Canadian Housing Continues to Moderate in May

General Robyn McLean 18 Jun

Current housing market review by Dominion Lending’s Dr. Sherry Cooper.

The Slowdown In Canadian Housing Continued in May
Today, the Canadian Real Estate Association (CREA) released statistics showing national existing home sales fell 7.4% nationally from April to May 2021, building on the 11% decline in April. Over the same period, the number of newly listed properties fell 6.4%, and the MLS Home Price Index rose 1.0%, a marked deceleration from previous months.

Activity nonetheless remains historically high, but in contrast to March’s all-time record, it is now running closer to levels seen in the second half of 2020 (see chart below). Month-over-month declines in sales activity were observed in close to 80% of all local markets. It was a mixed bag of results, with a slowdown in sales observed in most large markets across Canada.

“While housing markets across Canada remain very active, we now have two months of moderating activity in the books, and that goes for demand, supply and prices,” stated Cliff Stevenson, Chair of CREA. “More and more, there is anecdotal evidence of offer fatigue and frustration among buyers, and the urgency to lock down a place to ride out COVID would also be expected to fade at this point given where we are with the pandemic”.

New Listings

The number of newly listed homes declined by 6.4% in May compared to April. New listings were down in about 70% of all local markets in May.

The national sales-to-new listings ratio was 75.4% in May 2021, down slightly from 76.2% posted in April. The long-term average for the national sales-to-new listings ratio is 54.6%, so it remains historically high; although, it has been moderating since peaking at 90.7% back in January.

Based on a comparison of sales-to-new listings ratio with long-term averages, only about a quarter of all local markets were in balanced market territory in May, measured as being within one standard deviation of their long-term average. The other three-quarters of markets were above long-term norms, in many cases well above.

As the chart below shows, Edmonton was one market in balance, and the Greater Vancouver Area was moving closer to balance, but others remain a seller’s market.

There were 2.1 months of inventory on a national basis at the end of May 2021, up from a record-low 1.7 months in March but still well below the long-term average for this measure of over 5 months.

Home PricesThe Aggregate Composite MLS® Home Price Index (MLS® HPI) rose 1% month-over-month in May 2021 – a noticeable deceleration. The most recent deceleration in month-over-month price growth has come from the single-family space compared to the more affordable townhome and apartment segments.

The non-seasonally adjusted Aggregate Composite MLS® HPI was up 24.4% on a year-over-year basis in May. Based on data back to 2005, this was another record year-over-year increase; although, it is not likely to go much higher.

While the largest year-over-year gains continue to be posted across Ontario, this is also where month-over-month price growth has been slowing the most. Meanwhile, price growth has continued to accelerate in some other parts of the country, thus reducing the year-over-year growth disparity between Ontario and other provinces.

Bottom Line

The near-uniform nature of the housing market activity (in what is usually a highly regionalized market) is still a key feature of this cycle. Indeed, 22 of 26 markets tracked by CREA saw sales fall in May, while all but one market saw the average transaction price up by double-digits from a year ago (sorry, Thunder Bay). Among the tightest markets in the country based on the sales-to-new listings ratio are the Okanagan and Kawartha Lakes; cottage country is still on fire.

The two-month slowdown in Canadian housing is welcome news. The OECD recently released a report showing that New Zealand, Canada and Sweden have the frothiest housing markets in the world. The UK and the US are near the top as well. Clearly, COVID led many around the world to alter their abode, driving prices higher almost everywhere.

Bank of Canada holds benchmark interest rates steady, updates its economic outlook

General Robyn McLean 11 Jun

Insight on the latest Bank of Canada announcement from our friends at First National.

  • Jun 9, 2021
  • First National Financial LP

This morning, in its fourth announcement of 2021, the Bank of Canada left its target overnight benchmark rate unchanged at 0.25%. As a result, the Bank Rate stays at 0.5%. It also provided somewhat encouraging thoughts on the state of, and outlook for, the Canadian and global economies and updated its outlook on inflation. Here is a summary:

Canadian economic conditions

  • Economic developments have been broadly in line with the Bank’s outlook published in the April Monetary Policy Report
  • First quarter GDP growth came in at a robust 5.6% and while this was lower than the Bank originally projected, “the underlying details indicate rising confidence and resilient demand”
  • Household spending was stronger than expected, while businesses drew down inventories and increased imports “more than anticipated”
  • Economic activity so far in the second quarter has been dampened, largely as anticipated, due to renewed lockdowns associated with the third wave of COVID-19 and recent jobs data show that workers “in contact-sensitive sectors” have once again been negatively affected


