Toronto Mortgage Rates

August MLS sales totaled 7,569 houses and condominiums in all the districts. This sales number was almost 14% above the average for the month over the last 12 years and up 18% from one year ago. Remember that last summer we had the Federal Government reduce the amortization period down to 25-years from 30 which eliminated a lot of first-time buyers from the marketplace.


Toronto Mortgage Rates Week in Review for the Week Endings

Condo townhouses and high-rise suites increased their share of the market slightly to 31.8% with 2,404 units changing hands.

The August average building sale price for all GTA homes came in at $503,094– up 5% from 2012. We’ll comment more on that later.

East of Yonge and south of Bloor in the C08 downtown TREB district, the condo sales price average was $398,000 while west of Yonge in C01 the average was $444,000. More condo market details will be coming in just a few minutes.

Watch our Toronto Real Estate Market Report and get the ‘real’ statistics on what’s happening in Toronto house and condo markets.

Pre-construction Assignment Condos

Two weeks into the new year, the consensus is that the Fed quantitative easing program has been a dud. Toronto current mortgage rates, Toronto FHA mortgage rates. The intention of the program was to pump new money into the economy by buying treasuries and other bonds, as a way to drive interest rates lower and slowly re-inflate asset prices. The Fed’s big worry has been the risk of deflation. The concept here was to battle deflation by adding a little positive inflation into the mix. This concept has worked before when the Fed ran a similar program last year, but this time as the Fed rose up for what they considered a slam dunk, the markets slapped the ball back in their face.

Over the last few months, there have been signs that the economy is improving. It is still not clear that this is sustainable on the condo market, but it is enough to refocus thinking from the fear of falling to the fear of over-heating and running up our debt and bankrupting the country. Instead of achieving their stated goal, the main effect of QE2 so far has been to run interest rates up, prop up the stock market and pressure the dollar which means oil prices have spiked higher. We still have some major problems associated with deflation, the housing market is still a mess and unemployment is high and not likely to get better for years. The Fed still may be proved right about deflation in the long run, but the money machine they control is more complex and the law of unintended consequences is now in play. From street level this looks a lot like stagflation, where the economy is soft but prices for gas and groceries are going up. This round of QE2 will run its course, but the Fed will need to go back to the drawing board to come up with a new way to achieve its goals. Barring a sudden downdraft, there will not be the third round.

Check The Condo Market Report before Selling your home to buy a condo

Reports released last week showed some doubt about the strength of the new recovery. Retail sales in December came in much better than the last two years, but a lot lower than what was expected, an increase of .4%. The expectations were that consumers were ready to get back to old habits and spend big on Christmas, but instead, much of the spending was again focused on big bargains and discount shopping, which does not look good for retailers bottom lines. The CPI (consumer Price Index), the biggest measure of consumer inflation, came in with an increase of ,5% for the month, a hot reading. But when oil (mostly) and food costs which tend to be more volatile, were backed out, the core reading was at plus .1%, showing overall inflation is under control. The University of Michigan consumer confidence index slipped lower, showing that people are still worried.

The reaction in the interest rate markets to all this news has been one of consolidation. Rates have improved some, but the question now is whether this is a pause before heading higher again, or are we about to drop back closer to the levels rates were at before the Fed announced their plans for easing. At this point there is a lot of uncertainty in the market and rates could still go in either direction. Reports released this week will focus on the strength of the housing market, and the markets are still watching the situation in Europe where the strongest economies are holding up the weaker ones so the Euro won’t crack. Even with the run-up in rates over the last few months, mortgage rates are still near historic lows. That’s one of the reasons – investing in construction projects, like Express 2 Condos is very liquid with the lower rates. If you are thinking about buying a home this year, especially if you plan to be ready for the Spring market, this is the time to be pre-approved for a mortgage. If there is anyway I can help, give me a call.

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