May 2021 Detailed Market Report

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Each Executive Summary Report is for a specific TRREB zone combination and includes a map of the included zones and a 1 page summary for each property type (detached, semi-detached, townhomes, condos)
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The Information / statistics you can find in each Executive Summary Report include:

• Data comparing the – 1, 3, 5 and 10 year sales averages.

• Stats categories – Sales, New Listings, Active Listings, Average Price, Months of Inventory (MOI), Sales to New Listing Ratio (SNLR)

Mortgage Updates

OSFI Changes Now In Effect.

OSFI (the federal banking regulator) has made changes to the mortgage qualification guidelines as of June 1st 2021. 

What’s changed?  You qualify for your mortgage based on a “Stress Test” rate vs. your actual mortgage rate.  The “Stress Test” rate is calculated as the greater of your actual mortgage rate +2.00% OR the Benchmark Rate,  OSFI has increased the Benchmark Rate to 5.25% effective June 1^st (will be called the “floor rate” going forward).  Answers to common questions we’ve received:

How much did the rate change? OSFI increased the Benchmark Rate from 4.79% to 5.25% effective June 1, 2021.  This will also decouple the Benchmark Rate from the Bank’s 5-year fixed posted rates creating a new “floor rate”.

Impact on Max Qualification? A Benchmark Rate increase from 4.79% to 5.25% will reduce a person’s maximum qualification by approx. 4% (i.e., reduction of approx.. $40,000 purchasing power per $1,000,000 of purchase price).

What is our opinion? We like the fundamentals.  By separating the Benchmark rate from the Big Bank’s posted rate (which can fluctuate regularly and is also impacted by bank business decisions), it will create more stability and provide OSFI/Government with a powerful housing market heating/cooling tool going forward.

Where can you find more information?  To review OSFI’s press release please [Click Here]

Who will this impact?  This change is aimed at conventional mortgages.  What does that mean?  For purchases, a conventional mortgage is (1) any purchase $1,000,000+  OR  (2) any purchase with 20%+ down payment.  The change will also impact anyone looking to refinance their existing home.

Who will this NOT impact?  For now, this change will not impact those buying for less than $1,000,000 with less than a 20% down payment (High Ratio buyers).  As this is a federally imposed change, this may not impact provincially regulated lenders (i.e., credit unions).  As a mortgage brokerage, we have access to over 20 banks, credit unions, and mono-line lenders and always look for the best fit solution depending on a clients’ goals, priorities, and circumstances

How to navigate an overwhelmed (or soon to be overwhelmed) system:  With Q1/2021 transaction volume almost double from what we had in Q1/2020, Q1/2019, and Q1/2018 it is putting a strain on all facets of the real estate market including inspectors, appraisers, lenders, and lawyers as they work towards the closing date and also handle all new sales coming in.  While the system is stretched, there are some tips you can keep in mind to help make sure your purchase goes as smoothly as possible:

Closing date tip: Real Estate Lawyers usually have the most closings on the first and the last day of the month.  Try to avoid an end-of-the-month closing date, and ideally try to close mid-week vs. a Friday.

Market Report Downloads

Executive Summary (5 Page Report) On the go? The Exec Summary Format  provides 1yr/3yr/5yr/10yr comparisons across all key TRREB metrics in a “one-page-per-property” type layout.  Details for the current month, year-to-date, and rolling 12-month totals and historical comparisons are also included.

NEW! Power Pack – 17 Page Report The latest (and we think greatest!) addition to the collection.  This report includes everything from the Executive Summary Tables, plus some amazing charts/visuals for all major metrics including: sales, new listings, active listings, sales-to-new-listings ratio, months of inventory, average price, and sale price to list price.

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