Have you ever walked through a home and thought,

“I love everything about it… except the kitchen.”

Or maybe the bathrooms are dated, the flooring needs replacing, or it needs a new roof.

Most buyers assume they have two choices:

• Buy the home and somehow come up with thousands of dollars after possession to renovate.
• Walk away and keep searching.

But there’s actually a third option that many Canadians don’t know about.

What is a Purchase Plus Improvements Mortgage?

A Purchase Plus Improvements mortgage allows you to finance eligible renovations into your mortgage when you purchase a home.

While this program is most commonly used with insured mortgages (less than 20% down), many lenders also offer Purchase Plus Improvements options for conventional mortgages with 20% or more down payment.

Instead of paying for renovations entirely out of pocket, your lender can advance the renovation funds after the work has been completed and verified, allowing you to spread the cost over the life of your mortgage.

For many buyers, this can make purchasing a home much more affordable.

Who is it for?

This program can be a great option for:

• First-time home buyers
• Buyers with less than 20% down payment
• Buyers putting 20% or more down
• Buyers wanting cosmetic updates
• Buyers purchasing homes that need repairs before moving in
• Buyers looking to increase the value of their property

What types of renovations can be included?

Every lender has slightly different guidelines, but common improvements include:

• New kitchens
• Bathroom renovations
• Flooring
• Windows and doors
• Roofing
• Heating systems
• Electrical upgrades
• Plumbing
• Septic systems
• Cosmetic renovations
• Energy-efficient upgrades

How does it work?

The process is straightforward, but planning ahead is essential.

1. You find a home and have an accepted offer.
2. You obtain written quotes from licensed contractors.
3. The contractor quotes are submitted along with your accepted offer and mortgage application before the lender issues the mortgage commitment.
4. The lender reviews and approves both the mortgage and the proposed improvements.
5. Your mortgage closes.
6. The renovations are completed.
7. Once the work has been verified, the lender releases the approved renovation funds.

In many cases, homeowners pay the contractor and are reimbursed once the work has been completed.

However, some contractors are willing to accept a small deposit upfront and receive the balance directly from the lawyer once the renovations have been completed and the lender has authorized the release of funds. This arrangement is made directly between you and your contractor and should be discussed before the work begins.

Why buyers love this program

Instead of competing for the perfectly renovated home, which often commands a premium price, you can purchase a home with great potential and customize it to suit your tastes.

This can allow you to:

• Increase the property’s value
• Personalize your home
• Finance eligible improvements through your mortgage
• Preserve more of your savings after possession

A real-world example

Let’s say you purchase a home for $700,000.

The kitchen is outdated and the flooring needs replacing. Your contractor provides quotes totaling $35,000.

Those quotes are submitted with your accepted offer and mortgage application. The lender approves the renovation budget as part of your financing.

After your purchase closes and the renovations are completed, the lender releases the approved funds according to its guidelines.

Instead of needing an extra $35,000 in cash after moving in, you’ve been able to include the renovation costs as part of your overall financing strategy.

Is it right for everyone?

Not necessarily.

Purchase Plus Improvements mortgages have lender and insurer guidelines that must be followed, including:

• Approved contractor quotes submitted before final mortgage approval
• Eligible renovations
• Maximum improvement limits
• Required documentation
• Completion deadlines for the renovations

Because every lender has different requirements, it’s important to discuss this option before removing subjects on your purchase.

Final Thoughts

Some of the best opportunities on the market are homes that need a little work.

If you’ve been scrolling past listings because they’re “not quite right,” a Purchase Plus Improvements mortgage could open up far more options than you realized.

The key is planning ahead. The renovation quotes and financing strategy need to be in place early in the mortgage process, so having the right advice from the beginning can make all the difference.

If you’re considering buying a home that needs updating, let’s talk before you write your offer. There may be a financing solution that helps you purchase the home you want while creating the home you’ll love.

Our door is always open.

The Bank of Canada made its interest rate announcement today.

Within minutes, the internet was flooded with opinions.

Some people are convinced rates are coming down.