  • CPI inflation has risen to around the top of the Bank’s 1-3% inflation-control range, due largely to base-year (2020) effects and much stronger gasoline prices
  • Core measures of inflation have also risen, due primarily to temporary factors and base year effects, but by much less than CPI inflation
  • While CPI inflation will likely remain near 3% through the summer, it is expected to ease later in the year, as base-year effects diminish and excess capacity continues to exert downward pressure

Global conditions

  • With COVID-19 cases falling in many countries and vaccine coverage rising, global economic activity is picking up
  • The US is experiencing a strong consumer-driven recovery and a rebound is beginning to take shape in Europe, while a resurgence of the virus is hampering the recovery in some emerging market economies
  • Financial conditions remain highly accommodative, reflected in broadly higher asset prices

Looking forward

Despite progress on vaccinations, there continues to be uncertainty about the evolution of new COVID-19 variants. However, with provincial containment restrictions on an easing path over the summer, the Bank still expects the Canadian economy to rebound strongly, led by consumer spending. Growth in foreign demand and higher commodity prices should also lead to a solid recovery in exports and business investment, according to the Bank.

With respect to the housing market, the Bank’s only comment was that “activity is expected to moderate but remain elevated.” In April, the Bank opined that housing construction and resales were at historic highs, “driven by the desire for more living space, low mortgage rates, and limited supply” and noted that it would continue to monitor the potential risks associated with the rapid rise in house prices.”

Policy measures

The BoC’s Governing Council noted that there remains considerable excess capacity in the Canadian economy, and that the recovery continues to require “extraordinary monetary policy support.”

Accordingly, the Bank said it remains committed to holding its policy interest rate at what it calls the effective lower bound until economic slack is absorbed and its 2% inflation target is “sustainably achieved.” This may happen sometime in the second half of 2022.

As well, the Bank reiterated that it would continue its Quantitative Easing program – at a target pace of $3 billion per week – to keep interest rates low across the yield curve. It also added that: “Decisions regarding adjustments to the pace of net bond purchases will be guided by Governing Council’s ongoing assessment of the strength and durability of the recovery. We will continue to provide the appropriate degree of monetary policy stimulus to support the recovery and achieve the inflation objective.”

The bottom line

Today’s announcement falls under the heading no news is good news. The benchmark rate is unchanged, the economic recovery appears to be unfolding largely as expected and bond buying activity will continue to provide monetary policy support in the near term.

All of this suggests now is a good time to borrow but also with a view toward developing mid to long-term financing strategies that will address future conditions including the potential for policy interest rate increases next year.

  • Jun 9, 2021
  • First National Financial LP

How The New Stress Test Will Impact Home Buyer Affordability Across Canada

General Robyn McLean 7 Jun

Some great insight on the increase of the stress-test in Canada from our friends at Zoocasa.

How The New Stress Test Will Impact Home Buyer Affordability Across Canada

As of today, it’ll be a bit tougher for new and renewing mortgage borrowers to qualify for their home loan. A higher threshold for the “stress test” has come into effect, requiring borrowers to prove they can carry their mortgage costs at an interest rate of 5.25% or their contract rate plus 2%, whichever is higher. This is a slight increase from the previous threshold of 4.79%. The stricter criteria applies to both insured mortgage borrowers (those who make a down payment smaller than 20% on their home purchase) and uninsured borrowers, who put down 20% or more.

What Does the Stress Test Do?

Simply put, in order to pass the stress test, borrowers must have healthy-enough incomes and debt servicing ratios to indicate they could pay their mortgage payments at the higher interest rate, regardless of the rate they actually get from their lender. For context, current fixed and variable mortgage rates are as low as 1.7% – 2% for a five-year term, so the stress test will tack on at a minimum 3% or higher. This translates to borrowers qualifying for a smaller mortgage amount.

How Will the Stress Test Impact Home Buyers?

However, as borrowers have been stress tested since 2018, the impact of this latest change will be fairly minimal. According to analysis conducted by Zoocasa, a buyer looking to purchase the average-priced home in their city would face a dip in affordability of about 3.8%, with between $14,000 – $47,000 shaved off the amount they’d qualify for. To make up for this difference, the study determined borrowers would need to supplement their incomes between $2,000 – $9,000 in order to qualify for the same size mortgage under the new stress test, depending on the city they’re purchasing in.

To determine these differences, Zoocasa calculated the income required to qualify for a mortgage large enough to purchase the average-priced home in 11 cities across Canada at both a mortgage rate of 4.79%, and then at 5.25%. It was assumed home buyers had no additional debt, were making a 20% down payment, and were amortizing their mortgage over 30 years.

