bankofcanada

Your 5 Takeaways from the December 2023 Market Stats
Happy New Year! Welcome to the first episode of the New Year. In this episode of the Real Estate Podcast, i'm presenting you with your 5 Takeaways from the recent Dec 2023 Market Stats 

1. (GTA) home sales came in at less than 70,000 due to affordability concerns brought about by higher mortgage rates
2. Relief looks to be on the horizon with borrowing costs expected to trend lower by mid- 2024 (between April 10th - July 24th announcements). We have already witnessed a 30% decline in the 5-year Canada bond yield rate since its peak in early October. This has brought 5-year fixed mortgages down to almost 5% and has already encouraged some Buyers to re engage in the market. 
3. The Toronto Regional Real Estate Board's Macro Market Stats show that buyers who were active in the market benefitted from more choice throughout 2023, which allowed many of them to negotiate lower selling prices, alleviating some of the impact of higher borrowing costs.
4. The average selling price for all home types in 2023 was $1,126,604, Months of inventory across most regions is hovering around 3. MOI - Absorption Rate (obtained by dividing the total number of active listings by the total number of sold listings) can assist sellers to determine the optimal price for a property. The absorption rate is useful information for buyers as well because it indicates the extent to which a seller may be willing to lower their asking price or make other concessions. 
5. We have just welcomed more people to Canada on a per capita basis than we have since 1957. From July 1, 2022, to June 30, 2023 (2022/2023) Canada’s population grew by 1,158,705 people (2.9%) to an estimated 40,097,761 on July 1, 2023. This represents a significant increase from the previous year (1.8% in 2021/2022) and the highest growth rate for any 12-month period since 1957 (3.3%) when Canada welcomed many refugees from the Hungarian revolution and when the post-war baby boom was at its high.Simply put. we do not have enough housing. Lack of inventory and increasing demand as rates stabilize and come down will put upward pressure on pricing. The window of opportunity for buyers in particular is closing.

That’s it for today’s episode. The Macro Stats have been posted to Instagram and to my facebook & LinkedIn business channels. 

Ciao ciao

Just one more thing, When would you like to go over the MICRO stats of your neighbourhood?

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In This Episode Taheer & Tariq Discuss How Not To Get Sucked Into The Next Shinny Investment 

People the sky is not falling. Times are tougher, yes. But this "sky is falling" narrative makes for good headlines but rarely tells the whole story.

Welcome to another episode of the Real Estate Podcast with me, Nico James-Bock, a Broker and CondoWiz™ at Royal LePage Signature Realty in Toronto.

Looking forward I believe there are a few things we need to remember. We are lucky to live in a place that is one of the most sought after in the world. Over 1 million people came to our country last year and we anticipate another record this year. Everyone needs a home. While there is temporary uncertainty due to today’s rate environment, we know the need for housing has not changed. 

In the months and years to come there will be great opportunity in our real estate market as we benefit from being the fastest growing G7 country in the world. Everyone needs a home and that will result in values rising over time. Let’s be sure we see today’s market for what it is, a market of opportunity. 

The next BOC interest rate announcements:

Wed October 25th

Wed December 6th

Here are you key takeaways:

1. The higher interest rate environment will be here for a while. 2/3 of people own their own home. That is going to continue.  People will find a way onto home ownership.
2. The demand for housing is just going to continue. There is no way we are going to build the homes we need. What does that mean. Prices are going to continue to rise. We’ll be back to double digit home appreciation. Desirable properties that show well and are priced well are seeing bidding wars.  Almost 75% of neighbourhoods however, are in underbidding territory.
3. People are mobile. Particularly young buyers are going to be bouncing around. A network of trusted partners and advisors nationwide. 
4. Opportunities exist for savvy buyers and sellers who are prepared and guided by agents with local expertise and experience. The time to capitalize on these opportunities is now!

That’s it for today’s episode. I hope you are able to take from it those bits of factual information that are relevant to your situation.

I want to mention this podcast is featured in Feedspot Top 25 </

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Welcome to another episode of the Real Estate Podcast with me, Nico James-Bock. In this episode I recap the recent event that led up to the BoC's rate hold announcement on Sep 06th, including the TRREB August 2023 Market Stats and trends shaping our market. 