Others are certain they’re headed back up.

Everyone seems to have a prediction.

Here’s the thing.

Very few of those predictions will help you decide whether you should buy a home.

That’s the conversation worth having.

 

So… What Happened Today?

The Bank of Canada decided to hold its overnight lending rate at 2.25%.

If you’re wondering whether that’s good news or bad news, the answer is…

It depends.

And that’s probably not the answer you were hoping for.

 

The Biggest Mistake I See

I’ve been in the mortgage industry for more than 20 years.

One thing hasn’t changed.

People spend an incredible amount of time trying to predict the market.

They wait for lower rates.

They wait for lower home prices.

They wait for “the perfect time.”

The problem?

The perfect time has a funny way of never showing up.

 

Let Me Ask You a Question

If the Bank of Canada had lowered rates by a quarter of a percent today…

Would you suddenly be ready to buy a home?

If the answer is no, then today’s announcement wasn’t really what was holding you back.

Because buying a home has never been about one interest rate announcement.

It’s about your financial picture.

Your goals.

Your timeline.

Your comfort level.

Those things matter far more than trying to predict the next Bank of Canada decision.

 

Headlines Don’t Buy Homes

I know that’s not as exciting as a bold prediction.

But it’s true.

Every rate announcement creates another round of headlines.

“Rates are about to fall.”

“Now is the time to buy.”

“Wait another six months.”

The reality?

Nobody knows exactly what the future holds.

Not me.

Not the media.

Not the person arguing in the Facebook comments.

Anyone who tells you they know exactly where rates are going is making an educated guess.

Some guesses turn out to be right.

Many don’t.

 

Here’s What You Can Control

You can’t control inflation.

You can’t control the Bank of Canada.

You can’t control global events.

But you can control your preparation.

You can improve your credit.

You can reduce debt.

You can increase your savings.

You can understand what you qualify for before you start shopping.

You can build a plan.

Those are the things that move you closer to homeownership.

 

The Difference Between Hope and a Plan

Over the years, I’ve watched people make two very different decisions.

Some waited because they hoped something would change.

Others made a plan.

Sometimes they bought right away.

Sometimes they waited.

But when they did wait, it was because it fit their strategy, not because they were waiting for a headline to tell them what to do.

That’s a very different mindset.

Hope is important.

But hope is not a strategy.

 

So What Does Today’s Announcement Mean?

For some people…

Not much.

For others…

It might be the nudge they needed to start asking questions.

The most important question isn’t:

“What did the Bank of Canada do today?”

It’s this:

 

“What should I do based on my own financial situation?”

That’s the conversation that actually matters.

If you’re wondering whether you’re ready to buy, refinance, renew, or simply want to understand your options, let’s talk.

No pressure.

No predictions.

Just a plan that’s built around you.

 

“It’s once in a lifetime.”

I’ve heard that phrase a lot lately.

And to be fair… for many people, the FIFA World Cup in Canada really is a once-in-a-lifetime event.

The atmosphere is electric.

The memories are unforgettable.

The experience is incredible.

So this isn’t a blog telling you not to go.

It’s a blog asking a different question.

What are we giving up without realizing it?

We’re Living in a Time of Contradictions

Every day I hear people say:

“Homes are impossible to afford.”

“The cost of living is out of control.”

“I’ll never be able to buy a home.”

Then, in the same week, some of those same people are financing vacations, carrying credit card balances at nearly 20% interest, buying $500 concert tickets, or spending thousands on FIFA.

Again…

There’s nothing wrong with enjoying life.

The issue isn’t the purchase.

It’s whether the purchase is aligned with your long-term goals.

Small Decisions Become Big Numbers

Let’s put things into perspective.

A family of four attending a World Cup match could easily spend:

• Tickets
• Flights or fuel
• Hotel
• Food
• Merchandise

It’s not difficult to spend $5,000–$10,000 over a weekend.

That’s a meaningful amount of money.

Could it have been used differently?

Maybe.

Could it become part of a down payment?

Possibly.