Borrowers would see the largest dollar amount slashed from their qualification in Greater Vancouver, where the average home price was $1,211,223 in April; they’d receive $47,170 less on their mortgage, and would need to supplement their income by $9,000 to qualify for the same sized mortgage post stress test.

Next was Greater Toronto, where qualification would be reduced by $42,475 on the average home price of $1,090,992, resulting in a requirement of $8,000 in additional income.

The buyers least impacted by the stress test were found in Saskatoon and Winnipeg, where average home prices are $347,616 and $353,377, respectively. Qualification amounts in each would be reduced by $13,661 and $13,875, requiring an income increase of $2,000 to qualify for the same size mortgage.

Check out the infographic below to see how the stress test impacts average home buyers across Canada:

Map of Buyer Affordability in Canada after new Stress Test

Why Is the Stress Test Being Increased?

The tougher stress test is part of efforts by both the federal banking regulator (OSFI) and Department of Finance to reduce the amount of risky mortgage debt currently held by Canadians as a result of the pandemic home buying boom. Part of the issue is the aforementioned historically low mortgage rates; interest rates have been kept at record lows over the past year by the Bank of Canada to protect the economy and keep liquidity in the market. However that’s made it cheaper to get a mortgage than ever before; combined with lockdown buyer psychology and pent-up savings, buyers have been motivated to get into the housing market at an unprecedented rate.

That has pushed home prices to stratospheric new heights in markets across Canada, as buyers working and schooling from home have sought properties with more space. The ability to work from home has also decoupled them from big city centres and shifted demand to smaller suburban and rural markets, known for their comparable affordability. However, supply has struggled to keep up with demand. Bidding wars and homes selling for far over their listing price has become the norm, even in secondary markets where these dynamics were previously rare. The Canadian Real Estate Association reports the average home price soared by 41.9% in April to $696,000, with average home prices easily topping the million-mark in the most in-demand markets.

As a result, more home buyers have had to bid higher than they otherwise would have to win their homes, and have taken on larger mortgages. The concern is that when interest rates do inevitably rise, these newly-minted homeowners will struggle to keep up with their mortgage debt. In fact, overly-leveraged households pose one of the largest risks to the economy, according to the Bank of Canada. In their most recent Financial Systems Review, the central bank states, “The biggest domestic vulnerabilities are those linked to imbalances in the housing market and high household indebtedness. These are not new, but they have intensified because of the unusual circumstances caused by the pandemic.”

The BoC adds that buyer expectations have become “extrapolative”, meaning they believe prices will keep rising, fueling their fear of missing out, and hedging on rapidly growing equity in order to afford homes outside of their budgets. This has led to higher levels of mortgage debt, with more borrowers taking on a higher loan-to-income ratio, leaving them potentially financially exposed. The fear is that should an unexpected financial event shock the economy, it could cause a chain reaction of homeowners defaulting on their mortgages.

“It is important to understand that the recent rapid increases in home prices are not normal. Even without a shock, some of the factors that caused prices to rise fast could reverse later, and that could leave some households with less equity in their homes,” states the BoC.

It remains to be seen whether additional methods to cool the housing market will be rolled out by policy makers as the economy recovers from the pandemic. In the meantime, buyers will need to absorb this new affordability requirement when budgeting for their home purchase.


Average, not seasonally adjusted home prices for April 2021 were sourced from the Canadian Real Estate Association. (CREA) Calculations assumed a home purchase down payment of 20%, 30-year amortization, and no additional debt, no condo fees, $125 heating costs, and $331 property tax. Calculations were made using

Another Weak Canadian Jobs Report For May

General Robyn McLean 7 Jun

Stay in-the-know on things that affect our economy and the rebound from Covid 19. Valuable information from Dr. Sherry Cooper, Chief Economist at Dominion Lending. 

Canada’s Jobs Recovery Derailed By Third-Wave Restriction
This morning, Statistics Canada released the May 2021 Labour Force Survey showing another contraction in employment, albeit not as dramatic as in April.  With the geographical broadening in lockdown restrictions in May, employment fell by 68,000 (-0.4%), but almost all of the decline was in part-time work. The number of self-employed workers was virtually unchanged in May but remained 5.0% (-144,000) below its pre-pandemic level.

Among people working part-time in May, almost one-quarter (22.7%) wanted a full-time job, up from 18.5% in February 2020 (not seasonally adjusted).

The number of Canadians working from home held steady at 5.1 million. This is similar to the number of telecommuters in the spring of last year.

After falling in April, total hours worked were little changed in May.

