and the Rate Surge

In 2021, Bank of Canada Governor Tiff Macklem assured Canadians that rates would remain low for a prolonged period. This led many borrowers to choose variable-rate mortgages, believing they’d benefit from sustained savings.

However, by 2022, the BoC raised rates rapidly to combat inflation, pushing them to the highest levels in over a decade. Borrowers with adjustable-rate mortgages (ARMs) faced significant payment increases, while variable-rate mortgages hit trigger rates, leading to grossly extended amortization periods in some cases.

Rapid Rate Movements and Market Surcharges

When rates move quickly, lenders may also surcharge adjustable-rate offerings. For example, instead of offering Prime – 0.50%, lenders might adjust to Prime – 0.10% or even Prime + 0. This means the actual discount off prime becomes less favourable, directly impacting borrowers’ costs.

Evaluating the actual discount from prime, rather than focusing solely on the rate, is critical when considering adjustable-rate mortgages.

Financial Empathy During Uncertain Times

In industries prone to strikes or sudden income changes, lenders vary widely in their approach to financial empathy. Some lenders are quick to damage a borrower’s credit score or refuse to renew existing mortgages during difficult times. Others show understanding by offering deferred payment options to help borrowers weather financial challenges.

With our ever-changing market, assessing a lender’s flexibility and empathy is a vital part of the evaluation process. These factors, along with rate comparisons, go into the discussions we have with clients to ensure they’re set up for success in any scenario.

What You’ll Learn in The Mortgage Code

I explore these topics and more in my book, The Mortgage Code. This guide gives borrowers the tools they need to navigate the mortgage market with confidence, helping them understand how factors like market shifts, lender policies, and economic uncertainty can affect their financial future.

Order The Mortgage Code on Amazon. https://www.amazon.ca/Mortgage-Code-Helping-Property-Mistakes-ebook/dp/B07HFHR8TV

Key Takeaways for Borrowers

Understand the risks and rewards: Adjustable rates can offer flexibility and savings, but they come with unpredictability.

Evaluate lender policies: Consider how your lender handles deferred payments, renewals, and financial hardships.

Stay informed about rate discounts: The actual discount off prime, lock-in policies, and penalties matter in addition to just the rate itself.

Work with a trusted advisor: Our experience ensures every aspect of your financial situation is considered, not just the numbers.

 

Mortgage decisions are more than just choosing between fixed and adjustable rates—they’re about finding the right fit for your life and goals. Let’s work together to ensure you have clarity and confidence in every decision.

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. 

The Bank of Canada Cuts Its Policy Rate By Another 50 Basis Points

General Angela Calla 12 Dec

The Surge In Canadian Unemployment Keeps Another Jumbo Rate Cut In Play In December

The BoC slashed the overnight rate by 50 bps this morning, bringing the policy rate down to 3.25%. The market had priced in nearly 90% odds of a 50 bp move, where consensus coalesced. The combined slower-than-expected GDP growth and a sharp rise in the Canadian unemployment rate to 6.8% triggered the Bank’s second consecutive jumbo rate cut. Today’s move will take the prime rate down 50 bps to 5.45% effective tomorrow, reducing floating rate mortgage loan rates by a half point, easing the cost of borrowing and reducing the monthly payment increase for renewals. This should spark housing activity, which accelerated in October and November.

The policy rate is now at the top of the estimated neutral rate range, 2.25% to 3.25%, with more moderate rate cuts continuing into next year. However, monetary policy remains restrictive, as the 3.25% policy rate is still 125 basis points above inflation, which has declined to roughly 2%, the Bank’s inflation target.

Economists have suggested that the tone of the central bank’s press release is more hawkish than before, unsurprising following two consecutive jumbo rate cuts. The Bank continues to say that its future decisions are data-dependent and will be impacted by policy measures taken by the government. In particular, the Bank highlighted the coming GST cuts, dispersal of bonus checks and the significant reduction in immigration. These developments have offsetting implications for inflation.

Governor Macklem signalled that he anticipated “a more gradual approach to monetary policy” in his press conference. We are forecasting 25 bp rate cuts through at least the first half of next year. That would take the overnight rate down to 2.5% by early June, a huge boost to housing that will likely enjoy a strong spring season.