Here is my Market Recap for the week ended Sep 09th:  Nico's Quick Facts:

• Affordability in Toronto remains a very controversial issue, exacerbated by misguided government policies + the influx of people pouring into the GTA. 
• Co-ownership has emerged as a way to get into and stay in the market. By co-owning a property (with someone other than their spouse or significant other), homebuyers can not only divide the expense of homeownership among more people, but potentially access larger homes in more desirable locations that they may not have been able to afford on their own.
• The average selling price of all home types was at $1,082,496, remaining around last August's level, up 0.3%.
• Rents continue to go up Average condominium apartment rents continued to well outpace the rate of inflation in the second quarter of 2023. Despite seeing an increase in the number of units listed for rent, competition between renters remained very strong. This competition underpinned higher average rents. The average one-bedroom condo apartment rent was $2,532 in Q2 2023 – up 11.6 per cent compared to Q2 2022. Similarly, the average two-bedroom rent was up by 9.2 per cent over the same period to $3,264. The rent increase guideline in Ontario for 2023 is at that maximum of 2.5 per cent for rent-controlled units. Rent control only applies to units first occupied by anyone, not just the current renter, before Nov. 15, 2018.
• Inventory Levels remain low, not enough to satisfy existing demand, let alone the many hundreds of thousands of newcomers during into the city each year
• Tracking real estate trends is done weekly to be able to provide you with current data. And it has to be done on a micro (neighbourhood) level. The numbers are tremendously helpful. 
• Mortgage rate changes by the Bank of Canada will heavily influence the market, possibly creating opportunities. The Sep 06 rate hold announcement was pivotal and is already having an impact on the market, changing it, moulding it. there was little pressure for the BoC to keep raising rates. My expectation is that this period of "weak economic growth" is set to continue over the rest of this year and into early 2024. Same thing happened: March 8 and April 12th rate holds. Prices trended upwards, buyers were bolstered by the decision and returned to the market. Bank will raise rates if it thinks its necessary to get the inflation rate down to its target 2%
   
   Next: October 25th Interest rate announcement and Monetary Policy Report
   Dec 6th Final interest rate announcement of 2023

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In this episode of The Real Estate Podcast, I provide you with 5 take-aways from the recently released July 2023 TRREB Market Stats.

5 Take-aways:

1. Real Estate is a long-term investment. Hang on!
2. Housing Inventory Fluctuates but we are in a severe need of more housing stock
3. Slight decrease in Buyer Activity 
4. Misalignment in Public Policy as it relates to housing
5. Double Digit Rent Growth in the 2nd Quarter

•We have no control over interest rates. 

•As these higher interest rates continue to work their way through the economy, the Bank expects economic growth to slow, averaging around 1% through the second half of this year and the first half of next year.

•The next scheduled date for announcing the overnight rate target is September 6, 2023. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the Monetary Policy Report on October 25, 2023.

•I mentioned in last month’s overview the fact that we can’t and shouldn’t ignore the impact new immigrants coming into Canada. With Canada’s population growing at a record pace, the medium-term outlook for the GTA housing market remains for the most part, positive. In the short-term, some further caution on the part of buyers can be expected as rates edge up or hover around current levels, although as we move into the 2nd half of 2023 and towards the first quarter of 2024, increased demand for housing coupled with low supply levels should limit any further softening in prices, and in fact we should see a return to an accelerated rate of price appreciation. 

Ciao ciao

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In today's episode of The Real Estate Podcast, I talk about the 3 key indicators everyone should know about if they are going to understand what's happening in the residential market right now:

3 Key Indicators:

1. Supply Indicators
2. Demand Indicators
3. Price Indicators

Nico's Final Comments:

•The fact that GTA housing prices returned to positive year-over-year growth in June should provide a signal to the market that the correction everyone is talking about is likely over. This should bolster confidence in both buyers and sellers. 

•What about interest rates? Well, any further interest rate increases by the BoC are expected to be marginal at this point. Rate holds and possible small rate increases are predicted for the next 2 quarters. While the economy is running a bit stronger than anticipated by the Bank of Canada, inflation is clearly slowing, decelerating from 4.4% in April to a two-year low of 3.4% in May. We’ll see further deceleration once we have final figures for June and July.

•As interest rates have risen 325 basis points over the past year (to June) and a total of 450 basis points since the low during COVID, rates are still at a restrictive level for the economy, which should cause inflation to fall into the Bank of Canada target range of under 3%. This should eventually lead to decreases in interest rates, first for fixed-rate mortgages in the final quarter, and then variable rate mortgages likely sometime in early to mid-2024. 

•We can’t and shouldn’t ignore the impact new immigrants coming into Canada. With Canada’s population growing at a record pace, the medium-term outlook for the GTA housing market remains for the most part, positive. In the short-term, some further caution on the part of buyers can be expected as rates edge up (benefiting the rental market), although low supply levels should limit any potential softening in prices. 