Employment in the goods-producing sector dropped for the first time since April 2020, with decreases in both the manufacturing and construction industries. Ontario and Nova Scotia were the only provinces to register declines in total employment.

Employment increased in Saskatchewan, while there was little change in all other provinces.

Unemployment little changed

The unemployment rate was little changed at 8.2% in May, as the number of people who searched for a job or who were on temporary layoff held steady. The unemployment rate remained lower than the recent peak of 9.4% seen in January 2021 and considerably lower than its peak of 13.7% in May 2020.

The unemployment rate among visible minority Canadians aged 15 to 69 rose 1.5 percentage points to 11.4% in May (not seasonally adjusted).

Long-term unemployment—the number of people unemployed for 27 weeks or more—held relatively steady at 478,000 in May.

Full-time employment was little changed in May, following a decline of 129,000 (-0.8%) in April. Before April, full-time employment had steadily trended upwards, following the low in April 2020. In May 2021, the number of full-time workers was down 1.9% (-303,000) from its pre-pandemic level.

Private sector employees in sales and services most affected by restrictions

The number of private-sector employees declined by 60,000 in May (-0.5%), adding to losses observed in April (-204,000; -1.7%). This followed employment gains totalling 427,000 in February and March 2021—demonstrating the extent to which employment for this group of workers has been affected by the easing and tightening public health measures introduced to contain the COVID-19 pandemic.

Compared with February 2020, the number of private-sector employees was down 564,000 (-4.6%), with the gap driven mostly by declines in the number of people working in the accommodation and food services industry, particularly those working in sales and services occupations (not seasonally adjusted).

Employment in construction falls with tightening of public health restrictions in ON

Employment in construction fell by 16,000 (-1.1%) in May, driven by declines in Ontario, where public health restrictions affecting non-essential construction were implemented on April 17. The decrease brought the number of workers in construction down to 3.7% (-55,000) below pre-COVID levels.

Bottom Line 

With the easing of COVID restrictions beginning this month, we expect a sharp bounceback in job creation starting in the next employment report. The potential for a sharp rebound and a faster-than-expected full recovery has already prompted the Bank of Canada to start tapering its stimulus with reduced bond buying. Markets are expecting rate hikes by the Bank to begin next year.

Canada’s economy remains 571,100 jobs shy of pre-pandemic levels. The unemployment rate was below 6% before the pandemic.

The Canadian jobs report coincided with the release of U.S. payroll numbers, which increased by 559,000 last month — short of an expected 675,000–but well above the surprisingly weak job growth in April.

Housing is Driving The Canadian Economy

General Robyn McLean 2 Jun

Great insight on our current economic rebound from Dr. Sherry Cooper, Chief Economist at Dominion Lending.

Housing Drove the Economic Expansion in Q1
Yesterday’s Stats Canada release showed that the economy grew at a 5.6% annualized rate in the first quarter, after a revised 9.3% pace in the final quarter of last year.  That was somewhat below economists’ expectations. Housing investment grew at an annualized 43% pace, by far the biggest impetus of the expansion. Residential investment now makes up a record proportion of GDP (see chart below). Compared with the first quarter of 2020, housing investment was up 26.5% and led the recovery. Growth in housing was attributable to an improved job market, higher compensation of employees, and low mortgage rates. After adding $63.6 billion of residential mortgage debt in the last half of 2020, households added $29.6 billion more in the first quarter of 2021.

Residential investment is a component of the Gross Domestic Product accounts and is technically called ‘gross fixed capital formation in residential structures’ by Statistics Canada.  Investment in residential structures is comprised of three components: 1) new construction, 2) renovations and 3) ownership transfer costs. The first two components are obvious.

The home-resale market’s contribution to economic activity is reflected in ‘ownership transfer costs.’ These costs are as follows:

  • real estate commissions–including realtors and mortgage brokerage fees;
  • land transfer taxes;
  • legal costs (fees paid to notaries, surveyors, experts etc.); and
  • file review costs (inspection and surveying).

The second chart below shows the quarterly percent change in the components of housing investment in inflation-adjusted terms. This chart illustrates the surge in existing home sales since the second quarter of last year (reflected in the red bar). Although the resale market has slowed since the third quarter of last year, it remains a driving force of economic expansion.

Growth in housing investment was broad-based. New construction rose 8.7% (quarter-over-quarter), largely driven by detached units in Ontario and Quebec. Ownership transfer costs increased 13.1%, with the rise in resale activities. Working from home and extra savings from reduced travel heightened the demand for, and scope of, home renovations, which grew 7.0% in the first quarter.