 

 

 

 

 

Monetary policy remains overly restrictive as the 3.75% overnight policy rate remains well above the inflation rate. We expect the overnight rate to fall to 2.5% by April or June of next year. This should continue boosting housing activity, which increased significantly in October and November.

Last week’s GDP data release showed that Canada’s third-quarter GDP grew a mere 1.0%, well below the Bank’s downwardly revised forecast of 1.5%. This, in combination with today’s employment report, bodes well for the Bank of Canada to consider cutting rates by another 50 bps seriously. However, given how aggressive they have been compared to the Federal Reserve, which will undoubtedly cut rates by only 25 bps in late December, they could be satisfied with a 25 bp cut for now.

 

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. 

New Insurer Rules Recap

General Angela Calla 10 Dec

New Rules Recap

As you may already know, we have some great new rules coming into effect on December 15th.

Want a quick recap? Here you go:

30yr amortizations:

Purchase price increase:

  • The purchase price of an insured purchase goes up to $1.5M
  • Downpayment: Remains 5% of the first $500K and 10% of the balance

Have more questions? Reach out to us directly at callateam@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. 

December 2024 Newsletter

General Angela Calla 3 Dec

Welcome to the December issue of my monthly newsletter!
As the end of the year approaches, I wanted to have one more check-in with you and provide some final tips for 2024! Scroll down and check out my favourite home and finance resolutions, along with some tips for decluttering your home in preparation for 2025. Have a great month!

Resolutions for Your Home and Finances

As the new year approaches, it’s a natural time to reflect on our personal goals and set resolutions for the months ahead. Your home and finances are key areas where small, intentional changes can lead to big improvements in security, stability, and quality of life.

Here are some resolutions to get you started!

Create a Realistic Home Budget

A well-planned budget is essential for financial peace of mind. Whether you’re new to budgeting or want to refine your approach, creating a realistic budget helps prioritize spending, track bills, and put money toward meaningful goals.

  • Identify Fixed and Variable Expenses: List out fixed costs, like mortgage payments, utilities, and insurance, as well as variable ones, such as groceries and entertainment.
  • Set Savings Goals: Include savings as a “non-negotiable” in your budget, earmarking funds for home repairs, investments, or emergencies.
  • Track and Adjust: Track spending throughout the month and adjust where necessary. Financial apps like Mint or You Need a Budget (YNAB) make it easier to stay on course.

Set Goals to Build Home Equity

Building home equity is a key path to increasing net worth. Whether you’re planning to sell or stay in your home long-term, building equity can offer financial flexibility and security.

  • Make Extra Mortgage Payments: Even a small additional payment toward your mortgage principal each month can shorten your loan term and reduce interest costs. A biweekly payment plan is another effective method to pay down the principal faster.
  • Consider Strategic Home Improvements: Invest in upgrades that boost home value, like kitchen and bathroom remodels, or energy-efficient upgrades like new windows or solar panels. Prioritize improvements that add the most value to your property.

Develop a Plan to Pay Down Debt

Paying down debt (especially after the holidays!) can help free up cash flow. It is key to focus on high-interest debts first, such as credit cards, to maximize your payments.

  • Use the Debt Avalanche or Snowball Method: The avalanche method involves paying off high-interest debts first, while the snowball method focuses on smaller debts first. Choose the one that best fits your motivation style
  • Consider Refinancing or Consolidation: If you have a high-interest mortgage or multiple debts, refinancing or consolidating might reduce interest rates, making debt repayment more manageable
  • Celebrate Milestones: Paying off debt can feel challenging, so celebrate progress. Every milestone achieved brings you closer to financial freedom.?

Commit to Energy Efficiency to Lower Bills

Saving on energy costs can have a significant impact on your budget, especially in colder or warmer months. Simple changes around the home can save you money while benefiting the environment!

  • Invest in Smart Thermostats: A programmable thermostat can automatically adjust heating and cooling based on your schedule, saving energy when you’re not home.
  • Switch to LED Lighting: LED bulbs use significantly less energy and have a longer lifespan than traditional bulbs.
  • Insulate Windows and Doors: Adding weatherstripping to doors and windows keeps drafts out, making your heating and cooling systems more efficient.