Could it pay off a high-interest credit card?

Absolutely.

Does that mean you shouldn’t spend it?

Not necessarily.

But it’s worth asking yourself whether you’re making the decision intentionally—or emotionally.

The Real Cost Isn’t the Ticket

The real cost isn’t the FIFA ticket.

It’s the interest that comes afterward.

It’s the credit card balance that quietly grows month after month.

It’s convincing yourself that homeownership isn’t possible because everything is expensive, while unknowingly making choices that move the goalposts farther away.

Those decisions rarely happen all at once.

They happen one swipe at a time.

What If Homeownership Is Closer Than You Think?

One of the biggest surprises I see as a mortgage broker is how many people assume they can’t buy a home.

They’ve never asked.

They’ve never run the numbers.

They’ve simply assumed.

Sometimes they’re right.

But quite often…

They’re pleasantly surprised.

We’ve helped clients realize they were much closer than they thought because they finally looked at the numbers instead of the headlines.

Spend With Purpose

Life isn’t meant to be lived waiting for “someday.”

Go to the concert.

Travel.

Watch the match.

Celebrate with family.

Create memories.

But do it because you’ve made a conscious choice—not because you haven’t taken five minutes to understand what those choices mean for your future.

Financial freedom isn’t built by never spending money.

It’s built by spending it on purpose.

Before You Decide You Can’t…

If you’ve been telling yourself that homeownership is out of reach, I’d encourage you to challenge that assumption.

Let’s have a conversation.

No pressure.

No obligation.

Just real numbers and honest advice.

You might discover that your dream home is closer than you think.

And if not?

At least you’ll have a plan to get there.

Because the best financial decisions aren’t made based on fear.

They’re made with information.

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Livian Smith
Mortgage Broker | Advice for Life

Helping Canadians make informed mortgage decisions—one conversation at a time.

Let’s talk about something that might sting a little.

When was the last time you reviewed your mortgage?

Not your Netflix subscription.

Not your cell phone plan.

Not whether you’re paying too much for strawberries these days.

Your mortgage.

For most Canadians, their mortgage is the single largest financial commitment they’ll ever have, yet many people sign the paperwork and don’t think about it again until renewal time.

That’s a bit like buying a car and never changing the oil.

“But My Mortgage Is Fine…”

Maybe.

Maybe not.

Over the last year, I’ve reviewed mortgages for homeowners who thought everything was working perfectly, only to discover opportunities to save hundreds or even thousands of dollars every month.

Sometimes it’s because rates have changed.

Sometimes it’s because life has changed.

And sometimes it’s because nobody has looked at their mortgage strategy in years.

Your Mortgage Should Evolve With Your Life

Think about where you were three years ago.

Different income?

Different goals?

Different family situation?

Different debt levels?

Maybe you’ve received a raise.

Maybe you’ve started a family.

Maybe you’ve accumulated some high-interest debt.

Maybe you’re planning renovations.

Maybe you’re thinking about buying a rental property.

The mortgage that made sense then may not be the mortgage strategy that makes sense now.

Real Savings Are Happening

A mortgage review isn’t about finding a lower rate just for the sake of finding a lower rate.

It’s about looking at the whole picture.

We’ve helped clients:

• Reduce monthly payments

• Consolidate high-interest debt

• Improve cash flow

• Create a plan to become mortgage-free sooner

• Position themselves for future home purchases

In some cases, homeowners have improved their monthly cash flow by over $2,000 per month.

Not because someone waved a magic wand.

Because they finally reviewed a mortgage that hadn’t been looked at in years.

The Cost of Doing Nothing

Here’s the uncomfortable truth.

Doing nothing is still a decision.

Every month that passes without reviewing your mortgage strategy is another month you could be missing opportunities to improve your financial position.

Maybe there aren’t any changes to make.

That’s great.

At least you’ll know.

But if there are opportunities available, wouldn’t you rather find out now instead of years from now?

The Good News

A mortgage review doesn’t obligate you to make any changes.

There is no pressure.

No commitment.

No awkward sales pitch.

