As a Licensed Mortgage Professional, I work with clients from all walks of life and employment. My more than 32 years of real estate and real estate financing experience helps facilitate the sound solutions that my clients rely on for any and all of their mortgage financing needs. Having access to many funding sources that are typically unavailable to my clients, I am able to source mortgages that best fit their needs, not the bank’s. I strongly focus on educating my clients in all facets of their mortgage, ensuring that the mortgage is treated as an investment with a return (ROI) rather than simply as a utility. I began my Real Estate career in 1986 and became a licensed mortgage broker in 2000. I hold the designation as a Canadian Reverse Mortgage Professional.
Higher interest rates and household debt: Cause for recession?
From National Bank of Canada
There is a great deal of concern regarding the vulnerability of Canadian households not only to inflation shock but also to sharp interest rate hikes.
For heavily indebted households, the bill could prove hefty. Those that contracted mortgages 4.Sx their gross income could see their monthly payments increase by $187 to $281 from 2022 to 2024 and absorb as much as 2.6% to 4.0% of their net income.
At the macroeconomic level, however, the story is far different given the high proportion of properties without mortgages. By our calculations, the payment shock related to servicing the accumulated debt will represent 0.65% of disposable income over the next three years. The amount is significant but manageable in that it alone will not suffice to pull the economy into a recession.
Prices continue to lose momentum in June
With the decrease in resale market transactions and the increase in interest rates, property price growth moderated for a third consecutive month, but still remained solid in June at 1.0% after adjusting for seasonal effects. Using the seasonally adjusted unsmoothed index, which is more sensitive to market fluctuations, the moderation is even more pronounced, with property prices essentially flat in May and June. While the Bank of Canada has indicated that it will continue to raise its policy rate and that transactions in the real estate market should continue to decline, we anticipate that the composite index should decrease by 10% by the end of 2023. The price declines have already begun to spread across the country. In fact, for all 32 markets where the seasonally adjusted unsmoothed index was available in June, 58% experienced a decline during the month, compared to 34% in May and only 16% in January. We have to go back to May 2020, at the very beginning of the pandemic when uncertainty was at its peak, to find such a large proportion of markets in decline.