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Canada Housing Market and New Stress Test

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Published: 01 June 2021

june 1Canadian home sales took a turn in April 2021, declining by 12.5% (sa m/m) from the highest level on record in March 2021. Listings followed suit, falling by 5.4% (sa m/m). While both sales and listings decreased in April, the smaller decline in listings further eased the national-level sales-to-new listings to 75.2% from record high readings earlier this year (the highest being 91% in January). While this is a move in the right direction towards a better supply-demand balance, the ratio is still significantly higher than its long-term average of 54.5%. As a result of this persistent tightness in the housing market, the composite MLS Home Price Index (HPI) rose by 2.4% (sa m/m). This is a deceleration in price gains from paces observed over the last two months, owing in the most part to a slowing in prices for single-family homes and townhouses. Apartments, which had remained relatively close to pre-pandemic levels before accelerating earlier this year have maintained momentum in April.

Movements in the housing market this month continued to be broad-based rather than market-specific, as declines in sales were spread out across much of the country.

The Office of the Superintendent of Financial Institutions (OSFI) also announced that, effective June 1, the minimum qualifying rate for uninsured mortgages (i.e., residential mortgages with a down payment of 20 percent or more) will be the greater of the mortgage contract rate plus 2 percent or 5.25 percent.

To find out how the new stress test affects you, please feel free to contact me.

Quick facts about COVID-19 vaccines

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Published: 14 May 2021

covid19 vaccine(NC) You’ve probably heard from a family member or friend on social media some dubious “facts” about COVID-19 vaccines. But getting your information from people who aren’t health experts isn’t a wise idea, especially when it comes to health topics.

A trusted source like a healthcare provider or public health authority is a good place to get information. Here, the experts at Health Canada and the Public Health Agency of Canada share information everyone needs to know about the vaccines:

Read more: Quick facts about COVID-19 vaccines

Teranet–National Bank National Composite House Price Index

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Published: 11 May 2021

bank indexIn October the Teranet-National Bank National Composite House Price IndexTM began the fourth quarter with a dip of 0.1% from the month before. The final quarter of the year is typically slow for the index, and the monthly decline was in line with the average of the last 10 Octobers, in five of which the index retreated. In short, it is too soon to herald a downward trend on the national home resale market. Indeed, if seasonal pressure were removed (seasonal adjustment), October would have been the third consecutive month of an underlying uptrend.

Read more: Teranet–National Bank National Composite House Price Index

Bank of Canada maintains overnight rate target at 1 ¾ per cent

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Published: 11 May 2021

bank targetThe Bank of Canada today maintained its target for the overnight rate at 1 ¾ per cent. The Bank Rate is correspondingly 2 per cent and the deposit rate is 1 ½ per cent. Recent data suggest that the slowdown in the global economy has been more pronounced and widespread than the Bank had forecast in its January Monetary Policy Report (MPR). While the sources of moderation appear to be multiple, trade tensions and uncertainty are weighing heavily on confidence and economic activity. It is difficult to disentangle these confidence effects from other adverse factors, but it is clear that global economic prospects would be buoyed by the resolution of trade conflicts. 

Read more: Bank of Canada maintains overnight rate target at 1 ¾ per cent

Big jump in home prices in March

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Published: 01 May 2021

family gamesIn March the Teranet–National Bank National Composite House Price IndexTM was up 1.5% from the previous month, a sharp acceleration from the February increase of 0.5%. The advance was led by three of the 11 constituent markets: Halifax (3.3%), Hamilton (2.8%) and Toronto (1.9%). The rise for Vancouver matched the 1.5% of the composite index. Rises were more moderate for Winnipeg (1.1%), Ottawa-Gatineau (1.1%), Montreal (1.1%), Victoria (1.0%), Calgary (0.9%), Quebec City (0.9%) and Edmonton (0.3%). It was the first time since last November that all 11 markets of the composite index were up from the month before.

Read more: Big jump in home prices in March

Big jump in home prices in March

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Published: 23 April 2021

high pricesThe Teranet-National Bank HPI jumped 1.5% to a new high in March, its 17th straight monthly rise. Its recent vigour coincides with historically high numbers of home sales in most regions of Canada, coupled with limited supply. The monthly jump of the unsmoothed HPI was even bigger – 2.7%, the most of any month since July 2006, taking the unsmoothed index to a cumulative rise of 11.9% since last June (left chart).

Read more: Big jump in home prices in March

How to tell between a real CRA call and a scam

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Published: 01 April 2021

scam call(NC) Many of us have heard of scammers pretending to be from the Canada Revenue Agency. You may have even received a call or email yourself. But how do you know what you can trust?

Avoiding this common scam is easier when you know what the agency will and won’t do. The agency will never threaten you with immediate arrest or jail for a tax debt, and never uses text or instant messaging to communicate about taxes. It will never demand that you settle tax debt by buying gift cards or prepaid credit cards, or using cryptocurrency like Bitcoin, or offer to pay you a refund by e-transfer.

Read more: How to tell between a real CRA call and a scam

Home prices accelerate in February

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Published: 25 March 2021

home priceIn February the Teranet–National Bank National Composite House Price IndexTM was up 0.5% from the previous month, an acceleration from the January increase after three consecutive months of slowing. The advance was led by four of the 11 constituent markets: Halifax (2.3%), Hamilton (1.1%), Vancouver (0.8%) and Quebec City (0.7%). Rises of less than the countrywide average were reported for Montreal (0.5%), Victoria (0.4%), Calgary (0.4%) and Toronto (0.4%). The index for Winnipeg was flat on the month. Down from the month before were the indexes for Edmonton (−0.1%) and Ottawa-Gatineau (−0.5%). After three months, from September to November last fall, in which all 11 markets of the composite index were up from the month before, February was a third consecutive month in which one or more markets were down on the month.

Read more: Home prices accelerate in February

Bank of Canada will hold current level of policy rate until inflation objective is sustainably achieved, continues quantitative easing

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Published: 12 March 2021

levelThe Bank of Canada held its target for the overnight rate at the effective lower bound of ¼ percent, with the Bank Rate at ½ percent and the deposit rate at ¼ percent. The Bank is maintaining its extraordinary forward guidance, reinforced and supplemented by its quantitative easing (QE) program, which continues at its current pace of at least $4 billion per week.

The global economy is recovering from the economic effects of COVID-19, albeit with ongoing unevenness across regions and sectors. The US economic recovery appears to be gaining momentum as virus infections decline and fiscal support boosts incomes and consumption. New fiscal stimulus will increase US consumption and output growth further. Global yield curves have steepened, largely reflecting the improved US growth outlook, but global financial conditions remain highly accommodative. Oil and other commodity prices have risen. The Canadian dollar has been relatively stable against the US dollar, but has appreciated against most other currencies.

Read more: Bank of Canada will hold current level of policy rate until inflation objective is sustainably...

5 ideas for families to make the most of staying home this March Break

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Published: 05 February 2021

family games(NC) Due to current travel restrictions, families will be spending March Break at home. One way to keep your kids busy is by making personal finance a group activity.

Research shows that young people who discuss money matters with their parents have higher financial knowledge and skills, which leads to stronger financial well-being in the future.

Here are five ideas for simple things you can do with your kids to help them develop good money habits early:

Read more: 5 ideas for families to make the most of staying home this March Break

  1. Time for some Independent, Professional advice
  2. Record December caps record year for Canadian home sales
  3. Mortgage Deferral Agreements and Their Impact
  4. Bank of Canada will maintain current level of policy rate until inflation objective is achieved, continues its quantitative easing program

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