Review Your Insurance Policies and Coverage

Insurance is a key element of financial security, but it’s easy to forget about it until something goes wrong. As you head into the new year, this is a great time to make sure you’re fully covered!

  • Assess Homeowners and Mortgage Insurance: Review coverage limits and ensure your policy covers potential risks, including natural disasters if you live in high-risk areas.
  • Shop for Better Rates: Contact your provider for discounts or shop around for new rates. Bundling policies, like home and auto insurance, can often yield savings.
  • Update Beneficiaries and Coverage: Life circumstances change, and your insurance should reflect that. Update your beneficiaries, adjust coverage, and ensure policies align with your financial goals.

Setting resolutions for your home and finances doesn’t have to be daunting! Start with small, actionable goals to help transform your finances – and your mindset – for 2025!

12 Tips for Decluttering Your Space

Decluttering can bring a sense of calm and order to your space, especially as the holiday season approaches.

 

Here are some practical tips to help get organized:

  1. Start Small and Set Achievable Goals: Avoid overwhelm by breaking down the decluttering process into manageable steps. Set realistic goals, such as dedicating just 15 minutes a day to tidying up. Begin with a small area—like a single drawer or shelf—and gradually expand to larger spaces as you build momentum and confidence.
  2. Use the “One-In, One-Out” Rule: For every new item you bring into your home, make it a rule to remove an old one. This simple habit keeps your space from accumulating unnecessary items and helps maintain a balanced, organized environment.
  3. Sort and Categorize with Purpose: Sorting items as you go makes it easier to stay organized and keep track of where everything belongs. Use boxes or bins labeled “Keep,” “Donate,” “Sell,” and “Recycle/Trash” to give each item a clear destination. This method ensures that you can tackle everything in one go without second-guessing.
  4. Focus on Essentials and Joy: When deciding what to keep, ask yourself, “Does this item serve a purpose, or does it bring me joy?” If the answer is no, it’s probably time to let it go. Focusing on essentials and things that spark joy can help you make more meaningful decisions about what truly belongs in your home.
  5. Digitize Paper Clutter: Free up physical space by scanning or photographing important documents and storing them digitally. Use cloud storage or an external hard drive to keep these files secure and easily accessible. This practice reduces paper clutter and provides a backup in case of loss or damage.
  6. Declutter in Layers for Lasting Results: Tackle clutter in layers to avoid feeling overwhelmed. Start with the most obvious items—like broken or rarely used belongings—and gradually work your way through more sentimental or difficult-to-decide items. Revisiting each area multiple times helps you refine your space down to the things you truly need or cherish.
  7. Adopt a “Capsule” Mindset for Clothes and Accessories: Build a capsule wardrobe by focusing on versatile, high-quality clothing pieces that you love and regularly wear. Store out-of-season items separately to keep your main closet neat and functional. This approach simplifies decision-making and can make daily routines smoother.
  8. Set Up Regular Decluttering Routines: Make decluttering a habit by scheduling quick, regular clean-ups—a few minutes each day or a larger session every month. Consistency prevents clutter from building up over time and helps you maintain a tidy, organized space effortlessly.
  9. Involve the Whole Family: Encourage family members to declutter their own spaces and lead by example. Demonstrating the benefits of a tidy, organized home can inspire everyone to participate, making the whole process faster and more enjoyable.
  10. Treat Your Space as “Prime Real Estate”: View the most visible and accessible areas of your home as “prime real estate.” Reserve these spaces for the items you use and love the most, and relocate or discard things that aren’t worth taking up valuable room.
  11. Embrace Simple Storage Solutions: Use baskets, bins, and clear containers to keep your belongings organized and out of sight. Labeling containers makes it easy to find what you need at a glance, keeping everything in order while reducing visual clutter.
  12. Reevaluate Seasonal Items Regularly: After each season, go through holiday decorations, seasonal clothing, and other temporary items to decide what’s worth keeping. Donate, sell, or discard anything you no longer use. This ongoing process will help prevent excess accumulation year after year.

