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Your Weekly 411: Canada's Housing Affordability Improves | Top U.S. Destinations for Canadian Investors | Canada Outpaces US in Mortgage Payments
Published 25 days agoย โขย 2 min read
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The Weekly 411:
Today we're covering
๐ Housing Affordability Improves Across Canada
๐๐ผ Canadians Outpacing Americans in Mortgage Payments
๐ฝ Top U.S. Destinations for Canadian Real Estate Investors
๐ Winnipeg Experiences Strong Population Growth
๐ฒ Ontario Cottage Prices Are Dipping
๐ค WTF of The Week
Read Time: 4 minutes
๐ Housing Affordability Improves Across Canada
Housing became more affordable across Canada in July, following the Bank of Canada's interest rate cuts from 5% to 4.5% in June and July.โ
This marks the first time affordability has improved since January.
Toronto saw the most significant improvement, with the income required dropping by $5,410 to $208,950.
This was due to lower mortgage rates and a $13,300 drop in average home prices in the Greater Toronto Area.
Vancouver also saw average home prices fall while the income required dropped by $5,020 to $226,680.
Why This Matters: Affordability is expected to improve gradually in most areas. However, increased supply in expensive markets could stimulate more demand, offsetting affordability gains.
๐๐ผ Canadians Outpacing Americans in Mortgage Payments
As of May 2024, only 0.19% of mortgages in Canada were in arrears (payments overdue by 3+ months)
The mortgage delinquency rate in Canada remains very low compared to the United States, where 1.01% of mortgages had payments that were 90+ days overdue in Q2 2023.
Mortgage arrears are a delayed indicator of financial stress. About half of Canadian mortgages have yet to renew at higher interest rates.โ
Smaller and medium-sized Canadian banks are experiencing higher and faster-rising delinquency rates than large "Big Five" banks.โ
Winnipeg's population grew by around 2.5% over the past year, reaching an estimated 836,250 as of July 2024.
Population growth is expected to slow in the coming years but is projected to reach 1 million people by 2031, two years earlier than previous projections.
Why This Matters: The city's strong population growth and rising home prices indicate high housing demand, creating opportunities for real estate investors. However, these rapid price increases make it harder for first-time and lower-income buyers to afford homes. This situation highlights the need for more housing development to accommodate Winnipeg's growing population.
Waterfront property prices in the Lakelands region dropped 23% year-over-year to an average of $809,000 in July.
Non-waterfront property prices in the same area fell 5.3% to $650,000.
Total waterfront sales in July decreased by 22.9% compared to the previous year.
Sales volumes are below historical averages:
Non-waterfront sales: 26.3% below the 5-year average, 30.7% below the 10-year average
Waterfront sales: 36.7% below the 5-year average, 42.9% below the 10-year average
Why This Matters: Significant changes in cottage prices can reflect broader economic trends and consumer behavior. The steep decline in recreational property values may indicate shifting priorities or financial pressures among potential buyers.
This house in London, Ontario (43 Ravine Ridge Way, London) was sold for $1.7M in Apr 2023 and went for $1.05M last month... That's a whopping $650k loss in one year. ๐คฏ
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