April (Spring) 2025, our annual realtor trip will be held in Nashville, Tennessee.
Qualifying is easy. Send $1,500,000 in total closed mortgage business to automatically qualify.
To date, we have 5 realtors who have already qualified.
B.O.C Policy Announcement
The Bank of Canada dropped rates by 50 bps for the first time since 2020. It seems unlikely that yesterday’s 50bp cut will be a one-off. The Bank seemed to leave the door open to another larger move although was non-committal, noting that “if the economy evolves broadly in line with our latest forecast, we expect to reduce the policy rate further.”
By speeding up the pace of interest rate cuts, they have signaled that the post pandemic era of high inflation is now over.
With one more announcement scheduled for this year, we can expect at least a 0.25% cut to the policy rate.
Prime is currently at 5.95%.
What’s Next?
Market-implied betting odds:
Bank of Canada meeting (December 11):
50bps cut: 24% chance
25bps cut: 76% chance
Federal Reserve meeting (on November 7):
25bps cut: 91% chance
No change: 9% chance
Payment Relief
For HELOC borrowers leveraging a line of credit, the 0.50% drop will save $41 in interest per $100,000 of borrowings.
For variable / adjustable rate mortgage holders, the 0.50% drop will drop payments $30/month per $100,000 of mortgage.
New variable rate mortgages are now sitting at approx. 5.25% for conventional lending and are a great option moving forward.
What Will Happen To Fixed Rates?
Fixed-rate borrowers may not get much rate reduction in the near term. We have already seen roughly 150 bps of drops in the last year. For further drops, we need to see continued signs of a weak economy.
Insured Cap Projections
While we still wait for the changes to the default insurance premiums to occur in December, forecasts are projecting a strong surge in activity. TD estimates that about 20% of homes in Canada are priced between $1.0 to $1.5 million. This opens up this price point to first time buyers with less than 20% down.
The main limiter remains income and not the down payment. Based on our office’s client profile, high income earners who would be traditionally forced into the condo sector can now move to areas such as Oakville, Etobicoke and Pockets of East/West Toronto. This enables them to purchase semi’s / town homes and other freehold units. The same can be said about the GVA.
Current Interest Rates
CONVENTIONAL
5 year fixed, 30 yr amortization – 4.40%
3 year fixed, 30 yr amortization – 4.50%
2 year fixed, 30 yr amortization – 6.00%
5 year variable, 30 yr amortization – Prime – 0.70% = 5.25%
5 year fixed, 25 yr amortization – 4.40%
3 year fixed, 25 yr amortization – 4.50%
2 year fixed, 25 yr amortization – 5.95%
5 year variable, 25 yr amortization – Prime – 0.80% = 5.15%
INSURED
5 year fixed, 25 yr amortization – 4.39%
4 year fixed, 25 yr amortization – 4.49%
3 year fixed, 25 yr amortization – 4.29%
5 year variable, 25 yr amortization – Prime – .95% = 5.00%
Fast Facts
6,800 – The number of new condo units in the last 2 years that were actively selling across the GTHA have been converted to rental, put on hold, cancelled, or placed under receivership.
20% – Jump in viewership for this year’s Major League Baseball playoffs compared to last year. Online traffic on MLB’s website is also up 34% compared to 2023.
$356.7 billion – Cost of replacing the road and water systems in Canada that are in poor or very poor condition. With more frequent floods, water infrastructure has become a major concern.
250 – Modular housing units that the Alberta government is building to house Jasper residents who were displaced by the wildfire. About 2,000 people lost their homes.
15 billion – The number of packable plastic air pillows that Amazon was going through every year. The company has now gotten rid of the plastic packaging material at all of its warehouses.
