Latest in Mortgage News: Toronto Home Prices Set July Record
The rebound for Toronto home prices continued in July, with the average selling price reaching a record $943,710.
That’s a 16.9% increase compared to a year earlier, according to the Toronto Regional Real Estate Board (TRREB). Home sales in the Greater Toronto Area were up 29.5% in July compared to a year earlier, and up 49.5% vs. June 2020.
“Normally we would see sales dip in July relative to June as more households take vacation, especially with children out of school,” said TRREB president Lisa Patel. “This year, however, was different with pent-up demand from the COVID-19-related lull in April and May being satisfied in the summer, as economic recovery takes firmer hold…”
TRREB noted that competition among buyers picked up during the month, which fuelled the acceleration in price growth.
In Vancouver, home prices rose 4.5% year-over-year to $1,031,400 as more buyers took to the market, encouraged by low interest rates, according to the Greater Vancouver Real Estate Board.
Home sales were up 28% compared to June, as COVID restrictions eased and more buyers took to the market.
“We’re seeing the results today of pent-up activity, from both homebuyers and sellers, that had been accumulating in our market throughout the year,” said Colette Gerber, chairwoman of the GVREAB.
10-Year Rates Reach Record Lows
There’s typically not too much demand for decade-long mortgages, but with rates falling as low as 2.59%, they’re starting to attract some attention.
Last week, Tangerine Financial unveiled a 2.59% 10-year fixed rate for purchases, transfers and refinances.
Compare that to the near 4.00% 10-year rates available just a year and a half ago.
Granted, there are now many other fixed-rate terms available for under 2.00%. But for those who may be in the home-stretch of paying off their mortgage or who value rate stability above all else, today’s 10-year rates are decent value.
GTA Condo Sales Plummet in Q2
New condo sales in the Greater Toronto Area (GTA) fell 85% in the second quarter of 2020 compared to the previous year, reports Urbanation Inc.
“Only six projects and 1,176 units were launched for pre-sale during the quarter, which compares to 40 projects and 11,415 units launched in Q2-2019,” the real estate consulting firm noted in its Condominium Market Survey.
On the other hand, Urbanation notes that average selling prices for units in actively marketed new condo projects in development across the GTA averaged a record-high $867 per square foot, edging up from $864 psf in Q1 2020 and rising 8% year-over-year, reflecting “broad-based increases in selling prices.”
“The GTA condo market showed resiliency in the second quarter, albeit with much lower-than-normal activity,” noted Shaun Hildebrand, President of Urbanation. “More telling will be the second half of 2020, which will see supply pick up from growth in new launches and the nearly 14,000 units that are scheduled for completion in the next six months.”
What You Need to Know About Spousal Buyout
Separation or divorce aren’t things people ever plan for. But the end of a relationship can have a significant impact on planning surrounding your residence—most often your largest asset.
But the end of a relationship doesn’t necessarily mean you’ll be forced to sell your home, notes April Dunn of Red Door Mortgage Group.
“There are mortgage products available that can allow you to buy out the other party while enabling you to stay in your home,” she wrote, adding lenders will require a finalized separation or divorce agreement.
“The mortgage funds can only be used to buyout the other party’s equity in the home unless it is clearly laid out in the separation agreement that some joint debts need to be paid out to a maximum of 95% of the value of the property,” she adds.
Dunn recommends anyone interested in exploring this topic further contact a mortgage broker who will be able to guide them through the process and available options.