Welcome to the April issue of my monthly newsletter!

Spring has sprung for most Canadians (sorry about your luck Alberta) and along with the ever-present trusted mortgage content, this month I have some gardening inspo for anyone that wants to flex their green thumb this year. Enjoy!

Variable-Rate Mortgages: What You Should Know
Shakespeare might have thought ‘to be or not to be’ was the ultimate question, but he wasn’t living in 2025 trying to minimize bank fees and interest charges while maximizing financial returns—and having to pay $9 for a clamshell of raspberries. This month, we’re tackling a modern dilemma: ‘Should I get a variable or fixed rate on my mortgage?’ Not as poetic, but way more practical. Let’s dive in.

Understanding the Basics: Every mortgage payment has two components: principal and interest. Your choice between a fixed or variable mortgage impacts how these are structured over time.

Variable Rate Mortgages: Variable rate mortgages come in two main forms:
• Fixed Payment Variable Mortgage – You have a set monthly payment, but the portion that goes toward principal vs. interest fluctuates. When rates go up, more of your payment goes toward interest, slowing down how quickly you pay off your mortgage. When rates go down, more goes toward the principal, helping you pay off your loan faster.

• Adjustable Payment Variable Mortgage – The total mortgage payment fluctuates based on interest rate changes, ensuring the mortgage is paid off within the original amortization schedule. The portion of your payment allocated to interest and principal will shift as rates change.

Variable mortgages introduce an element of unpredictability, which some borrowers are comfortable with, while others prefer the security of knowing exactly what their payments will be.

Fixed Rate Mortgages: A fixed-rate mortgage means your interest rate and monthly payments remain the same throughout your term. This stability can be crucial for those who prioritize predictability in budgeting, mental well-being, or long-term financial planning. If the idea of fluctuating payments makes you uneasy, or if you want to avoid worrying about interest rate changes, a fixed-rate mortgage could be the right choice.

The Interest Rate Factor: The Bank of Canada (BoC) sets the overnight lending rate, which influences the Prime rate set by banks. Variable mortgage rates are typically based on Prime ± a lender-specific adjustment. There are eight key BoC announcements each year that can result in rate changes (or no changes at all). You’ve probably seen me cover these on social media (if not, I’d love for you to follow along!).

During the pandemic, the BoC lowered rates to 0.25% to stimulate borrowing. Rates began increasing in 2022 due to inflation, reaching 5% by mid-2023 before the BoC started cutting them in 2024. As of March 12, 2025, we’re at 2.75%, with six more rate decisions coming this year.

Risks: There are risks with both variable and fixed rates for your mortgage. With a fixed rate, the risk is that if rates drop, you will have a higher payment than what is available on the market. You’d also likely incur a penalty to break the fixed rate term to capitalise on any decreases. With a variable rate, the risk is that changing rates could increase the amortization of your mortgage. We also discussed the risk of Bank of Canada announcements indirectly changing your rate and therefore payment, impacting your budget and cash flow. And one final potential risk is if rates go up enough, it may trigger the need for a lump sum payment to your lender.

2025: What’s Next? The current rate is still above the target 2%, meaning there is room for potential decreases. However, nothing is guaranteed. Rates could hold steady or, in rare cases, even increase due to external factors like inflation spikes or international economic shifts.

Impact on Your Mortgage: If you have a variable mortgage, your rate is based on your lender’s Prime rate, which is influenced by the BoC policy rate. Your mortgage rate is typically Prime ± a lender adjustment. If the Prime rate is 6% and your lender offers Prime – 0.50%, your mortgage rate would be 5.50%.
• With a fixed payment variable mortgage, more of your payment goes toward principal.
• With an adjustable payment variable mortgage, your monthly payment decreases.