 

These tips can help you create a cleaner, more peaceful environment and build habits to stay organized in the long term. Happy decluttering!

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 125 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. 

55+, Equity-Rich But Cash-Poor?

General Angela Calla 28 Nov

I’d like to share some important information about reverse mortgages, a financial tool that is often misunderstood but can provide incredible benefits for Canadian homeowners aged 55 and older.

There’s a lot of misinformation surrounding reverse mortgages, so let’s set the record straight:

  1. Myth: The bank will own my home.
    Truth: You remain the homeowner and keep the title.
  2. Myth: I’ll owe more than my home’s worth.
    Truth: Reverse mortgages in Canada have safeguards to ensure you won’t owe more than the home’s value.
  3. Myth: It’s only for people in financial trouble.
    Truth: Many clients use reverse mortgages for smart financial planning, such as funding retirement or helping loved ones.

The Benefits of a Reverse Mortgage

A reverse mortgage allows you to:

  • Access up to 55% of your home’s value, tax-free.
  • Stay in the home you love without monthly mortgage payments.
  • Use the funds however you like—renovations, travel, helping loved ones with tuition or a down payment or supplementing retirement income.

A Real-Life Example

Let me introduce you to Mark and Susan, a retired couple who found themselves house-rich but cash-poor. They loved their home of 30 years and didn’t want to downsize, but they needed funds to cover rising living expenses and help their granddaughter with tuition.

Through a reverse mortgage, Mark and Susan unlocked $250,000 from their home equity, tax-free. They were able to:

  • Cover their granddaughter’s tuition without dipping into their savings.
  • Make long-overdue home renovations.
  • Enjoy a worry-free retirement with financial flexibility.

When their home is eventually sold, the loan will be repaid, and their children will still inherit the remaining equity.

Could This Be Right for You?

If you’re curious about how a reverse mortgage might fit into your financial plan, we’d be happy to connect to discuss your options.

Let’s chat! Simply reply to this email, or feel free to call us at 604-802-3983 to set up a no-obligation consultation.

Looking forward to helping you make the most of your retirement!

P.S. Know someone else who could benefit from this information? Feel free to forward this information to them!

 

 

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. 

November 2024 Newsletter

General Angela Calla 5 Nov

Welcome to the November issue of my monthly newsletter!
This month, I wanted to highlight some tips around refinancing your mortgage and considerations to make at renewal time! Plus, with the holidays just around the corner, I have included some of my favourite DiY gifting ideas to help get you started! Scroll down for all the details.

Refinancing Your Mortgage

Refinancing your mortgage can be a smart financial move for many reasons, and as your trusted mortgage advisor, I’ve seen how much it can benefit homeowners!

Ideally, refinancing is done at the end of your mortgage term to avoid penalties, but the timing can vary depending on your goals.

For some, it’s about unlocking the equity in their home to fund renovations or cover big expenses like college tuition. For others, it’s an opportunity to consolidate debt, lower their interest rate, or change up their mortgage product.

Let’s take a closer look at some of the ways refinancing your mortgage can help!

  • Get a Better Rate: As interest rates have continued to decrease with the Bank of Canada updates these past few months, now is a great time to consider refinancing for a better rate and lower overall mortgage payments! Experts anticipate the Bank of Canada will move to have the overnight rate down to 2.75% next year.
  • Consolidate Debt: When it comes to renewal season and considering a refinance, this is a great time to review your existing debt and determine whether or not you want to consolidate it onto your mortgage. In most cases, the interest rate on your mortgage is less than you would be charged with credit card companies or other forms of financing you may have. Plus, having all your debt consolidated into a single payment can keep you on track!
  • Unlock Your Home Equity: Do you have projects around the house you’ve been dying to get started on? Need funds for a large purchase such as a new vehicle or post-secondary education? When you are looking to renew your mortgage, it is a great opportunity to consider refinancing in order to take advantage of the home equity you have built up to help with these larger changes in your life!
  • Change Your Mortgage Product: Are you unhappy with your existing mortgage product? If you have a variable-rate or adjustable-rate mortgage, you may be considering locking it in at the lower rates. Alternatively, you may want to switch your current fixed-rate mortgage to a variable option with the interest rates expected to continue decreasing into 2025. You can also utilize your refinance to take advantage of a different payment or amortization schedule to help pay off your mortgage faster!