Just a conversation about where you are today and whether your mortgage is still helping you achieve your goals.

Sometimes the best outcome is confirming you’re already in a great position.

Sometimes it’s discovering opportunities you didn’t even know existed.

Let’s Find Out

If it’s been more than a year since you’ve reviewed your mortgage, or if your life has changed significantly since you got it, it might be time for a second look.

Because if there is an extra $500, $1,000, or even $2,000 hiding in your monthly budget, wouldn’t you rather keep it than give it away?

And if everything looks perfect?

You can go back to worrying about the price of strawberries.

---

Livian Smith
Mortgage Broker | Advice for Life

Ready for a complimentary mortgage review?

Head over to LivianSmith.ca to learn more and book a time to chat.

 

Now for some news that doesn’t make us want to lie down in the Costco parking lot.

Housing costs continued to cool in May.

Mortgage interest costs actually declined slightly compared to last year.

Rent inflation also eased to its slowest pace since early 2022.

In other words, after spending the last few years behaving like an unsupervised toddler who found a drum set and an energy drink, housing costs are finally calming down.

For homeowners and future buyers, that’s encouraging news.

It’s the financial equivalent of hearing, “We’re all good here.”

So… Are Interest Rates Going Up Again?
I know.

You didn’t read 800 words about inflation because you’re passionate about economic indicators.

You want the answer to one question:

“Are rates going up again?”

According to Dr. Sherry Cooper, probably not.

Her expectation is that the Bank of Canada will remain on hold through the rest of 2026.

Which is economist language for:

“Everybody keep your hands and feet inside the ride.”

The inflation numbers the Bank really pays attention to are still behaving themselves.

Nobody at the Bank of Canada appears to be running through the hallways screaming into a clipboard.

What Does This Mean for You?
It means you can stop checking mortgage rates every time you open your phone.

At least for now.

The reality is that most Canadians aren’t being crushed by one giant expense.

They’re being nibbled to death by ducks.

Gas is up.

Groceries are up.

Insurance is up.

Your streaming subscriptions somehow multiplied while you weren’t looking.

And every trip to Costco starts with:

“I’m just grabbing one thing.”

Which is adorable.

Twenty minutes later you’re wheeling out a kayak, a flat of sparkling water, and enough snacks to survive a minor apocalypse.

That’s why reviewing your finances matters.

Not because something is wrong.

But because small leaks become big leaks.

I’ve reviewed mortgages for clients who were convinced everything was fine, only to discover opportunities that could save them hundreds or even thousands of dollars each month.

And unlike tomatoes, mortgage savings don’t suddenly increase by 45%.

My Take
The inflation headlines are giving major “we need to talk” energy.

Terrifying at first.

Usually less dramatic once you know the full story.

Yes, inflation moved higher.

Yes, groceries continue to test both our patience and our budgets.

And yes, tomatoes have fully entered their celebrity era and now require their own security detail.

But beneath the scary headlines, the bigger picture remains relatively stable.

Housing costs are easing.

Core inflation remains contained.

And according to Dr. Sherry Cooper, the Bank of Canada appears comfortable staying right where it is.

So before you cancel your vacation, build a bunker, or start growing tomatoes in your backyard as a retirement strategy, take a breath.

The economy isn’t perfect.

But it’s also not on fire.

Unlike the price of produce.

It has been a buyer’s market for a while now, but many buyers still feel stuck.

On paper, buyers have more choice, more time, and more negotiating power than they had during the peak frenzy. In Metro Vancouver, May 2026 sales were still below long-term seasonal averages, while active listings remained elevated compared to typical levels. That means buyers may have more selection than they have had in recent years. Greater Vancouver Realtors

But even with more inventory, buying a home still does not feel easy for many people.

Interest rates, qualification rules, monthly payments, closing costs, job uncertainty, and the fear of making the wrong decision are all very real. A buyer’s market does not magically make homes affordable. It simply changes the conversation.

Instead of rushing, competing, and removing conditions, buyers may now have more room to slow down and make better decisions.