If you have a fixed-rate mortgage, your rate and payments remain unchanged during your term. This stability is why many borrowers prefer fixed rates, even if they sometimes come with slightly higher initial rates. Fixed rates are influenced by bond market trends rather than the Bank of Canada’s policy rate directly.
Which One is Right for You? There is no universal right answer—only the best choice for your financial situation, risk tolerance, and future plans. As your mortgage professional, I’d love to walk through your mortgage with you and discuss:
• The pros and cons of fixed vs. variable for your specific needs.
• How to budget for worst-case scenarios.
• Whether breaking your current mortgage to switch makes sense.
• Economic implications of switching between a variable and fixed rate.
• If adjustments at renewal would benefit you?

Send me an email, text, or call anytime! I’m here to provide guidance, not pressure. Let’s find the best mortgage strategy for you!

Gardening 101: Your Spring Gardening Checklist
If you want to maximize returns on your gardening efforts, we’ve got 3 strategies to take you from garden simp to master plant manipulator.

Strategy 1: Better late than early
Seeds do best when they have an uninterrupted growth phase.
So rather than having your plants stall out in a frost, wait 2 weeks (you can do it!) after your initial instinct to plant. It may seem like it’s too late, but the plants will put it into overdrive and make it work. If you’re in doubt and want to test this theory out, plant half the seeds early, and half the seeds 2 weeks later, and see which does better by the end of the growing season. If you’re new to gardening, you might not have a clue if your tomatoes should go in March 1 or July 1, and that’s totally okay too. The Farmer’s Almanac comes to your rescue with their 2025 updated guideline of when to plant based on your postal code. Click here for details.

Strategy 2: Layout matters
Think measure once, cut twice – but for your garden. First up, arrange the tallest plants on the north side of your garden, and the shortest plants on the south side. This will make sure both your little gem lettuces and the jolly green giant snap peas both get enough sunlight. Second, do your research on how much space each plant needs to thrive so you can plan enough real estate for everyone. This website will help you with both these action items for 71 different vegetables. And don’t be afraid to actually measure out your garden. Putting string dividers in there will help you achieve the perfect layout.

Strategy 3: Weed prevention
Prevention is the best way to avoid destroying your back weeding all spring and summer. This is a bit boujee, but if you don’t have raised garden beds it might just be for you. Putting down a layer of cardboard, then adding a 5-10cms of mulch on top, makes sure the weeds stay underneath while the worms and other goodies stay on top, working hard for your soil and plants. If cardboarding your garden isn’t in the cards, just make sure that there is no open soil. If you can see it, so can a weed! Covering the dirt with a layer of mulch (doesn’t have to be fancy mulch, it can just be lawn clippings, sawdust, and the fall leaves you never bothered to rake up and put out on the curb) will prevent most weeds from having the opportunity to grow in the first place.

Hopefully these tips make you the CEO of your own garden in 2025. If you try something new based on what you read here, send me a pic or a note. I’d love to know what’s working for you and share your advice on my socials!

Economic Insights from Dr. Sherry Cooper
Since Donald Trump took office, all bets are off on the Canadian economic outlook. Most people expected more substantial growth and lower inflation as we moved into 2025. Trump’s tariffs, deregulation, attempts at massive reductions in the federal government bureaucracy and geopolitical machinations have changed everything.

VUCA is the name of the game. An acronym used initially by the US Armed Forces, VUCA stands for volatility, uncertainty, complexity, and ambiguity, and it describes the current situation to a tee. Canadian consumer confidence has fallen to its lowest level in decades. Stock markets have plummeted, the currencies are volatile, interest rates have fallen, and no one knows precisely how this will unfold.

On April 2, the US said it would impose reciprocal tariffs on countries with levies on US goods or that favour domestic producers in some way. Moreover, the president has chosen to go after Canada particularly damagingly. We are the number one supplier of steel and aluminum to the US and are now confronted with 25% tariffs. Inevitably, the economy will slow, layoffs will rise, and tariffs will be passed on to the consumer. Whether this will be a one-shot price hike or spillover into second-order effects is uncertain.

Fed Chairman Powell suggested today that inflation from tariffs will likely be transitory—suggesting that price hikes will trigger higher wage demands. Stagflation is an undesirable possibility.

