TD Economics Report Feb 8, 2017

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TD Economics brought to you by Dina Ignjatovic, Economist

 

Data Release: Housing starts kick off the year on strong footing

 

  • Canadian housing starts kicked off the year on a strong note, with homebuilders breaking ground on 207k units (annualized) in January.  This extends December's sharp gain, and pushes the 6-month moving average up just shy of the 200k unit mark.

 

  • The strength in January stemmed from the multi-family sector, which was up 4.2% following a 14% gain in December.  Meanwhile, single family construction was down 4.6% on the month, reversing some of December's gains.

 

  • Regionally, Ontario remained the key driver of growth, with starts up by a whopping 25% in January.  Homebuilding in the Atlantic Provinces was also up during the month while the remaining regions recorded declines.  B.C. experienced the largest pullback, as home starts slid 33% from the month prior.

 

Key Implications

 

  • Overall, housing starts have been hovering around the 200k mark annualized (on a trend basis) for the last six quarters, or just slightly above the current rate of household formation.  However, homebuilding construction should begin to slow over the course of the year, consistent with a cooling in overall housing market activity.

 

  • Still, the recent strength in multi-unit projects could have further room to run given the surge in building permit approvals seen over the second half of last year. This could be partly offset by single-family construction, which is already at relatively lofty levels.

 

  • The regional story will continue to reverberate across the housing markets, with central Canada leading the way, while B.C. and the oil-rich provinces lagging behind.

 

 

Smooth move! Nine tips to survive the buy/sell
 March 1 2016     Posted by Jennifer Gaudet

Smooth move! Nine tips to survive the buy/sell

So there’s a move in your future. It can be a stressful juggling act: selling one home, buying another. We deal with this all the time, and have some tips for making a smooth move through these two transactions:

  1. Dig up your mortgage papers. You’ll want to begin with the facts on your current mortgage. Find out if it’s portable. If so, you may want to carry your mortgage to your new property: saving you discharge penalties. Are there any conditions to port the mortgage, and if you need more funds, can you blend the rate?
  2. Ask about penalties. If you want to pay out your mortgage, what is the penalty? Sometimes it’s worth paying a penalty for a much lower overall interest rate. I can run the numbers for you.
  3. Find out what your home is worth. Get a market evaluation of your home from your realtor. Understand the costs involved in selling; you’ll want to know how much you will have available to purchase your new home.
  4. Get a mortgage pre-approval for your new home. Know how much you can afford.
  5. Ready to shop.  With your realtor, start the business of buying and selling.
  6. Plan your downpayment. If your downpayment funds are coming from the sale of your current home, you’ll need to provide a current mortgage statement and a copy of a fully-executed sale agreement.
  7. Qualify for your mortgage. This will be similar to getting approved the first time, although your employment, credit situation, or lender guidelines may have changed, which means qualifying could be different. I will advise you accordingly.  
  8. Bridging any gap. Sometimes the sale of your old house closes after you take possession of the new one. Your lender may be able to provide a short-term bridge loan.
  9. Make a smooth move. And celebrate this important milestone!

I can help you with all of the mortgage details for your new home!

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Jennifer Gaudet
Associate Mortgage Broker - Military Mortgage Specialist

Jennifer Gaudet

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