That can mean:

Having time to review the property properly
Including financing and inspection conditions
Comparing more than one property
Negotiating on price, dates, or terms
Making decisions based on numbers, not panic

This is where mortgage strategy becomes so important.

A buyer’s market does not mean every buyer should buy. It means prepared buyers may have an opportunity to buy more strategically.

Before writing an offer, it is important to understand your full picture. That includes your down payment, closing costs, monthly payment comfort zone, credit, income, debt, and long-term goals.

The purchase price matters, but it is not the only number that matters.

A lower purchase price is helpful, but the real question is: can you comfortably carry the home, and does the mortgage strategy support your life?

Some buyers are waiting for rates to drop. Some are waiting for prices to drop further. Some are waiting because they are overwhelmed and do not know where to start.

There is nothing wrong with waiting if waiting is the right decision for you.

But if you are financially ready, this type of market may give you something that buyers did not always have over the last few years: breathing room.

More choice.
More time.
More ability to negotiate.
More opportunity to do proper due diligence.

The key is not to buy because the market says it is a good time.

The key is to buy when your numbers, your goals, and your comfort level all line up.

If you are wondering whether buying makes sense for you in today’s market, the best first step is not looking at listings. It is understanding your mortgage options, your monthly payment, and what you can comfortably afford.

Because a buyer’s market does not mean buying feels easy.

It means buying should be done with a plan.

Livian Smith
Dominion Lending Centres Producers West Financial

Our Door is Always Open!

Bank of Canada Holds Rates Steady: What It Means for Homeowners and Buyers

The Bank of Canada has once again held its overnight lending rate at 2.25%, choosing to leave rates unchanged amid ongoing economic uncertainty.

For Canadians wondering whether rates are going up, down, or staying put, today’s announcement provides an important signal: the Bank believes current interest rates are appropriate for the economic conditions we’re facing right now.

Why Did the Bank Hold Rates?

Several factors are influencing the Bank’s decision:

• Inflation remains elevated at 2.8%, although core inflation has eased closer to the Bank’s 2% target.

• Ongoing geopolitical tensions continue to impact global markets, particularly energy prices.

• Trade uncertainty remains a concern as Canada, the United States, and Mexico continue negotiations surrounding the future of CUSMA.

• Economic growth in Canada has slowed, but recent data suggests the economy may be stabilizing after a weak start to the year.

The Bank of Canada is walking a careful line between controlling inflation and avoiding additional pressure on an already soft housing market.

What Does This Mean for Mortgage Rates?

While the Bank of Canada rate directly impacts variable-rate mortgages and lines of credit, fixed mortgage rates are influenced more by bond markets.

Recent increases in bond yields and global uncertainty have placed upward pressure on fixed mortgage rates. However, today’s announcement suggests the Bank is not currently eager to increase borrowing costs further.

The current expectation among economists is that rates will likely remain stable through the remainder of the year.

Could Rates Still Go Higher?

It’s possible, but it is not the base-case forecast.

If inflation begins rising more broadly across the economy, the Bank could consider future rate hikes. However, policymakers are also aware that higher rates could further weaken housing activity and affordability.

For now, the most likely scenario is a period of stability while the Bank monitors inflation, economic growth, and global developments.

What Should Homeowners and Buyers Be Doing?
Rather than trying to predict every rate announcement, focus on building a mortgage strategy that fits your long-term goals.

Questions worth considering include:

• Does a fixed or variable rate align better with your comfort level?
• Are you planning to move, refinance, or renew in the next few years?
• Could a different mortgage structure help you pay off your mortgage faster?
• How would your finances handle future rate fluctuations?

Every situation is different, which is why mortgage planning should go beyond simply finding the lowest rate.

Final Thoughts

The Bank of Canada continues to take a cautious approach. While inflation remains above target, economic growth has softened, and uncertainty surrounding global trade and energy markets remains high.

For now, rates appear likely to stay where they are, giving homeowners and buyers a chance to focus on long-term financial planning rather than reacting to every headline.

