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Housing Affordability Worsened In Q2, But Should Improve Due To Falling Prices.

Housing affordability in Canada reached its worst level in 41 years in the second quarter, shortly after home prices peaked and as interest mortgage rates started to rise.

That’s according to National Bank of Canada’s latest Housing Affordability Monitor, which recorded its sixth consecutive quarterly decline in housing affordability.

But with home prices down significantly in certain markets, and a stabilizing of fixed mortgage rate increases, affordability should begin to improve, the report’s authors noted.

“We are noticing a considerable slowdown on the resale market, with home sales now 12.8% below their 10-year average,” the report reads, adding that’s translating into a decline in home prices. “This development, combined with a stabilization of the benchmark 5-year mortgage rate, should improve affordability before the year-end.”

While rapidly rising home prices were largely responsible for the deterioration in housing affordability over the past year, an increase in mortgage rates was the key factor in the second quarter.

NBC noted that the 5-year benchmark rate used to calculate its affordability metrics rose 123 basis points in Q2, the largest quarterly change since 1994.

“This increase has propelled the benchmark mortgage rate to its highest level since 2011,” the report noted.

Source: https://www.canadianmortgagetrends.com/2022/08/housing-affordability-worsened-in-q2-but-should-improve-due-to-falling-prices/

Steve Huebl·Real Estate·August 22, 2022

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Rent Prices On The Rise Again.

After taking a breather in June, rent prices continued to trend upward in July, rising 2.6% in the past month.

The average national rent price is now $1,934, up 10.4% compared to a year ago, according to data from Rentals.ca.

For single-family homes, the monthly rent was $3,043, a 14.1% year-over-year increase. Rental apartments, which make up the majority of listings on Rentals.ca, averaged $1,743, a 7.7% increase since last year.

At a provincial level, British Columbia once again had the highest average rental rate, at $2,590 for all property types. That’s up 0.6% from a month ago and a 19% jump since last July.

Next up was Ontario, with an average rent of $2,332, up 3.1% month-over-month and 15.2% since last year.

Of the seven provinces’ surveys, Manitoba was the only one that saw rent prices essentially unchanged at $1,377.

Source: https://www.canadianmortgagetrends.com/2022/08/rent-prices-on-the-rise-again-in-july/

Steve Huebl·Real Estate·August 17, 2022

Contact Me Today: 📞 647-528-7100
Or Email: [email protected]