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.
Check the fine print behind discounted no-frills mortgages
March 1 2016 Posted by Jennifer Gaudet
Check the fine print behind discounted no-frills mortgages
Spring market 2012 is heating up with some low-rate no-frills mortgage promotions. They are certainly attention getting but these mortgages often come with restrictions that can cost you in the long run. That's why it's important to check the fine print:
- A fully closed mortgagemeans you're not leaving the lender unless you sell your house, so your options are limited and you have no negotiating power if your needs change in the next 5 years.
- Low or no prepayments gives you no or limited ability to chip away at your principal to reduce your overall cost.
- Maximum 25-year amortization can take away important flexibility like taking a 30-year amortization but setting your payments higher using a 25-year or lower amortization, which keeps open the possibility of reducing payments later should you need breathing room for an emergency situation or special need.
Who really knows what life might be like a few years down the road? The lack of flexibility associated with a no-frills mortgage could end up causing you some major headaches.
Talk to us to review all of your options. We have access to many low-rate full-feature mortgages that provide more flexibility and could save you thousands. Rate is not the one and only factor in choosing a mortgage!
Jennifer Gaudet
Associate Mortgage Broker - Military Mortgage Specialist
- 902-824-2906
- jennifer@jennifergaudet.ca
- Licence # 2024-3000814
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