If you have questions about your mortgage, upcoming renewal, purchase plans, or whether a fixed or variable strategy makes sense for you, I’d be happy to help.

Source: Adapted from analysis by Dr. Sherry Cooper, Chief Economist, Dominion Lending Centres.

Canada’s Economy Sends a Strong Message: Recession Fears Put on Hold

If you’ve been following the headlines lately, you’ve probably heard plenty of talk about a potential recession, economic uncertainty, tariffs, and rising costs. However, Canada’s latest employment report tells a very different story.

In May, the Canadian economy added an impressive 87,800 jobs, the strongest monthly gain since 2024. This significant jump surprised economists and suggests that Canada’s economy remains far more resilient than many expected.

What Happened?
Several key indicators showed strength across the country:

• Unemployment fell to 6.6%
• Full-time employment increased by 154,000 positions
• Employment gains were seen in construction, transportation, hospitality, manufacturing, and recreation
• British Columbia added approximately 25,000 jobs
• Ontario led the way with 42,000 new jobs
• Average wages increased by 3.0% compared to last year

Perhaps most encouraging was the broad-based nature of the gains. Employment increased among private sector workers, public sector workers, and across several major industries.

What Does This Mean for Interest Rates?

Whenever economic data comes in stronger than expected, one of the first questions people ask is:

“Will this cause the Bank of Canada to raise rates?”

While a strong labour market can create inflationary pressure, the answer is likely not anytime soon.

Canada’s housing market remains relatively fragile, and housing plays a much larger role in our economy than it does in the United States. Although inflation remains a concern, particularly with higher energy costs and ongoing global uncertainty, economists continue to believe that both the Bank of Canada and the U.S. Federal Reserve are unlikely to raise rates this year.

What This Means for Homeowners and Buyers

For Canadians considering buying a home, renewing a mortgage, or refinancing, this report is encouraging news.

A stronger job market generally means:

• Greater consumer confidence
• More stable household finances
• Improved economic growth
• Reduced recession concerns

At the same time, the Bank of Canada appears cautious about making any moves that could further pressure the housing market.

While no one can predict the future with certainty, today’s economic environment continues to support the view that interest rates are more likely to remain stable than move significantly higher in the near term.

My Take

As a mortgage broker, I always encourage clients to look beyond the headlines.

One economic report doesn’t tell the whole story, but this jobs report is an important reminder that Canada’s economy remains remarkably resilient despite higher borrowing costs, trade uncertainty, and global challenges.

If you’re wondering how today’s economic environment could impact your mortgage, renewal, refinance, or home-buying plans, let’s have a conversation. Every situation is unique, and the right strategy is about much more than simply chasing the lowest rate.

The goal is finding a mortgage that fits your life today while supporting your goals for the future.

Source: Dr. Sherry Cooper, Chief Economist, Dominion Lending Centres. This article is based on Dr. Cooper’s analysis of Canada’s May Labour Market Survey and related economic data.

The Hidden Financial Reality of “Grey Divorce” for Canadian Women

By Livian Smith, Licensed Mortgage Professional
Dominion Lending Centres Producers West Financial

Divorce later in life — often called “grey divorce” — is becoming more common across Canada. But behind the statistics are real women quietly asking themselves difficult questions:

“Can I afford to leave?”
“Will I be okay financially?”
“What happens to my retirement?”

A recent article by financial writer Melanie Huddart explored the growing financial concerns facing women over 50 who are considering separation after long-term marriages.

And honestly? This conversation matters.

Because for many women, especially those who stepped back from careers to raise children, support a spouse’s career, or care for family members, leaving a marriage isn’t just emotional. It can feel financially terrifying.

 

Why “Grey Divorce” Feels Different

When divorce happens later in life, there’s often less time to rebuild financially before retirement.

Many women in this stage of life may have:

• Smaller RRSPs
• Fewer CPP contributions
• Limited personal credit history
• Assets tied up in the family home
• Concerns about cash flow and retirement income

At the same time, they may also have substantial equity, investments, pensions, or rights they don’t fully understand yet.