The increase in GDP in the first quarter of 2021 reflected the continued strength of the economy, influenced by favourable mortgage rates, continued government transfers to households and businesses, and an improved labour market. These factors boosted the demand for housing investment while rising input costs heightened construction costs.The GDP implicit price index, which reflects the overall price of domestically produced goods and services, rose 2.9% in the first quarter, driven by higher prices for construction materials and energy used in Canada and exported. The sharp increase in prices boosted nominal GDP (+4.3%). Compensation of employees rose 2.1%, led by construction and information and cultural industries, and surpassed the pre-pandemic level recorded at the end of 2019.

Strength in oil and gas extraction, manufacturing of petroleum products, and construction industries led to a higher gross operating surplus for non-financial corporations (+11.5%). Higher earnings from commissions and fees bolstered the operating surplus of financial corporations (+3.9%), coinciding with the sizeable increases in the value and volume of stocks traded on the Toronto Stock Exchange (TSX).

Most aspects of final sales were solid in Q1, with consumers a bit stronger than expected (2.8% a.r.), government adding (5.8%), and net exports also contributing. In contrast, business investment was one real source of disappointment, with equipment spending surprisingly falling. But the biggest drag came from a drop in inventories, with this factor alone cutting growth 1.4 ppts in Q1, and versus expectations, it could add a touch. The good news is that this should reverse in Q2, supporting activity in the current quarter.

On the monthly figures, there were few big surprises. March’s initial flash estimate of +0.9% was nudged up in the official estimate to +1.1% as the economy began to re-open from the second wave. Tougher COVID public health rules slammed the brakes on Canada’s economy in April. Statistics Canada estimates gross domestic product shrank 0.8% in the month, representing the first contraction in a year and a weak handoff heading into the second quarter. April may well be followed by a soft May. Even so, we still expect a strong June will keep Q2 roughly flat overall and look for robust Q3 growth.

Bottom Line

In many respects, Q1 data is ancient history. We know with the resurgence in lockdowns, growth in Q3 will at best be flat. In the hopes that vaccinations will accelerate and COVID case numbers will continue to fall across the country, Q4 will likely see a strong resurgence in growth.

Bank of Canada steps up to the bully pulpit

General Robyn McLean 25 May

Some great insight on market conditions from our friends at First National…and even more reason to get honest & informative advice when looking for mortgage financing! 

In its latest look at the threats to the country’s financial system, the Bank of Canada puts household debt and imbalances in the housing market at the top of the list.

The Bank says these are not new problems, but they have intensified during the pandemic.  Consumer debt has actually dropped in the past year or so, but rising mortgage debt has more than offset that decline.  At the end of last year Statistics Canada reported that the household debt-to-income ratio stood at 170.7, or $1.71 of debt for every $1.00 of disposable income.

The housing boom has been supporting the overall economy in the short-term but it is also adding to the vulnerability of the economy and financial system.  The BoC is also expressing concerns about the declining quality of mortgage borrowing during the pandemic.

The key concern is that any significant economic shock that leads to loss of employment, a drop in income, or a sharp reduction in home prices would force “overstretched” households to cut other spending in order to make their mortgage payments.  That, in turn, would curtail the economy as a whole, and could put significant stress on the financial system.

Just because the central bank says there could be a problem, does not mean there will be a problem.  There are a number of market watchers who see the Bank using its annual Financial System Review as a bully pulpit in an effort to talk down overly exuberant market expectations that might lead to trouble.

Other key concerns include cybersecurity, too much reliance on cheap credit and the possibility of a premature withdrawal of pandemic support for businesses.

  • May 25, 2021
  • First National Financial LP

10 Popular Home Renovation Trends to Tackle This Summer

General Robyn McLean 25 May

Some great summer reno tips from Justin Kirby @ REW. 

 By Justin Kerby May 21, 2021

There are plenty of home renovations you can take on this summer, many of which can increase the value of your property. If your renovation attempts this spring didn’t quite go as planned, or if you’ve been putting them off for longer than you intended, get things started while it’s hot outside and the skies are clear. Here are 10 of the most popular home renovations that you can tackle this summer.

1. Replace your fence

With proper care, a good fence should last roughly 15 years. Unfortunately, in wet climates like Vancouver, you’d be very lucky to hit that number. Wood fences eventually rot and need replacing, and it’s not something you want to be doing in the rain. The summer months are the perfect time to replace your fence.

Alternatively, you could plant cedar trees in front of your fence if greenery is more appealing to you. Cedars can be purchased in all sizes; just keep in mind that the taller they are when you buy them, the more expensive they will be.