Central banks do not have the tools to deal with tariff-induced stagflation. Higher interest rates might reduce inflation, but slow economic activity, and lower rates might increase price pressures. China is expected to impose retaliatory tariffs on Canadian canola oil, pork and seafood. The tariffs are push-back against Canada for imposing a 100% levy on electric cars from China and 25% on steel and aluminum.

The US is inserting disruption and disorder into a thriving trading partnership between Canada, Mexico and the US. As Jay Powell says, “It’s hard to say how this is going to work out.”
We are expecting slower growth to be dominant, brought on by VUCA. Shorter-term interest rates will fall. That, combined with more housing supply and lower home prices, should spur housing activity and bring buyers off the sidelines as we move into the Spring selling season.

If you’d like to be added to my distribution list, send an email to mike.bohte@dominionlending.ca

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Welcome to the March issue of my monthly newsletter!

As the Spring season approaches, I have some updates for how to prepare your finances for the coming homebuying season. Plus, check out my fraud awareness tips as March is Fraud Awareness Month!

Spring Forward: Preparing Your Finances for the Home-Buying Season
Spring is one of the busiest seasons in the real estate market, with buyers eager to find their dream home before summer.
If you’re planning to purchase a home in Spring 2025, now is the time to get your finances in order.
Being financially prepared can help you secure a mortgage with favorable terms and make your home-buying journey smoother. Here’s how to get ready:

1. Check and Strengthen Your Credit Score
Your credit score is one of the most important factors in mortgage approval, influencing both your eligibility and the interest rate you’ll receive. A higher score can save you thousands over the life of your mortgage, so it’s worth taking the time to improve it.

• Start by checking your credit report for errors, and if you spot any inaccuracies, dispute them immediately.
• Pay down outstanding debts to lower your credit utilization ratio, which plays a big role in your score.
• Avoid opening new lines of credit in the months leading up to your mortgage application, as this can temporarily lower your score.
By reaching out to me, I can help preserve your credit score as they will pull your credit report once to shop your application. Note: Multiple credit checks in a short period can lower your credit score.

2. Build a Strong Down Payment
The more you can put down up front, the better. A larger down payment can reduce your monthly mortgage costs, give you access to better loan terms, and, in some cases, eliminate the need for mortgage insurance.

• Set a savings goal based on home prices in your target area so you have a clear plan.
• Explore first-time homebuyer programs that offer down payment assistance—there are plenty of government and lender-based options.
• Make saving a habit by automating deposits into a dedicated home savings account.
Avoid moving your money around to multiple accounts prior to applying for your mortgage. Lenders require a 90-day history of your down payment and a history of moving your money around can make this more difficult to easily verify your down payment.

3. Reduce Your Debt-to-Income Ratio (DTI)
Lenders use your debt-to-income ratio (DTI), aka GDS/TDS, to assess how comfortably you can handle a mortgage payment on top of your existing obligations. A lower DTI signals financial stability, improves your chances of loan approval and can expand your borrowing power.

• Work on paying off high-interest debts or debts with high monthly payments, like credit cards and personal loans, to free up more of your income.
• Hold off on making large purchases or taking on new loans, such as car financing, before applying for a mortgage.
If possible, look for ways to increase your income—whether through a raise, side gig, or freelance work—to strengthen your financial standing. Note self employed income or part time non-guaranteed hours employment generally require a 2-year history.

4. Get Pre-Approved for a Mortgage
A mortgage pre-approval is a game-changer in a competitive market. It gives you a clear budget, shows sellers that you’re a serious buyer, and can even speed up the closing process.

• Start gathering essential documents like tax returns, pay stubs, and bank statements—lenders and myself will need these to assess your financial health.
• Reach out to me today for information to help you compare mortgage rates and terms, ensuring you get the best deal.
• Take time to discuss your mortgage options with me, from fixed to variable rates, different term lengths, or special programs available to you.
Download my mobile mortgage app.

5. Budget for Additional Costs
The home price isn’t the only expense you’ll need to plan for. Homeownership comes with extra costs that can catch buyers off guard if they’re not prepared.