One important point highlighted in the article is that even if a spouse’s name is the only one on title, the matrimonial home is still often considered shared property under provincial family law.

That surprises a lot of people.

 

The Emotional Side Nobody Talks About

What I see in real life is that many women stay stuck not because they don’t want change, but because they’re overwhelmed by uncertainty.

Questions start spinning:

• “Will I have enough income?”
• “Will I lose my home?”
• “Can I qualify for financing on my own?”
• “What happens to my retirement plans?”

Sometimes people assume they have to make a massive decision immediately.

They don’t.

The first step is simply understanding the full financial picture.

 

The Family Home Can Become a Tool — Not Just a Stress Point

For many Canadians over 50, the largest asset they own is their home.

And while that equity can feel inaccessible, there are actually multiple strategies that may help create flexibility depending on the situation:

• Refinancing
• Buyout options
• Reverse mortgages (also known as payment optional mortgages)
• Secured lines of credit
• Downsizing strategies
• Pension and asset equalization planning

Every situation is different, which is why having the right team matters:

• Family lawyer
• Financial planner
• Mortgage professional
• Accountant

Not just one person trying to figure everything out alone.

 

Retirement Planning Changes After Divorce

The article also highlighted how critical it is to review:

• CPP credit splitting
• Timing of CPP and OAS
• RRSP/RRIF withdrawal strategies
• Tax implications
• New monthly budgets as a single-income household

For many people, retirement after divorce may look different than originally expected — but different does not automatically mean impossible.

Sometimes it simply means restructuring.

 

A Conversation Worth Having

If you’re navigating separation later in life, or even quietly thinking about your options, you do not need to have every answer today.

But understanding what may be possible financially can reduce a tremendous amount of fear.

Many people are surprised to learn they may have more options, more equity, and more flexibility than they originally believed.

And sometimes, clarity alone can bring peace of mind.

If you’re curious what financing options may exist in your situation — whether that’s staying in your home, accessing equity, restructuring debt, or understanding retirement cash flow — it can help to have a confidential conversation with professionals who understand both the emotional and financial side of major life transitions.

To read the original article by Melanie Huddart, visit Money.ca.

Canadian Homebuyers Trying To Beat Rate Hikes.

Today the Canadian Real Estate Association (CREA) released statistics showing national existing-home sales rose 0.6% in November following the whopping 8.6% surge the month before. Sales could have been higher had it not been for the limited supply of homes for sale. Homebuyers are anxious to finalize purchases before the Bank of Canada hikes interest rates next year.Across the country, sales gains in Calgary, Edmonton, the B.C. interior, Regina and Saskatoon offset declines in activity in the GTA and Montreal.

The actual (not seasonally adjusted) number of transactions in November 2021 was firm historically, edging down a scant 0.7% on a year-over-year basis, missing the 2020 record for that month by just a few hundred transactions.

On a year-to-date basis, some 630,634 residential properties have traded hands via Canadian MLS® Systems between January and November 2021, far surpassing the annual record 552,423 sales for all of 2020.

“The fact is that the supply issues we faced going into 2020, which became much worse heading into 2021, are even tighter as we move into 2022. Interest rate hikes will make it even harder for new entrants to break into the market next year, even though activity may remain robust as existing owners continue to move around in response to all of the changes to our lives since COVID showed up on the scene. As such, the issue of inequality in the housing space will remain top of mind. One wildcard will be what policymakers decide to do with the national mortgage stress test, which could act as a kind of cushion against rising rates for young and/or first-time buyers. It could also make things that much harder for them,” said Shaun Cathcart, CREA’s Senior Economist.

 

New Listings

The number of newly listed homes rose by 3.3% in November compared to October, driven by gains in a little over half of local markets, including the GTA, Lower Mainland, Montreal, and many markets in Ontario’s Greater Golden Horseshoe.

With new listings up by more than sales in November, the sales-to-new listings ratio eased a bit to 77% compared to 79.1% in October. The long-term average for the national sales-to-new listings ratio is 54.9%.