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My special guest on today's episode of the Real Estate Podcast with Nico James-Bock is award-winning mortgage broker Sean Humphries from Dominion Lending Centres. Wer discuss the new rate announcement and what it means for consumers.

The Bank of Canada has raised its policy interest rate again, making the cost of borrowing more expensive.

The 25 basis points hike brings the Bank’s overnight rate to 5 per cent, the highest it’s been since 2001.

In its Monetary Policy Report, the Bank of Canada says the rate increase was necessary to help slow economic growth and reduce core inflation. Three-month rates of core inflation have been higher than the Bank’s expectation hovering around 3.5 per cent to 4 per cent since September 2022.

Sean;s Takeaways:

• The Bank's interest rate hike will likely cool the market going forward
• Hardest hit will be the seasonal cottage market
• Many sellers and buyers expect there to be a reduction in price, but price is often very sticky in these situations
• I expect that many people with a rate hold will actively be looking to use it before it expires
• Buyers will return to the market when we get more economic data that shows that the economy is cooling
• Immigration continues to fuel both the job market and the housing market
• If we didn't have the immigration numbers that we have, the market would have cooled a lot faster
• Demand continues to outstrip supply
•  No amount of interest rate hikes will take all of the wind out of the sails of the housing market.  
• Fixed interest rates have increased substantially, and there is room for them to fall well before the Bank of Canada decides to reduce the policy rate.

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Canada's inflation rate reversed its brief cooling trend last month and moved higher, to a 4.4 per cent annual rate.

Economists had been expecting new data released by Statistics Canada to show the cost of living had eased from March's 4.3 per cent pace to something around 4/4.1 per cent. 

Instead, it moved higher again, as the cost of things like gasoline, rent and mortgages increased during the month.

This increase in the inflation rate will not come as welcome news to the BoC, which has been raising its interest rate aggressively since March 2022 wrestle down the inflation rate to a more palatable 2 or 3 percent.

Welcome to another episode of The Real Estate Podcast with me, Nico James-Bock, a Broker with Royal LePage Signature Realty in Downtown Toronto. Pay close attention to my 10 takeaways.

In summary, based on the information we have, combined with the historical data we study, the adage, “When’s the best time to buy real estate...yesterday”, still rings true. This is no blip. We will continue to see this inflation dance as the powers that be try and wrestle it downwards. From my personal and professional experience, the sooner you enter the market with a long-term view, the better your results. First-time Buyers and most Renters*: Get off the fence! Take advantage of opportunities in the assignment and pre-construction markets now! 

As for existing homeowners and investors, patience continues to be profitable, and will likely do so for many years to come.

Caio ciao

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In This Episode Taheer & Tariq Discuss If The American Dollar Is Finally Dead.

We are only a few weeks away from the end of the first quarter of the new year!

I have an interesting update on the housing market as home prices have dropped over last year's record peak in February 2022. The drop in prices is assisting in mitigating the cost of higher mortgage rates and borrowing costs.   The average sale price in February was approximately $1,095,617, down 18% compared to February 2022 but it's up almost 5% compared to the same time in 2021.  The housing correction that started in March 2022 continues. But we are seeing signs of a return to normal housing appreciation.

Months of inventory levels dropped slightly and are now hovering around two months.  This inventory represents all home types, should the Toronto Regional Real Estate Board not add another listing, the GTA would be sold out of its residential real estate inventory in just two months.  

There has been an increased demand for real estate that is beginning to run up against a constrained supply of listings which is leading to increased competition among buyers. We feel this will eventually lead to renewed price growth in many areas of the market.  

The Bank of Canada today held its target for the overnight rate at 4½%, with the Bank Rate at 4¾% and the deposit rate at 4½%. The Bank is also continuing its policy of quantitative tightening. No increase in the rate this time around. 

The residential new construction market has also begun to pick up with the Bank of Canada making their intentions clear to hold interest rates at their current levels, more buyers and investors are engaging in this area of the market.  With a limited inventory of available resale homes, first-time buyers, up-sizers and down-sizers have taken a keen interest in new construction opportunities.  

The charts and graphs are attached to the blog post. You can always view them and reach me through my various channels: 

Ciao ciao 

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In This Ep. Taheer & Tariq Discuss If People Are Really Feeling The Pinch Of Higher Prices.