• Closing costs typically range from 1.5% to 4% of the home’s purchase price, covering legal fees, land transfer taxes, and more. This is money you need on top of your down payment
• Property taxes, Condo fees and homeowners’ insurance can add to your monthly expenses—make sure to factor them into your budget.
Set aside a fund for home maintenance and emergency repairs to avoid financial strain when unexpected expenses arise.

6. Research the Housing Market
Spring is a competitive time to buy, so being well-informed about the market can give you an edge.

• Keep an eye on housing prices in your preferred neighborhoods to understand trends and pricing expectations.
• Stay updated on current interest rates, as they directly impact affordability and your monthly payments.
Work with a trusted real estate agent who can help you navigate bidding wars, negotiate offers, and find the right home for your needs.

7. Consider Locking in an Interest Rate
Interest rates can fluctuate, and even a small increase can affect your monthly payments. If rates are expected to rise, securing a lower rate in advance could save you money over time.

• Ask me about rate lock options and how long they’re valid for. Rate holds on average are valid for 120 days before they expire and a new rate hold period is requested
• Compare fixed and variable rates to see which aligns best with your financial goals.
• Keep an eye on Bank of Canada rate announcements and economic trends that could impact mortgage rates. Note: With recent Bank of Canada announcements variable rates which are tied to Prime are dropping.

Taking these steps now will set you up for success. The more financially prepared you are, the smoother the process will be—and the better your chances of landing your dream home at the right price.

Fraud Awareness Month: Scams to Avoid
Did you know? March is Fraud Awareness Month, making it the perfect time to learn how to protect yourself and your mortgage from fraud.
Understanding common mortgage scams and how to recognize warning signs can make all the difference in safeguarding your financial well-being.
Common Mortgage Fraud Scams
One of the most frequent types of mortgage fraud involves a fraudster acquiring a property and artificially inflating its value through a series of sales and resales. They then secure a mortgage based on the inflated price, leaving lenders and buyers at risk.

Red Flags to Watch For
Be cautious if you encounter any of the following:
• Someone offers you money to use your name and credit to obtain a mortgage
• You’re encouraged to provide false information on a mortgage application
• You’re asked to leave signature lines or other sections of your mortgage application blank
• A seller or investment advisor discourages you from inspecting the property before purchase
• The seller or developer offers a rebate on closing that isn’t disclosed to your lender

Title Fraud: A Costly Scam
Another major concern is title fraud, which is a form of identity theft. This occurs when a fraudster, using false identification, forges documents to transfer your property into their name. They then take out a new mortgage on your home, collect the funds, and disappear—leaving you to deal with the consequences when your lender starts foreclosure proceedings.
How to Protect Yourself from Title Fraud
• Always visit the property you’re purchasing in person.
• Compare local listings to ensure the asking price is reasonable.
• Work with a licensed real estate agent.
• Be cautious of realtors or mortgage professionals with a financial stake in the deal.
• Request a copy of the land title or conduct a historical title search.
• Include a professional appraisal in the offer to purchase.
• Require a home inspection to check for hidden issues.
• Ask for receipts for recent renovations to verify legitimacy.
• Ensure your deposit is held in trust for added security.
• Consider title insurance—the best time to get it is before fraud occurs, not after.

Stay Vigilant and Take Action
Fraud can have devastating financial consequences, but staying proactive and informed is your best defense. If you suspect fraudulent activity, act quickly—report it to the authorities and take steps to protect your assets.
Knowledge is power, and by staying alert, you can keep your mortgage and finances secure. Monitoring your credit report can also help stay ahead of any fraud activity pertaining to identity theft!

Economic Insights from Dr. Sherry Cooper
The outlook for the Canadian economy in the coming months presents a picture of cautious optimism with high uncertainty. Economic indicators were expected to strengthen this year, driven by resilient consumer spending and a robust export sector. Housing activity was poised to accelerate this year as well.
However, when the newly inaugurated US president began to threaten Canada with 25% tariffs at the end of January, home sales slowed markedly. However, challenges such as global market volatility and inflationary pressures could temper this growth.