About two-thirds of local markets were seller’s markets based on the sales-to-new listings ratio being more than one standard deviation above its long-term mean. The other one-third of local markets were in balanced market territory.

There were just 1.8 months of inventory on a national basis at the end of November 2021, tied with March 2021 for the lowest level ever recorded. The long-term average for this measure is more than 5 months.

 

Home Prices

In line with some of the tightest market conditions ever recorded, the Aggregate Composite MLS® Home Price Index (MLS® HPI) was up another 2.7% on a month-over-month basis in November 2021.
The non-seasonally adjusted Aggregate Composite MLS® HPI was up by a record 25.3% year-over-year in November.

Year-over-year price growth has crept back up to nearly 25% in B.C., though it remains lower in Vancouver, on par with the provincial number in Victoria, and higher in other parts of the province.

Year-over-year price gains are still in the mid-to-high single digits in Alberta and Saskatchewan, while gains have risen to about 13% in Manitoba.

Ontario saw year-over-year price growth hit 30% in November, with the GTA continuing to surge ahead after trailing most other parts of the province for most of the pandemic.

Greater Montreal’s year-over-year price growth remains at a little over 20%, while Quebec City was only about half that.

Price growth is running above 30% in New Brunswick (higher in Greater Moncton, lower in Fredericton and Saint John), while Newfoundland and Labrador is now at 10% year-over-year (lower in St. John’s).

 

Bottom Line–Lots of News Today

Canada continues to contend with one of the developed world’s most severe housing shortages; as our borders open to a resurgence of immigration, excess demand for housing will mount. The impediments to a rapid rise in housing supply, both for rent and purchase, are primarily in the planning and approvals process at the municipal and provincial levels. Liberal Party election promises do not address these issues.

Inflation pressures are mounting everywhere. The US posted a year-over-year inflation rate for November at 6.8%, up from 6.2% posted the month before. This undoubtedly led the US Federal Reserve to issue a hawkish statement today, intensifying their battle against inflation. They announced that they will double the pace at which it’s scaling back purchases of Treasuries and mortgage-backed securities to $30 billion a month, putting it on track to conclude the program in early 2022, rather than mid-year as initially planned.

Projections published alongside the statement showed officials expect three quarter-point increases in the benchmark federal funds rate will be appropriate next year, according to the median estimate, after holding borrowing costs near zero since March 2020.

According to Bloomberg News, “The faster pullback puts Powell in a position to raise rates earlier than previously anticipated to counter price pressures if necessary, even as the pandemic poses an ongoing challenge to the economic recovery. The Fed flagged concerns over the new omicron strain, saying that risks to the economic outlook remain, including from new variants of the virus.”

On more positive news, Canada’s inflation rate held steady at 4.7% y/y in November, well below the pace in the US. Excluding food and energy products, CPI ticked slightly lower to 3.1% from a year ago in November, or 2.7% on an annualized seasonally adjusted basis relative to the pre-shock February 2020 level. Roughly half of that 2.7% can still be attributed to rising expenses related to home-owning and car purchase or leasing. But the breadth of inflation pressure has also widened, with 58% of the consumer basket seeing faster-than-2% annualized growth in November from pre-pandemic (2019) levels on average over the last three months. That compares to 47% in February 2020. The broadening is expected to carry on in 2022 as rising input, transport and labour expenses continue to flow through supply chains for a wider swath of goods and services. Further disruptions to supply chains and energy markets from Omicron and the BC flood later in November are expected to add to price uncertainties in the near term.

In a speech today, Governor Tiff Macklem of the Bank of Canada assured the public that the Bank of Canada would remain the country’s number-one inflation fighter. Macklem clarified that flexibility in their new mandate won’t apply in situations — like now — when inflation is considerably above target.

At a press conference after the speech, Macklem noted he wasn’t comfortable with current elevated levels of inflation and the “time is getting closer” for policymakers to move away from the forward guidance. Markets are pricing in five interest rate hikes next year by the Bank of Canada.

 

Published DLC’s Chief Economist Dr Sherry Cooper