PLUS! Some latest changes by the Government of Canada will make it even easier for you when it comes to your renewal and refinancing options:

  • Those of you who may have an uninsured mortgage will no longer have to pass the stress test as of November 21st. This means that you have more flexibility when it comes to rates and mortgage products in renewal cases where you wish to switch lenders without adding additional funds to your mortgage!
  • Beginning January 15, the federal government will allow default-insured mortgages to be refinanced to build a secondary suite. If you’ve been considering adding a suite to your property, you may be eligible to access up to 90% of your home’s equity for this purpose.

No matter your plans or situation, please don’t hesitate to reach out to me for expert mortgage advice!

DiY Holiday Gifting Idea

Looking for some creative and thoughtful DIY holiday gifting ideas that are easy to make and can add a personal touch to your gifts this season?

These affordable, fun, and personalized options can suit anyone in your life – and they’ve never been easier to make

  • Homemade Scented Candles: These are easy to make requiring only a few ingredients but can be a great statement for friends and family! Pick their favourite scent in essential oil (lavender, peppermint, cinnamon, sage, etc.) and mix in with melted wax and pour into jars with a wick! Plus, you can customize them further with fun holiday-themed tags or labels on the jars.
  • DiY Bath Bombs: Surprisingly easy to make, these bath bombs pair especially well with a homemade candle or handmade soap for the ultimate personal-scented bath set! Requiring just baking soda, citric acid, Epsom salts and essential oils to set in molds, these are a fun, low-cost gift idea!
  • Handmade Soaps: Another great gift idea to make a personalized statement are handmade soaps! All you need is a soap base, essential oils, and additives to pour into molds to set! Want to get extra personalized? Find unique and fun molds that celebrate the personality of that friend or family member.
  • Personalized Photo Calendars: Fun for the whole family, personalized calendars can be a great way to snapshot your previous year and highlight the good times as you head through 2025! You can have these created online or do it yourself by printing photos and a template, binding the pages with ribbon, and adding handwritten, personal notes on special dates!
  • Custom Recipe Book: Do you have fun family recipes or have friends with a list of top treats? Why not create a custom recipe book with their favourite eats! All you need is a blank notebook or binder, printed recipes plus some photos for added personalization.
  • Knitted Outdoor Wear: With the temperatures starting to drop, why not give the gift of comfort with a scarf or hat knitted with love? Combine their favourite colours or patterns and even add a personalized name tag!

The season of giving has never been easier with these affordable, fun and personalized gift ideas for all those special folks in your life.

Economic Insights from Dr. Sherry Cooper

The 2024-2026 mortgage renewals “cliff” is manageable as long as the Bank of Canada cuts interest rates and the job market and economy don’t weaken too much. Owing to the 75 basis point rate decline through September and the 50 bps cut in October, not all mortgages will renew at higher rates next year.

Royal Bank economists estimate that total mortgage payments in 2025 will increase by about 0.1% of total household disposable income as many extend amortizations to keep payments low.

The jobless rate, though declining a tick in September to 6.5%, is meaningfully higher than before the pandemic and is likely to rise to 7% next year.

The total number of job openings in the economy is 25% below what it was a year ago, and if it were to weaken further, the unemployment rate would rise even more.

Earlier this cycle, there were more job vacancies than people looking for work, so the drop in job openings didn’t have a material impact on the economy. But that’s no longer the case. September’s inflation data confirms that the job market trend is downward.

Economic growth has been below potential since 2022, and preliminary third-quarter data indicate another slowdown to about 1.3% growth in Q3, well below the BoC’s initial forecast. Hiring intentions remain woefully inadequate in the face of staggering population growth.

Business start-ups are also sluggish, reflecting a business climate undermined by overly restrictive monetary policy.

The BoC must now aggressively cut interest rates. Monetary policy remains highly restrictive.

The Bank of Canada’s Business Outlook Survey shows no sign of stabilization in the short term. Indeed, hiring intentions were virtually unchanged in Q3 and remained below the historical average. A significant number of companies are overstaffed.