2. Deck replacement or addition

Deck additions are easily one of the most popular home renovations in 2021. Outdoor gatherings are one of the few ways friends and family can get together during the pandemic, making having a meeting place like a deck or patio extremely valuable. Deck companies are busy right now, so call early or plan to do the work yourself.

If you already have a deck but would like to update it for the summer, adding a new layer of vinyl is a great way to freshen things up. Replacing rotting wood railings with aluminum or glass railings is another excellent way to improve the look of your deck or patio area (and make things safer as well).

3. Update your roof

A new roof should last you a minimum of 15 years, though they can hold out for much longer than that if you don’t live below large trees. Wood and asphalt shingles are both widespread, though asphalt will need to be replaced sooner in most cases. When it comes to warning signs, watch for any sagging, moss (which can signal trapped moisture), and any patches of shingles that are buckling. If you notice any of these signs, and it’s been over 15 years since the roof was replaced, it’s time to have a professional come out and take a look.

4. Bathroom remodel

Starting a bathroom remodel can seem daunting at first, but once you begin you’ll see that small spaces really aren’t too overwhelming. Retiling your bathroom floors and shower, replacing showerheads and toilets, hanging new mirrors, and adding a new vanity can be done relatively quickly and leave you with a beautiful new space. These renovations often pay for themselves, as they’ll increase your home’s value when it comes time to sell your property.

5. New kitchen backsplash 

The kitchen can be a considerable job depending on how much you want to take on, but a new backsplash is an excellent place to start if you’re looking for a smaller project. A new backsplash can make a kitchen look fresh, or give it a pop of colour depending on your personal preferences. If you’re matching your backsplash colour with your counters (which is common if you’re doing white on white), try to make sure your counters are a slightly warmer tone than your backsplash. This keeps your backsplash looking very clean. Kitchen renovations, in general, are a great way to increase the value of your home.

6. Exterior painting

Interior painting is always a good idea when it comes time to sell your home, but exterior painting shouldn’t be overlooked. The summer months are the perfect time to update the exterior of your home, and adding a fresh coat of paint, even if it’s the same colour as before, really brightens things up. Adding some new trim colours to the exterior, doing a flat stucco job to make things look more modern, or simply removing old wood panelling can go a long way.

7. Window upgrades

Upgrading your windows will not only make your home more attractive and modern, but it will also save you money in the long run. Replacing your windows is one of the best kinds of renovations – those that will save you money every single month, whether you’re keeping the cold air in during the summer months or the warm air in during the winter months. In addition to saving you money on your heating bill, it will also make you money when it comes time to list your property. Double pane, triple pane, and Low-E windows are precisely the kinds of features that energy-efficient buyers are looking for right now.

8. Frame in your carport

You’ll likely need to get a permit to frame in your carport, so be sure to check with your city before you begin this renovation project. It’s become extremely popular to opt for a garage instead of a carport for practical and overall home security reasons.

Look for a garage door with good insulation so that your home stays warm in the colder months. The thicker the door, the better, and with no windows if possible – unless the designer in you needs them!

9. Replace your doors

You’ll be surprised by how much this freshens up your home. Whether it’s replacing those ageing doors in your bedrooms, swapping an old sliding door for a set of beautiful french doors, or replacing your front door with a new exciting design and colour, you’ll enjoy this renovation. For a smaller project, you can update every door handle in your home in just a few hours, and this can also add some charm. Black or brass door handles stand out and make an impression.

10. Add new siding or stucco

If you are going ahead with redoing a deck or framing in a carport, there’s a chance you’ll need to re-stucco or add some siding to your new exterior walls. Siding, in particular, is very low maintenance, and if you opt for fibre cement siding, you’ll be choosing a durable product as well. If your home has stucco, try to find someone to match your current style or pattern. This isn’t an easy task, so be sure to go with a professional with a good track record and plenty of reviews.

These home renovation projects are all extremely popular right now. Don’t be afraid to give home improvement a shot this summer. It’s the perfect time to get started.

Housing Market Slowed in April as Renewed Lockdown Took Its Toll

General Robyn McLean 17 May

Understanding what’s happening in the real estate market from Dr. Sherry Cooper, Chief Economist at Dominion Lending.

Starting to See a Slowdown in Canadian Housing
The Canadian Real Estate Association (CREA) released statistics showing national existing home sales fell 12.4% nationally from March to April 2021. Over the same period, the number of newly listed properties fell 5.4%, and the MLS Home Price Index rose 2.4%.

While home sales fell month-over-month in April, largely due to the new lockdowns, April sales were still the strongest ever for that month and well above the 10-year monthly average.

Month-over-month declines in sales activity were observed in close to 85% of all local markets, including virtually all of B.C. and Ontario.

