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The Evolution of the Canadian Mortgage Market: A Brief History – Part 1
In the first installment of our two-part series, we explore the evolving roles of key market players and the legislative changes that paved the way for chartered banks to dominate the Canadian mortgage landscape. The evolution of the Canadian mortgage market is far more nuanced than the simplified portrayal presented in a recent speech by…
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Is Powell Signalling a Pause?
In a recent speech, Federal Reserve Chair Jerome Powell commented that, “the economy is not sending any signals that we need to be in a hurry to lower rates.” However, the market didn’t react much to his comments, since fixed income investors had already determined that, given the strength of the economy and recent inflation…
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Are We Tinkering Enough with the Mortgage Market?
In a recent speech, the Bank of Canada’s Senior Deputy Governor Carolyn Rogers cautioned about “tinkering too much with the mortgage market.” My concern is that we are not tinkering enough. Rogers pointed out that, based on current mortgage rates and average mortgage size, a borrower stretching their amortization from 25 to 30 years could…
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Mortgage Rate Outlook: Variable Rates Likely to Drop, Fixed Rates Remain Uncertain
Canadian employment rose by 14,500 in October, with the unemployment rate holding steady at 6.5 per cent. Meanwhile, the participation rate continued to decline, falling to 88.2 per cent from a record high of 89 per cent just over a year ago. The employment-to-population ratio also dropped to 60.7 per cent—the lowest level in nearly…
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Zero-Down Payment Mortgages: Can We Solve Two Problems With One Program?
Recent data from Statistics Canada reveals a significant gap in net worth between retirees who own their homes and those who don’t, highlighting the critical role of homeownership in building Canadians’ financial wellbeing. Yet, many Canadians face steep challenges in purchasing their first home, with a large number liquidity-constrained and unable to save enough for…
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Monetary Policy: What’s the Next Move?
While both the Fed and the Bank of Canada are easing rates, the pace of cuts is expected to vary. The US is on a slower path to lowering interest rates due to several factors. The US economy has been less sensitive to rate hikes as many consumers and firms locked in low interest rates…
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Examining the Conservatives’ Plan to Eliminate the GST on New Homes Under $1 Million
The federal Conservatives recently announced a plan to abolish federal sales tax on new homes under $1 million if elected, with the goal of encouraging the provinces to follow suit. A report from the Canadian Centre for Economic Analysis (CANCEA) found that in Ontario, over 31 per cent of a home’s purchase price is tied…
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