March 9,2012. Yesterday, the Bank of Canada announced that they would not be adjusting their prime lending rate and that the prime lending rate would remain at 3%. This will have a direct impacton any variable rate mortgage(s), secured line(s) of credit, or personal line(s) of credit that you may have.
As expected, the Bank of Canada has left the overnight rate at 1% - which means variable rate mortgage holders can once again breathe easy. They can attribute their good fortune to slower-than-usual global economic growth.
Since January, things seem to be looking up on the global economic front as Europe is showing “tentative” signs of stabilization, global financial markets are improving and risk aversion is decreasing, the Bank says. South of the border, things are also looking up as the U.S. labour market begins to modestly improve, and China is making it through its past policy tightening and weak external demand.
As for the Canadian economy, things are looking up, too – albeit marginally.
The Bank expects the economy to grow faster than forecasted inJanuary due to temporary factors, and private demand is expected to be slightly stronger than projected due mainly to improved sentiment and highly-supportive financial conditions (think low interest rates). The Bank believes the biggest risk to the Canadian economy continues to be household debt ratios. It predicts Canadian households will continue to spend a lot compared to the GDP and, consequently, add to their debt burden.
The date of the Bank of Canada's next announcement is scheduled for April
17, 2012.
CONGRATULATIONS to Giles and Riel for winning our Uultimate Hockey Competition. Giles and his son Riel, who are both HUGE hockey fans, will be leaving for New York on Wednesday March 14th, will catch the Pittsburgh Penguins vs NY Rangers game at Madison Square Garden on March 15th and then fly home after three night in Times Square, NY on March 17th.
January 17 2012- The Bank of Canada announced today that it will not be changing its overnight rate. Therefore the Prime lending rate remains at 3.00%.
The outlook for the global economy has deteriorated as a result of the European debt crisis. The recession in Europe is now expected to be deeper and longer than originally thought. The Bank expects the US recovery to proceed at a modest pace owing to household deleveraging, fiscal consolidation and the spillovers from Europe.
The Bank feels that the pace of Canadian growth going forward will be modest largely due to the external environment. Prolonged uncertainty about the global economic and financial environment is likely to dampen the rate of growth of business investment. In contrast, very favourable financing conditions are expected to buttress consumer spending and housing activity.
With rates remaining the same, we are continuing to recommend that clients stay in their variable rate mortgages. The date of the Bank of Canada's next announcement is scheduled for March 8 2012.
Bob Alexander
Verico Maximum Mortgage Inc
Posted on January 16, 2012 - New CREB president forecasts upswing in real estate market.
Bob Jablonski will take over as president of the Calgary Real Estate Board on Wednesday when the organization officially releases its forecast for the 2012 housing market.Jablonski, who replaces outgoing president Sano Stante, comes in after Calgary’s resale MLS market showed some signs of rebounding in 2011.
Single-family home sales of 13,186 were 9.06 per cent higher than the previous year while condominium sales rose by 3.98 per cent to 5,382.
Jablonski, who has been a realtor since October 1987, was interviewed Friday by the Herald. Because of the upcoming forecast, he couldn’t offer specific predictions about the 2012 market.
Here is an edited version of the conversation:
Question: How would you describe the Calgary real estate market in 2011?
Answer: “It was becoming more of a stable market towards the end of the year. The pricing was more stable. A more relaxed market.”
Question: What do you mean by that?
Answer: “Well, there wasn’t a lot of up and down. There was some up and down to it but basically it flattened out at the end of the year.”
Question: What were the main factors influencing the market?
Answer: “I think the consumers started seeing more confidence in the economy overall and they got off the fence and started buying properties. Well-priced listings were selling. There’s always a market for well-priced listings. So people are moving on those.”
Question: Looking at some of the economic factors, what would be the key ones that would signify a change up or down in the real estate market?
Answer: “I think the affordability in Calgary has demonstrated itself. There’s a lot more product that people can afford to buy with the low interest rates. They felt more comfortable in their jobs and security and the indications are that there’s job stability, there’s in-migration coming into the city and the economy is getting better. So there’s no reason not to buy.”
Question: The Bank of Montreal has lowered its five-year fixed mortgage rate to a record low of 2.99 per cent. What impact will this have on the market?
Answer: “It’s going to help the market. Again, it’s showing signs of stability. Interest rates haven’t changed for a number of years and the prediction is they won’t change for awhile. So people are now more relaxed in the fact that the bottom is not falling out. The world hasn’t gone in the tank. We’re OK. And Calgary’s fine.”
Question: Where do you see the market in Calgary headed this year?
Answer: “My personal opinion is the market will be a good market. It will be an improvement over 2011 and it will be a gradual increase in both sales activity and in pricing.”
Question: Why do you foresee that?
Answer: “Again, because the consumer is feeling confidence in the market in Calgary. All the indications are that people have jobs to go to. Deerfoot’s packed every morning. People going to and from work. There’s lot of activity downtown in the construction. The Bow (tower) is one example. And the interest rates are low and the affordability is there.”
Keep this in mind if you are working with clients who don't quite have enough saved for the 5% down payment. I work with lenders who will provide your client with 5% cash back that they can use for their down payment. I have a lender right now that is offering 4.99% on a 5 year fixed rate. This is an amazing rate considering your client doesn`t have to wait to save the down payment and can take advantage of the great prices in the market today. Please let me know if you have any questions about this product.
Rachna Sharma
Mortgage Advisor
Tel: 403-619-5905
Fax: 403-770-8137
Email: mortgage@rachna.ca
http://www.jencormortgage.com/rachnasharma
Monday, January 31, 2011 - Looking to Buy or Sell Propery Outside of Calgary?
Monday, January 17, 2011 - Government of Canada Mortgage changes January 17 2011
Thursday, January 6, 2011 - CIR REALTY Proudly Rings in 2011 with Our New Vision Statement!
Thursday, January 6, 2011 - Calgary Herald Real Estate Article
Archives
Categories
