Good News for Canadian Borrowers, and 30-Year Amortizations for First-time Homebuyers

This week’s top real estate stories.

By  Jared Lindzon | 2 minute read

Every Friday, Wahi brings you the most important real estate stories from the past week.

“CANT” Sell Homes in This Market 

A group of competitors with nothing left to lose are banning together to pitch a solution to the country’s housing death spiral that’s so crazy it just might work. The new housing market “Suicide Squad,” which includes 18 developers who collectively plan to build 100,000 housing units in the next 10 years, wrote letters to all three levels of government asking for steep tax breaks that they promise to pass on to buyers dollar-for-dollar. The newly formed Coalition Against New-Home Taxes, or “CANT,” blames a steep rise in fees for the lack of housing supply — and affordability — in Canada.

Why American Stock Losses Could Be Canadian Homeowners’ Gain

The U.S. economy is looking a little shaky right now, which is good news for Canadian borrowers, and not just because of some cross-border schadenfreude. Last week the American Bureau of Labor Statistics announced an unexpected jump in unemployment, which was followed by a rough few days on the stock market, but there is a silver lining for Canadians. The economic volatility makes it more likely the American Fed will cut interest rates sooner, quelling fears that Canada is moving too quickly compared to its neighbours, potentially giving the Bank of Canada the ability to cut its rates faster and more aggressively.

Yet Another Program for First-Time Homebuyers 

The federal government has offered several programs aimed at helping first-time homebuyers, some of which have been more successful than others. On the more successful side is the First Home Savings Account; on the “others” side, the now defunct First-Time Home Buyer Incentive. As of August 1, the Feds now allow 30-year amortizations for first-time buyers of new homes with insured mortgages, up from the current 25 years. Given that properties priced over $1 million won’t qualify, critics aren’t so sure the latest program will have an impact in the places where relief is needed most. 

A Tale of Two Canadian Cities

It was the worst of times; it was the somehow even worse of times for Canada’s two most expensive housing markets. After a concerning June report — which showed a 16.4% decrease in annual sales and a 12.3% increase in new listings — Toronto’s housing market seems to have made a modest recovery, with the Toronto Regional Real Estate Board reporting a 3.3% increase in annual sales in July. The West Coast, meanwhile, is starting to mimic last month’s concerns in the East, with Greater Vancouver Realtors reporting a 5% drop in sales and a 39.1% spike in listings since last year.

Fire Sale in Toronto Really More of an Ember  

If you were shopping for just about anything other than a home a sub-1% discount would be laughable. In Toronto’s housing market, it might be the best you could hope for. According to the Toronto Regional Real Estate Board’s latest report average selling prices dropped from $1.116 million to $1.106 million between this July and last July, despite lower interest rates and a surge in inventory. With prices holding steady and interest rates likely on their way down some, like Royal LePage, expect prices to skyrocket in the coming months, so enjoy that discount while you can.

Share this article on social.