The Canadian Housing Market Is Growing Again!
The Canadian housing market seems to be approaching the level of strength it once had before the mortgage stress test was implemented at the beginning of 2018, which prohibited a number of borrowers from qualifying for a mortgage. For a fifth straight month, the number of home sales in Canada has increased, as low interest rates helped stimulate the market by providing borrowers with greater financial power. Home sales were up by 3.5% from last month, and 12.6% since July of 2018. The Bank of Canada’s extremely low base interest rate, sitting at 1.75%, coupled with international tensions that are steering borrowing costs further downwards, will likely lead to an even greater boost for the housing market.
Nationally, the average price of a home increased by 0.6% in July from June, making it the largest month-to-month price gain since 2017, with price appreciation in booming Ontario markets and the Montreal region being the largest contributors to the average national price growth. The average transaction prices soared by a massive 3.9% from last year, which is a compelling indication of further price gains in the future. However, the optimistic data varies when looking more closely at housing markets from a local perspective. Ontario markets have seen price increases of over 10% in the past year, while a number of markets in Western Canada have seen declines. Moreover, the number of new listings in Canada is relatively stagnant at 0.4%, with listings in Ontario increasing amid declines in British Columbia.
Overall, sales have persistently risen in markets, such as Ontario’s, where the impact of the mortgage stress test on the housing market was quite weak, given healthy economic conditions and a consistent supply of relatively affordable homes. In contrast, housing markets show stagnant price growth or depreciation in regions facing economic slumps and negative consumer attitudes, which is only further amplified by the stress test restrictions.
Our team of experienced residential mortgage brokers at Clover Mortgage can help borrowers across Ontario become home-owners in the booming housing market. With home prices expected to rise and the cost of borrowing hitting extreme lows, now is the ideal time to invest in a home. If you are worried about the mortgage stress test, Clover Mortgage has access to over 50 lenders that offer unique products designed to fit your needs. Let a qualified and knowledgeable residential mortgage broker at Clover Mortgage find the perfect mortgage deal for you.
Call or text us today at 416-674-6222 or toll free at 1-800-673-2230, or email us at firstname.lastname@example.org to speak with a licenced and experienced mortgage broker and get your free no-obligation mortgage consultation.