The Bank of Canada will maintain its current monetary policy stance, carefully balancing interest rates to manage inflation while supporting economic activity. The housing market remains a key area of focus, with efforts to address affordability and supply constraints continuing to be critical. Immigration is slated to slow this year, particularly for non-permanent residents, which will ease the housing shortage. Rents have fallen sharply in recent months.

Rising costs, labour shortages, and potential import tariffs on building materials could hinder construction activity.
Tariff threats are real and unnerving. Exports account for roughly a third of Canadian economic activity. Canada sends 75% of its exports to the US, led by energy, automobiles, and metals. Threatened attacks on these trade flows might initially spill into higher prices. Still, the primary impact would be to slow economic activity and increase unemployment, already at 6.6%, up from a cycle low of 4.8% in July 2022. In contrast, the US jobless rate is a mere 4.0% and GDP growth is a lot stronger than in Canada despite double the central bank rate cuts than south of the border.

In the event of a trade war, interest rates are more likely to fall as the BoC attempts to backstop the economy. This would decrease mortgage rates, with floating rates falling more than fixed-rate loans. About 1.2 million mortgages will renew this year, most of them at a higher rate, said real estate company Royal LePage in a report out this morning.
Almost 30% of those homeowners said they would choose a variable rate on renewal, up from 24% now on a floating rate. Sixty-six percent said they would renew on a fixed-rate loan, down from 75% now locked in.

Of those who expect their monthly mortgage payment to rise upon renewal this year, 81% said the increase would put a financial strain on their household.
There remains a good chance that Canada could avert a trade war. We’ve already taken action to tighten our border. The US could not easily replace the oil, hydroelectricity power, autos or aluminum it purchases from Canada. We are the largest export market for US products. Excluding oil exports, the US has a trade surplus with Canada. Revisions to the US, Canada, and Mexico trade deal, slated for next year, could be accelerated. The US has much bigger fish to fry than trade concerns with Canada.

On balance, interest rates are likely to fall further. Government actions to improve housing affordability and pent-up housing demand bode well for a housing revival this year. Canadian inflation is under control at about 2%, boosting the chances of additional rate cuts this year.

If you’d like to be added to my distribution list, send an email to mike.bohte@dominionlending.ca

Welcome to the February issue of my monthly newsletter!

This month, I have all the details for you around second mortgages and understanding if they are right for you! Plus, scroll down for some spring-cleaning tips as we start to shake off the winter dust!
Understanding Second Mortgages: Are They Right for You?

One of the biggest benefits to purchasing your own home is the ability to build equity in your property. This equity can come in handy down the line for refinancing, renovations, or taking out additional loans – such as a second mortgage.
A second mortgage refers to an additional or secondary loan taken out on a property for which you already have a mortgage. Some advantages include the ability to access a large loan sum, better interest rates than a credit card and the ability to use the funds how you see fit. However, keep in mind interest rates are typically higher on a second mortgage versus refinancing and can add additional cash flow tension to your monthly bills. Talk to a mortgage professional today to determine if this is the best option for you!

What is a second mortgage?
First things first, a second mortgage refers to an additional or secondary loan taken out on a property for which you already have a mortgage. This is not the same as purchasing a second home or property and taking out a separate mortgage for that. A second mortgage is a very different product from a traditional mortgage as you are using your existing home equity to qualify for the loan and put up in case of default. Similar to a traditional mortgage, a second mortgage will also come with its own interest rate, monthly payments, set terms, closing costs and more.

Second mortgages versus refinancing
As both refinancing your existing mortgage and taking out a second mortgage can take advantage of existing home equity, it is a good idea to look at the differences between them.
Firstly, a refinance is typically only done when you’re at the end of your current mortgage term so as to avoid any penalties with refinancing the mortgage. The purpose of refinancing is often to take advantage of a lower interest rate, change your mortgage terms or, in some cases, borrow against your home equity.
When you get a second mortgage, you are able to borrow a lump sum against the equity in your current home and can use that money for whatever purpose you see fit. You can even choose to borrow in installments through a credit line and refinance your second mortgage in the future.