Welcome to a new episode of The Real Estate Podcast with Nico James-Bock, a Broker with Royal LePage Signature Realty in Downtown Toronto.  My guest on this special episode is award-winning mortgage broker Sean Humphries from Dominion Lending Centres who offers a quick primer and a hot take or two on what’s happening this week in the world of mortgages. We’re hoping the January 25th (variable) rate hike is the last rate hike for a while, and at the same time, we’re watching fixed rates fall.

This episode is available on YouTube where you can view the charts and slides referenced in this audio recording:  https://youtu.be/Bs-hTMrSaSM

As of Wednesday, January 25th, the prime rate is now 6.70%.  The Bank is now satisfied with their current rate policy, and will watch it work its way through the economy before making any further changes.  

"With persistent excess demand putting continued upward pressure on many prices, Governing Council decided to increase the policy interest rate by a further 25 basis points. The Bank’s ongoing program of quantitative tightening is complementing the restrictive stance of the policy rate. If economic developments evolve broadly in line with the MPR outlook, Governing Council expects to hold the policy rate at its current level while it assesses the impact of the cumulative interest rate increases. Governing Council is prepared to increase the policy rate further if needed to return inflation to the 2% target, and remains resolute in its commitment to restoring price stability for Canadians. "

For purchases over $1M and all refinances, five-year variable rate discounts are unchanged and currently sit at about 6.30%.  The five-year fixed rates are falling and currently sit at approximately 4.99%.  For every $100K of mortgage that’s about $533/month for fixed rates and $619/month for variables calculated using a 30-year amortization. 

For purchases under $1M with less than 20% down, the five-year variable rate discount is holding steady at Prime minus .90%, but the overall rate has gone up because of the prime rate increase (5.80%) and five-year fixed rates are at 4.59%, with more lenders lowering rates this week.  For every $100K of mortgage that’s about $560/month for fixed rates and $630/month for variables, calculated using a 25-year amortization.  

#mortgagerates

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In This Episode Taheer & Tariq Discuss How The ENTIRE Market is Going To S%$!

In This Episode Taheer And Tariq Discuss A Possible Fed Pivot On The Interest Rates 

Guest: Philip Cross, senior fellow at the Macdonald-Laurier Institute

Many of the country’s top economists are predicting that a recession is coming, and it will hit harder and last longer than previously forecast. The Canadian housing market has been pegged as being one of the most distorted in the world and, while interest rates are rising in order to combat inflation, that has often led to a recession. What would a recession look like now and is it inevitable? Philip Cross, a senior fellow at the Macdonald-Laurier Institute and former chief economic analyst at Statistics Canada, joins “This Matters” to break down the indicators for us

This episode was produced by Alexis Green, Paulo Marques and Raju Mudhar.

Audio source: Bloomberg

Guest: Heather Scoffield, economics columnist

The latest inflation numbers are in and while it looks to be slowing slightly due to lower gas prices, all other signs show that Canadians are paying higher prices for all kinds of consumer goods. With the Bank of Canada raising interest rates, property values continue to fall and many worry that it will trigger a recession. Heather Scoffield, The Star’s economics columnist and Ottawa bureau chief, explains the latest numbers and why more creative solutions are needed.

This episode was produced by Brian Bradley, Matthew Hearn and Raju Mudhar.

In This Episode Taheer & Tariq Give You Their Predictions On The Finacial World, For The Rest Of 2022.

The month of July seemed to fly by like a blur. Much has happened in our busy market since we celebrated Canada Day, with the most notable being a 1% raise in interest rates by the BoC (you can listen to my previous podcast for a detailed breakdown of the rate increases and announcements). Interest rates are the hot topic right now as the BoC tackles historically high inflation. We ultimately knew this would happen; however, the pace of rate increases is what has caused temporary uncertainty and the resulting temporary shift in Buyer sentiment. In this episode of The Real Estate Podcast with me, Nico James-Bock, a broker at Royal LePage Signature Realty in Downtown Toronto, I’m going to share a few more insights into this new rate-hike environment and what it means for the resale, condo and rental markets in the GTA.

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What are some of your challenges this summer heading into the fall? Are you a first-time buyer trying to decide between renting and buying? Are you an investor waiting to see where interest rates are heading? Perhaps you’re a homeowner contemplating a move? In today’s episode of the Real Estate Podcast with me, Nico James Bock, Broker at ROYAL LEPAGE Signature in downtown Toronto, I’m going to address these and other scenarios in an attempt to proved some clarity heading into the fall.

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In this episode, I’m going to update you on the current state of the residential real estate market, preview the Bank of Canada’s rate hike announcement, and explain where the market is heading as we approach the 2nd half of the year.

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