New ListingsThe number of newly listed homes declined by 5.4% in April compared to March. In a market with historically low inventory, where sales activity depends on a steady supply of new listings each month, the synchronous gains in new supply and sales in March followed by synchronous declines in April suggest the slowdown in sales may be partially about the availability of listings as opposed to only a demand story. New listings were down in 70% of all local markets in April.

The national sales-to-new listings ratio eased back to 75.2% in April compared to a peak level of 90.6% back in January. That said, the long-term average for the national sales-to-new listings ratio is 54.5%, so it is currently still high historically. The good news is that it is moving in the right direction.

Based on a comparison of sales-to-new listings ratio with long-term averages, only about a quarter of all local markets were in balanced market territory in April, measured as being within one standard deviation of their long-term average. The other three-quarters of markets were above long-term norms, in many cases well above.

There were 2 months of inventory on a national basis at the end of April 2021, up from a record-low 1.7 months in March but still well below the long-term average for this measure of a little more than 5 months.

In a separate release, Canadian housing starts fell to 268,600 annualized units in April from the blowout (334.8k) month in March. While down sharply month-over-month, this is still a solid level of new construction activity in Canada by historical standards. In fact, average annualized starts over the past six months run at the strongest level on record, topping building booms in the 1970s and 1980s. All regions but the Prairies and Atlantic Canada saw lower starts in April.

Home PricesThe Aggregate Composite MLS® Home Price Index (MLS® HPI) climbed by 2.4% month-over-month in April 2021 – a historically strong gain but less than in February and March. Most of the recent deceleration in month-over-month price growth has come from the single-family space compared to the more affordable townhome and apartment segments.

The non-seasonally adjusted Aggregate Composite MLS® HPI was up 23.1% on a year-over-year basis in April. Based on data back to 2005, this was a record year-over-year increase.

The largest year-over-year gains continue to be posted across Ontario (around 20-50%), followed by markets in B.C., Quebec and New Brunswick (around 10-30%), and lastly by gains in the Prairie provinces and Newfoundland and Labrador (around 5-15%).

The MLS® HPI provides the best way to gauge price trends because averages are strongly distorted by changes in the mix of sales activity from one month to the next.

The actual (not seasonally adjusted) national average home price was slightly under $696,000 in April 2021, up 41.9% from the same month last year. That said, it is important to remember that the national average price dropped by 10% month-over-month last April as the higher-end of every market effectively shut down for a couple of months. That will serve to stretch these year-over-year comparisons over and above what is actually happening to prices until around June.

By segment: Single-detached remains extremely strong, but earlier signs that condo markets in the large cities were tightening up continue to play out. Condo prices were up 8.5% y/y in April, the strongest pace since mid-2018, and price gains are now running even stronger month-to-month in the biggest cities. We continue to expect these markets to come back stronger than most might think.

By region: It’s as close to wall-to-wall strength that we’ve probably ever seen in this country. Long-dormant markets like Calgary and Edmonton are awake again with prices up roughly 9% y/y; Toronto, Montreal and Vancouver remain strong as usual; some smaller markets (think Halifax, Moncton, Southwestern Ontario) are even stronger than the big cities; and cottage country is booming.

Bottom Line

Headlines will probably flag housing market declines in April, but don’t that fool you…this market is still robust across geography and segment, even if we’ve likely seen peak momentum. Activity will likely remain strong this summer, especially if the COVID restrictions are eased, and people begin to get their second vaccine.


House Hunting Mistakes to Avoid

General Robyn McLean 10 May

Some invaluable tips from my friends at DLC.

By Dominion Lending Centres Apr 7, 2021

Buying a home is one of the largest investments you will ever make! In order to make your home hunting experience the best it can be, there are a 5 house hunting mistakes to avoid and be aware of before you start your journey:


1. Not Getting Pre-Approved

One of the most important aspects of buying a home is the mortgage application and approval process. No matter what type of home you are looking for, you will need a mortgage. One of the biggest mistakes when it comes to the home-buying process is NOT getting pre-approved prior to starting your search. Getting pre-approved determines the actual home price you can afford as it requires submission and verification of your financial history to ensure the most accurate budget to fit your needs.


2. Not Setting or Following a Pre-Determined Budget

Another mistake that people make when home-hunting is not setting, or following, a pre-determined budget. It can be tempting to start looking at the top of your budget, or even slightly over, but when you consider closing costs and the long-term financial responsibility of home ownership, it is best to avoid maxing yourself out. Getting pre-approved will help determine what you can afford, as well as making an appointment with your mortgage broker to determine your financial situation and the best options for you now, and in the future.