The latest data show that the private sector vacancy rate is plummeting and has reached its lowest level since 2016. More than half of all small- and medium-sized businesses are fearful of weakening demand for their goods and services.

The number of active companies fell sharply in the second quarter due to a sharp jump in business closures and a low number of start-ups. The stagnation in the number of active companies in Canada since 2022 is undoubtedly one consequence of the extremely powerful tightening of monetary policy.

 

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. 

More Good News On The Canadian Inflation Front

General Angela Calla 17 Oct

The Consumer Price Index (CPI) rose 1.6% year over year in September, the slowest pace since February 2021 and down from a 2.0% gain in August 2024. The main contributor to headline deceleration was lower year-over-year gasoline prices in September (-10.7%) compared with August (-5.1%). The all-items CPI, excluding gasoline, rose 2.2% in September, matching the increase in August for this measure.

Although the rate at which prices increase has slowed, price levels remain elevated. Compared with September 2021, the CPI rose 12.7% in September. Canadians continue to feel the impact of higher price levels for day-to-day basics such as rent (+21.0%) and food purchased from stores (+20.7%), which increased during that same 3-year period.

The CPI fell 0.4% in September after a 0.2% decline in August. Lower gasoline prices led to both the monthly and yearly movement in September. On a seasonally adjusted monthly basis, the CPI remained unchanged at 0.0%.

 

The central bank’s two core inflation measures remain sticky. Both measures were unchanged in September (see chart below). According to Bloomberg calculations, a three-month moving average of those measures fell to an annualized pace of 2.1% from 2.3% in August.

According to Bloomberg News, “After the release, traders in overnight swaps upped their bets that the Bank of Canada will opt for a larger rate cut at next week’s decision, putting the odds of a half-percentage-point reduction at about 75%. Previously, the odds were around 50%.” The Canadian dollar weakened further on the news relative to the greenback. The loonie has fallen for ten days, the longest streak since 2017. Canadian debt rallied across the yield curve, outperforming US Treasuries and pushing the two-year Canada benchmark yield to 3.03% and the 5-year bond yield to 2.92% by mid-day.

Tuesday’s data marks the first time since February 2021 that inflation is below the central bank’s 2% target and is the ninth straight month of headline rates running within its target range.

With inflationary pressures continuing to ebb and policymakers focusing more on preserving economic growth, the data give the central bank options to reduce rates quicker after cutting borrowing costs at 25 basis points at the past three meetings.

Bottom Line

While the September employment data were stronger than expected, Q3 GDP growth is slated to be roughly 1.8%, well below the Bank of Canada’s 2.8% forecast. Today’s inflation report is the last important data point before the Bank meets again on October 23. Late last month, BoC Governor Tiff Macklem warned that growth may be below policymakers’ previous expectations in Q3.

Excluding shelter costs, the consumer price index rose 0.4% from a year ago compared to 0.5% in August. Mortgage interest costs and rent remained the most significant contributors to the annual inflation rate change. However, rent prices increased at a slower pace in September, rising 8.2% versus 8.9% in August. Tuition fees, priced annually in September, also grew slower, increasing 1.8% compared with 2.5% last year.

Regionally, inflation is now at or below 2% in every province, with prices rising slower in September than in August in all ten provinces. The central bank will release new economic forecasts in the Monetary Policy Report next week. Macklem has said,  “decisive monetary policy action and the unblocking of supply chains” means “uncertainty about costs and inflation are much lower today than two years ago”.

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. 

BC mortgage market: What’s in store for the rest of 2024?

General Angela Calla 27 Sep

Falling interest rates have raised hopes of a market resurgence

Affordability struggles and eyewatering house prices may have weighed down homebuying activity in British Columbia over the past two years – but falling interest rates are set to spur a busier market for the remainder of this year and into 2025, with mortgage brokers already gearing up for that trend.

Residential sales across the Multiple Listings Service (MLS) in the province should jump by 4.4% by the end of the year, according to the British Columbia Real Estate Association (BCREA), and rise by over 10,000 units throughout 2025.

