Canadian Real Estate Prices Expected To Decline 3.3% in 2023 – Why This Could Be Good News for Buyers

It is no secret that the Canadian real estate market has been shifting over the last year. Home prices have tumbled, and sales activity has fallen. The Bank of Canada (BoC) has been raising interest rates since March 2022 to return the annual inflation rate to its two-per-cent target rate. In the process, this tightening campaign has increased mortgage rates and cooled off Canada’s red-hot housing sector.

But with the central bank still expected to pull the trigger on rate hikes for the next few months to ensure inflation has been defeated, what does this mean for the Canadian real estate market, especially with the typically busy spring buying season?

It could be a terrific opportunity for homebuyers, especially with…

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Bank of Canada Raises Target for Overnight Lending Rate

Bank of Canada Raises Target for Overnight Lending Rate Again, Changes Language on Future Rate Hikes

The Bank of Canada hiked its target for the overnight lending rate by 50 basis points to 4.25% while continuing its policy of quantitative tightening but stated that looking ahead it would need to consider whether the policy rate should rise further—a much more neutral stance than previous announcements.

After the announcement, financial markets were pricing in the potential for one more interest rate hike by the third quarter of 2023.

The Bank noted economic growth was stronger than expected in the third quarter of 2022 and continued to operate in excess demand. The Bank expects growth to stall through the end of the year and into the…

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Canadian Home Sales See Surprising Rise?

On Tuesday, November 15, the Canadian Real Estate Association (CREA) released its national housing statistics for the month of October. Below, CREA’s Senior Economist Shaun Cathcart provides an update on the current state of housing markets in Canada and explains what the data means for members:

In a surprise to many, home sales recorded over Canadian MLS® Systems edged up 1.3% between September and October 2022.

To close observers, this should not come as a surprise given that month-to-month sales declines have been becoming increasingly smaller since May. For some, the change from negative to positive results is a big deal, if only psychologically.

A 1.3% increase may not seem like much since our natural inclination is to compare it to…

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A Spotlight on Newfoundland Real Estate

Since the beginning of the coronavirus pandemic, the Newfoundland and Labrador real estate market has seen the best of times and the most modest of times. In other words, the Atlantic Canada housing market has enjoyed a pandemic boom, but prices have not mirrored what was taking place in British Columbia or Ontario.

Despite climbing interest rates that have ostensibly impacted many major urban centres, small towns and rural communities across the country, Newfoundland and Labrador have held steady. The province and its municipalities have not fallen off a cliff. Instead, despite waning demand, prices have remained intact and affordable.

So, what occurred in the eastern province’s real estate market? Let’s explore the…

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Locking In a Variable Rate Mortgage

When mortgage interest rates were on a downward trend in the early days of the coronavirus pandemic, a variable mortgage rate made sense. With no signs of tightening on the horizon, the housing market boomed at extraordinary levels never seen before.

Now that interest rates are rising as the central bank attempts to rein in out-of-control price inflation, the discussion is how high mortgage rates will go. It is a crucial conversation, since rising rates will increase your monthly mortgage payments. While it’s challenging to forecast just how high mortgage rates will climb, Canada Mortgage and Housing Corporation (CMHC) thinks they will start to stabilize in 2024, which is when some market analysts expect the Canadian real estate market to…

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3.5 Million More Homes Needed by 2030 to Tackle Affordability Crisis

Is Canada’s housing affordability crisis as bad as it was a year ago? No.

Is Canada’s housing affordability crisis still ongoing? Yes.

The talk of affordability has dissipated in recent months as prices continue slipping from their peak earlier this year. Many financial institutions are anticipating declining prices heading into the new year, with projections as deep as 25 per cent.

While this is a considerable drop in home valuations, prices are expected to remain above the pre-pandemic levels. This is especially true in many major urban centres, such as Toronto and Vancouver.

RBC published its latest housing affordability report that confirmed the situation has not been this bad since the early 1990s. The…

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Can You Afford a Cottage?

You want to buy a cottage, but can you afford a cottage? At the height of the coronavirus pandemic, cottages became hot commodities across the country and prices skyrocketed. Traditionally, these properties were considered recreational by nature, visited on weekends during the summer or for seasonal maintenance by winter.

But why can’t you live in your waterfront cottage all year long? This was the question many households had during the pandemic. When they had their answer from employers by way of remote work, they packed up their things and relocated to the likes of Muskoka, the Kawarthas and Haliburton, to buy one of the many beautiful cabins, chalets and cottages in the region.

Now that the Canadian economy is reopening, offices are opening…

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10 Most Affordable Places to Buy in Canada (2022)

Despite recent cooling in Canadian real estate markets due to rising interest rates, the fact remains that housing prices are still hovering at a high, relatively speaking. Add to this the record-high inflation rate, which reached 8.1 per cent in June, up from 7.7 per cent in May, and there’s no arguing that housing affordability in Canada has taken a big hit. While this is particularly true in major markets such as Toronto and Vancouver, as well as their suburbs, there’s still affordable housing to be found in Canada – and Canadians are willing to relocate to find it.

RE/MAX Canada’s 2022 Housing Affordability Report analyzed 24 major housing markets across the country (for Quebec market insights, please visit RE/MAX…

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Bank of Canada Interest Rate Announcement: Supersized Rate Hike of 100 Basis Points on July 13

Bank of Canada Interest Rate Announcement: Supersized Rate Hike of 100 Basis Points on July 13

The Bank of Canada was widely expected to make an increase in this morning’s interest rate announcement, but the central bank surprised everyone with a supersized hike of 100 basis points, bringing its target for the overnight rate up to 2.5 per cent. This is the Bank’s biggest move since 1998, and the fourth in a series of increases expected for 2022 as the Bank tries to tamp down the soaring inflation rate. Inflation is expected to hover around eight per cent for the next few months – well above the Bank’s two-per-cent target.

1. What is the Bank of Canada’s current policy interest rate?
2. When does the Bank of Canada announce its overnight rate?
…

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How Will Higher Interest Rates Affect Me?

Canadians have enjoyed low interest rates for the last decade, but even more so since the onset of the global pandemic, when the Bank of Canada responded with a trio of rate cuts, bringing us to 0.25%. But 2022 has already seen three interest rate hikes in response to soaring inflation rates, which reached a 39-year high in May, at 7.7 per cent. With a fourth increase in the Bank’s interest rate, you may be wondering: How will higher interest rates affect me?

What does an interest rate hike mean if you’re planning to buy a home, if you already have a mortgage, or are carrying any other debt? Let’s take a step back to better understand what causes movement in interest rates and how a higher rate might impact you.

What Causes Interest Rates to…

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