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Bank of Canada maintains overnight rate target at 1 per cent

by Manoj Kumar Arora

The Bank of Canada today announced that it is maintaining its target for the overnight rate at 1 per cent. The Bank Rate is correspondingly 1 1/4 per cent and the deposit rate is 3/4 per cent.

Inflation has risen by more than expected. The increase in inflation over the past year is largely due to the temporary effects of a lower Canadian dollar and some sector-specific factors, notably telecommunications and meat prices. Underlying inflation has edged up but remains below 2 per cent.

The U.S. economy has clearly strengthened, particularly business investment, which has benefitted Canada’s exports. Growth in the rest of the world, in contrast, continues to disappoint, leading authorities in some regions to deploy further policy stimulus. Oil prices have continued to fall, due to both supply and demand developments. In this context, global financial conditions have eased further.

Canada's economy is showing signs of a broadening recovery. Stronger exports are beginning to be reflected in increased business investment and employment. This suggests that the hoped-for sequence of rebuilding that will lead to balanced and self-sustaining growth may finally have begun. However, the lower profile for oil and certain other commodity prices will weigh on the Canadian economy.

READ THE BANK OF CANADA'S PRESS RELEASE

Greater Toronto Area Real Estate Resale Homes prices increase by 7.4% in November 2014

TORONTO, December 4, 2014 - Toronto Real Estate Board President Paul Etherington announced that Greater Toronto REALTORS® reported 6,519 residential transactions through the TorontoMLS system in November 2014. This result was up by 2.6 per cent compared to 6,354 sales reported in November 2013. Through the first 11 months of 2014, total sales amounted to 88,462 - up 6.6 per cent compared to the same period in 2013.

While the trend of year-over-year sales growth continued, the supply of listings remained constrained, with active listings at the end of November down in comparison to last year. "Even with a constrained supply of homes for sale in many parts of the Greater Toronto Area, Buyers continued to get deals done last month. Households remain upbeat about home ownership because monthly Mortgage payments
remain affordable relative to accepted lending standards. This is coupled with the fact that housing has proven to be a quality long-term investment," stated Mr. Etherington.

The average Selling price for November transactions was up by 7.4 per cent year-over-year to $577,936. The year-to-date average price was up by 8.4 per cent to $567,198. The MLS(R) Home Price Index Composite Benchmark price for November was up by 7.7 per cent compared to a year earlier.

"The robust average price growth experienced throughout 2014 has been fundamentally sound, with demand high relative to supply. Strong competition between Buyers has exerted upward pressure on Selling prices. Barring a substantial shift in the relationship between sales and listings in the GTA, price growth is expected to continue through 2015," said Jason Mercer, TREB's Director of Market Analysis.

Read the Complete Market Watch Report Here

         

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Photo of Manoj Kumar Arora, Broker of Record Real Estate
Manoj Kumar Arora, Broker of Record
Ace Team Realty Inc., Brokerage
77 City Centre Drive, East Tower, Suite 501
Mississauga ON L5B 1M5
905-488-3101
1-888-355-3155
Fax: 1-888-443-3155

Contact Information

Photo of Manoj Kumar Arora, Broker of Record Real Estate
Manoj Kumar Arora, Broker of Record
Ace Team Realty Inc., Brokerage
77 City Centre Drive, East Tower, Suite 501
Mississauga ON L5B 1M5
905-488-3101
1-888-355-3155
Fax: 1-888-443-3155