While the total inventory of available homes is now at its highest level since 2019 in the province thanks to tepid market activity during the first half of 2024, two summer rate cuts by the Bank of Canada – and the near certainty of more reductions before the end of this year – suggest better times are ahead for BC’s housing and mortgage markets.

Angela Calla (pictured, top left), a broker-owner based in Port Coquitlam, told Canadian Mortgage Professional that the Bank of Canada’s rate cuts (which marked the first time it had lowered rates for over four years) had boosted buyer sentiment noticeably. “We’ve seen renewed optimism,” she said, “and desire for education on different strategies. The increased engagement has been fantastic to increase Canadians’ financial literacy.”

How will further rate cuts impact the mortgage outlook?

Further cuts are on the horizon in the months ahead, with the Bank widely expected to lower its policy rate by a further 25 basis points when it meets next week (September 4).

That would bring its trendsetting interest rate to 4.25%, down from a 23-year high of 5% at the beginning of the summer, and it likely wouldn’t be the last cut the central bank makes in 2024.

Calla said a likely resurgence in market activity as rates fall means those buyers who can afford to get into the market now shouldn’t hold off. “If you’re considering a purchase, don’t wait until the rates go down further,” she said.

“More competition is coming in the marketplace. Buy and wait – don’t wait to buy, as prices will increase with a larger pool of buyers.”

For Vancouver-based broker Kyle Green (pictured, top right), the city is unlikely to see a big upswing in housing market activity before the end of the year. Still, that’s not to say buyers won’t face a potentially more challenging landscape, one that could see momentum swing back toward sellers.

That would buck a trend that’s emerged thanks to greater buyer choice and milder competition of late. “I believe Vancouver will be a relatively flat market,” Green told CMP, “potentially [seeing] some small declines in prices as the inventory has increased substantially.

“However, dropping rates may counterbalance this switch from a seller’s market to a buyer’s market which has only really been a recent phenomenon.”

Could variable rates become more appealing for buyers and homeowners?

The central bank’s recent pivot towards rate cuts doesn’t appear to have shifted sentiment in the mortgage market away from shorter-term variable options as the most popular choice among borrowers.

While rock-bottom variable rates during the COVID-19 pandemic saw many borrowers flock to those mortgage types, the Bank’s aggressive series of rate hikes throughout 2022 and 2023 meant they increasingly opted for two-to-three-year fixed options to keep their own rates steady.

Calla said that hasn’t changed markedly – not yet, at least. “Most are still gravitating towards fixed rates for a shorter term,” she said. “Variables are most attractive for very qualified borrowers with smaller-than-average mortgage amounts or those planning to sell in the next year.”

Green said his clients are also mostly inclined to go fixed, “but the tide is starting to turn right now.” The percentage of new business coming through the door and considering variable options, he said, is inching towards 50%.

Brokers should also be attuned, he said, to refinance potential for clients in the current market. “There seems to be a potential opportunity to refinance clients who took a three-year fixed in the second half of 2023,” he highlighted.

“Running the numbers, there seem to be surplus savings right now – [so] dig into your databases, brokers.”

 

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. 

September 2024 Newsletter

General Angela Calla 27 Sep

Welcome to the September issue of my monthly newsletter!
It is already September and I am excited to share my latest newsletter with you! This month, I have some details about the upcoming Fall market, along with expert tips for staging your home! Scroll down for all the details and have a great month.

2024 Fall Market Outlook

The initial Bank of Canada rate cuts this past summer did not spur housing activity as anticipated, but potentially more on the way will continue to affect the housing market outlook. New listing levels are expected to rise as sellers who may have held back enter the market with the hope that lower mortgage rates will attract additional buyers.

While the current Bank of Canada rate of 4.5% may still not be enough to make a dent in home affordability, it does provide a glimmer of hope for potential buyers as interest rates continue to fall.
Canadians across the country are anxiously awaiting additional rate cuts, promoting future home affordability. While consumer confidence is beginning to rise, mortgage affordability will need to be balanced with rising unemployment to reduce the number of households with strained budgets.
In addition, while home prices have cooled a bit, home prices in Canada remain among the highest in the world’s most advanced economies (Japan, France, Germany, Italy, and the UK). These still -high prices have resulted in many potential first-time home buyers to withdraw for now. Higher property taxes, higher qualifying stress-test rates, and the current wave of mortgage renewals will also factor into how successful the Fall market will be.
In 2023 alone, the country saw an influx of 46% of new Canadians, which also contributes to housing demands and pricing. As rates continue to drop, the hope is that prices will stabilize owing to increased supply as demand rises.
If you are looking to get into the housing market as a buyer or seller, or simply have questions so you can best prepare yourself for a future move, don’t hesitate to reach out to me!