3. Not Hiring a Real Estate Agent

Your mortgage broker and your real estate agent are two of the most important members of your homebuying A-Team! In today’s competitive real estate market, it can be very difficult to acquire property without the help of a realtor. One reason is that realtors can provide access to properties that never even make it to the MLS website! They can also gain access to information about homes that may come onto the market, before a listing is even signed. Most importantly though, a realtor understands the ins-and-outs of the home buying process and can tell you how to be successful in your endeavors to purchase a home by guiding you through the process from the first viewing to having your bid accepted.


4. Focusing Too Much on Aesthetics

While we understand that bad interior design can really affect the perception of the home, you don’t want to be blindsided by it. At the end of the day, aesthetics can always be updated! Giving up the perfect price or location or size for a few aesthetic details (such as paint color, flooring, or even outdated appliances or light fixtures) is one of the biggest mistakes people make! Most homes have incredible bones that only need some minor tweaks to become your perfect space.


5. Not Thinking Ahead

What you want and need in a house today, could be very different from what you want and need in a house in the future. It is important to be able to look ahead – are you planning on having children? Are your parents getting older and in need of a retirement space? These are things that are good to take into consideration when buying a new home. Buying a home isn’t a permanent decision as you can always sell your home later on if it doesn’t work for you in the future, but it is almost always easier to plan ahead so you can grow with—and not out of—your home whenever possible.

Weak April Jobs Report Reflects Canadian Lockdown

General Robyn McLean 7 May

The Canadian jobs market review from Dr. Sherry Cooper, Chief Economist at Dominion Lending Centres.

Canada’s Jobs Recovery Impaired by Third-Wave Virus Restrictions
This morning, Statistics Canada released the April 2021 Labour Force Survey showing a major deterioration in the jobs market following the third-wave Covid containment measures. Employment fell by 207,100 (-1.1%) in April, and the unemployment rate rose 0.6 percentage points to 8.1%.Employment declined in both full-time (-129,000; -0.8%) and part-time (-78,000; -2.3%) work. The number of employed people working less than half their usual hours increased by 288,000 (+27.2%).

The number of Canadians working from home grew by 100,000 to 5.1 million.

Total hours worked fell 2.7% in April, driven by declines in educational services, accommodation and food services, and retail trade.

The labour underutilization rate, which captures the full range of available people who want to work, rose 2.3 percentage points to 17.0% in April.

The number of Canadians unemployed for 27 weeks or more–the long-term unemployed–increased to 486,000. This group might well be the most scarred by the pandemic in terms of their job prospects and skill deterioration.

Hardest Hit By Industry SectorIn April, employment fell in several industries directly impacted by public health restrictions, namely retail trade (-84,000); accommodation and food services (-59,000); and information, culture and recreation (-26,000).

Accommodation and food services accounted for more than two-thirds (70.9%) of the overall employment gap (-503,000) compared with February 2020.

Employment increased in public administration (+15,000); professional, scientific and technical services (+15,000); and finance, insurance and real estate (+15,000), three industries where many activities can be performed remotely.

Employment in goods-producing industries was little changed in April.

Fewer people working in Ontario and British Columbia

Following gains over the previous two months, employment in Ontario fell 153,000 (-2.1%) in April.

Employment in British Columbia declined by 43,000 (-1.6%)—the first decrease since substantial employment losses in March and April 2020.

Employment increased in Saskatchewan and New Brunswick, while there was little change in all other provinces.

Bottom Line 

The third wave restrictions cut heavily into Canadian employment in April, mostly in line with expectations. However, in contrast to the mild impact on growth from second-wave restrictions, the latest drop may leave more of a mark on the broader economy, with full-time positions also hit this time. On a less downbeat note, the employment-to-population rate remains a full point above January’s level (at 59.6%). The participation rate is also higher than in the second wave at 64.9% (albeit down a bit from the pre-pandemic trend of 65.5%).

Looking ahead, as in prior waves of virus spread, employment will rebound once the government can ease containment measures. And that light at the end of the tunnel is getting closer, with vaccination rates ramping up. In the meantime, government support programs for those losing work remain in place and help put a floor under household purchasing power.

Canada’s economy remains about half a million jobs shy of pre-pandemic levels. The Canadian dollar rose to 82.36 cents US after the report. The yield on Canada’s 5-year bond yield dipped to 0.894%, down a few ticks from Thursday’s close.

The U.S. Labor Department also released soft jobs data Friday that were even more disappointing. U.S. payrolls increased by just 266,000, versus estimates for a 1 million gain.