Canada’s Prime Minister Justin Trudeau makes a housing announcement with Toronto Mayor Olivia Chow and Canada’s Deputy Prime Minister and Minister of Finance Chrystia Freeland at a press event in Toronto, on Dec. 21.CARLOS OSORIO/Reuters
Here are The Globe and Mail’s top housing and real estate stories this week, with the lowest mortgage rates available in Canada today, commentary from our mortgage expert and one home worth a look.
Toronto reaches $471-million housing deal with Ottawa to build 53,000 units in the next decade
In an announcement in Toronto this week, Prime Minister Justin Trudeau said the $471-million deal will produce 12,000 homes in the first three years – the largest agreement yet through the federal Housing Accelerator Fund, writes Oliver Moore and Jeff Gray. One-quarter of the money will flow immediately, with the rest disbursed over three years. In return, the city has pledged measures that include speeding up home approvals, increasing the supply of rental homes and protecting existing rental stock. Critics have said the agreement is only one step toward addressing the city’s massive affordability problems.
Canada’s inflation rate holds surprisingly steady
The Consumer Price Index rose 3.1 per cent in November from a year earlier, matching October’s increase, Statistics Canada said Tuesday in a report — surprising Bay Street analysts who were expecting the inflation rate to lower down to 2.9 per cent. Mortgage interest costs are still rising by around 30 per cent, year over year, as homeowners face the impact of higher borrowing rates, writes Matt Lundy. Economists and investors continue to expect the Bank of Canada will start to lower its benchmark interest rate in the spring or summer of 2024. In anticipation of those moves, bond yields have tumbled since October, a welcome development for people renewing their mortgages.
This week’s lowest available mortgage rates
The economic vibe for 2024 is like a mixtape of bad songs: high inflation, elevated interest rates, wobbly home values, stricter regulations, rising unemployment and escalating loan defaults. But if rates tumble as expected, 2024 could have some surprise hits among the B-sides, writes Robert McLister in his weekly column. Some advice for next year: hold off loading the truck on bank stocks until the BoC takes a chainsaw to rates, look into investing in a mortgage investment corporations, and expect mortgage stocks to fall.
Opinion: B.C. drafted a bold housing blueprint. The rest of Canada should copy it
In the fight to alleviate the housing shortage, there’s been no shortage of good ideas. What has been too often absent is political will, writes The Globe’s Editorial Board. Policy ideas started to become political reality only this year. But it is B.C. Premier David Eby and his government that have gone the furthest, in the province where housing prices first spiralled out of control. Cities in B.C. have been instructed to quickly loosen their zoning rules. This includes, without special permissions, multiple homes on a residential lot and significant density near busy transit hubs. They’ve set a template for the rest of the country to follow.
Turn your home’s empty bedroom into $875 in monthly rent
We need practical measures that work right now, not over the years required to plan and build new condos, townhomes and houses, writes Rob Carrick. He’s written before about multigeneration housing, where different generations of a family live together. But another thought is homesharing, where people rent out unused bedrooms in their home and share amenities like the kitchen and yard.
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