Expert Tips for Staging Your Home

Even in a sellers’ market, there are some ways you can improve your chances of increasing the number of offers and selling your home for the best value.

Check out these expert tips for staging your home to help make the best first impression possible:

  1. Clean and Declutter: Clean, clean, and clean some more! While you might not be able to stage each room in your home, it is vital to ensure that each space is cleaned and decluttered. Especially ensure that counters, carpets, flooring, and appliances are spotless! This not only signals pride of ownership, but it helps display the potential of the spaces to buyers.
  2. Depersonalize: While you’re working through and cleaning your spaces, make sure to depersonalize along the way. Ideally, any family photos, kids’ drawings, etc, should be removed or replaced with more general photography to better appeal to potential buyers.
  3. Focus on Key Spaces: The primary areas in your home are your living room, kitchen, dining room, and master bedroom. If you are not able to get to each room, these are the ones you should focus on to ensure your home is represented as best as possible.
  4. Consider a Fresh Coat: Did you know? According to a RE/MAX Canada Renovation Investment Report, 36% of buyers prefer a fresh coat of paint! This can go a long way to making your home look new and revitalized.
  5. Boost Curb Appeal: While you’re staging your home, don’t forget about curb appeal! The exterior of your home is just as important as the interior – if not MORE important for first impressions. A good place to start would be renting a power washer to scrub down your driveway and exterior walls.

Economic Insights from Dr. Sherry Cooper

As the Bank of Canada cuts interest rates, housing activity has remained relatively weak. Existing home sales were well below historical averages in July, while new listings edged upward. Prices have plateaued, and residential mortgage originations are tepid.

Mortgage balances grew by 3% annually in Q2, the second slowest quarterly pace since 2000.

This portends a further dip in household debt-to-income ratios—welcome news, as elevated leverage drives household financial vulnerability. The central bank is widely expected to continue to cut the overnight policy rate at the remaining meetings this year and well into 2025. Monetary policy remains highly restrictive, with the policy rate at 4.5%, well above the 2.5% inflation rate.

We believe interest rates will continue to fall as the overnight rate heads for 2.75%. By later this year, housing activity is likely to pick up gradually.

In the meantime, Canadian homebuilding remains sturdy despite softness in the resale market and ongoing capacity pressures. Housing starts surged again in July. The data series is volatile, but the trend is strong at just under its recent all-time highs posted in 2021. The strength of residential starts has been dominated by multi-unit construction, while single-family starts have historically been very weak.

The home construction sector has suffered ongoing capacity pressures, including a shortage of construction workers, zoning restrictions and supply bottlenecks. These capacity pressures have delayed housing completions, bringing the number of dwellings under construction to fresh record highs.

Homebuilding has remained remarkably resilient, albeit at a much slower pace than the torrid population growth. The government plans to cool the growth in temporary immigration, but the Bank of Canada recently suggested that the slowdown is likely to be delayed and smaller than originally projected.

Meanwhile, Canadian labour markets are easing. Job vacancy rates have plunged, and unemployment has risen, especially for young workers and new immigrants.

Economic growth has slowed to about 1% this year and will pick up only moderately next year. Inflation is falling without a recession. To be sure, some sectors have slowed meaningfully, especially manufacturing. Canadian businesses are bracing for billions of dollars in losses if the country’s two national railways shut down this week.

More than 9,000 workers at Canadian National Railway Co. and Canadian Pacific Kansas City Ltd. could either be on strike or locked out if no labour agreement is reached by Thursday, disrupting the supply chain industries.

Housing markets will begin to recover as lower interest rates do their job this fall.

 

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. 

 

 

12345…10…Last »