Some key things to note when looking at a second mortgage or refinancing:
• If you have a favorable interest rate on your first mortgage, a second mortgage allows you to keep the lower rate on your primary loan, resulting in a lower blended rate.
• Refinancing resets the amortization schedule, which could extend the loan term. A second mortgage leaves the existing term intact, helping you stay on track with your overall financial goals.
• Second mortgages often come with more flexible terms, such as interest-only payments, fully open, or shorter term, which can suit your immediate needs.

What are the advantages of a second mortgage?
There are several advantages when it comes to taking out a second mortgage, including:
• Homeowners can access a significant portion of their home equity (typically 80%-85% LTV).
• Better interest rate than a credit card as they are a ‘secured’ form of debt.
• You can use the money however you see fit without any caveats.
• Allows you to access your home equity without breaking your existing mortgage and incurring penalty fees.

What are the disadvantages of a second mortgage?
As always, when it comes to taking out an additional loan, there are a few things to consider:
• Interest rates tend to be higher on a second mortgage than refinancing your mortgage.
• Additional financial pressure from carrying a second loan and another set of monthly bills.
Before looking into any additional loans, such as a secondary mortgage (or even refinancing), be sure to reach out to me! Regardless of why you are considering a second mortgage, it is a good idea to get a review of your current financial situation and determine if this is the best solution before proceeding.

10 Smart Spring-Cleaning Tips to Revitalize Your Home
As the days grow longer and the sun shines brighter, it’s the perfect time to refresh your home with a thorough Spring clean! A clean, organized space can help you feel more energized and ready to embrace the season ahead.

Here are some tips to make your Spring cleaning both efficient and enjoyable:
1. Create a Playlist: Make cleaning fun by curating a playlist of your favorite upbeat songs. Music not only makes the time fly but can also turn your cleaning routine into an enjoyable activity. Dance while you dust and sing while you sweep—your home will thank you!

2. Clean One Room at a Time: A clean home doesn’t happen overnight, so avoid feeling overwhelmed by tackling one room at a time. Start small, such as with bathrooms or closets, and work your way up to larger spaces like the kitchen or living room. Alternatively, dedicate one or two rooms per weekend, and by the time May rolls around, your home will sparkle!

3. Declutter as You Go: Spring cleaning isn’t just about scrubbing and polishing—it’s also the ideal time to declutter. Sort through closets, cupboards, and drawers, and separate items into “keep,” “donate,” and “discard” piles. Haven’t used that appliance or worn that sweater in over a year? It’s time to let it go. Clearing out the clutter not only makes cleaning easier but also creates a more organized and calming space.

4. Go Green: Keep your cleaning eco-friendly by opting for natural solutions. Vinegar and baking soda are versatile and effective for a variety of tasks, from cleaning countertops to unclogging drains. A steam cleaner can also be a fantastic tool for deep-cleaning floors, appliances, and even outdoor spaces without the need for harsh chemicals. Choose sustainable products to keep your home fresh and the environment happy.

5. Work From Top to Bottom: When cleaning, always start high and work your way down. Dust light fixtures, ceiling fans, and shelves first to avoid re-cleaning surfaces below. This method ensures maximum efficiency and minimizes extra work!

6. Don’t Forget Hidden Spaces: Pay attention to often-overlooked areas like baseboards, window tracks, and behind large furniture. Use a vacuum attachment to get into tight corners, and wipe down walls and doorframes for a truly comprehensive clean.

7. Freshen Up the Fridge & Freezer: Spring is the perfect time to clean out your fridge and freezer. Empty the contents, toss expired items, and clean the interior surfaces with a mixture of water and mild soap or vinegar. If defrosting is needed, plan ahead to minimize food waste. Restocking a fresh, clean fridge feels fantastic and can even inspire healthier eating habits!

8. Revitalize Air Quality: Spring allergens can wreak havoc on your sinuses, but replacing your HVAC and furnace filters can help. Upgrade to a higher-quality filter for added protection against allergens, chemicals, and odors. Consider adding an air purifier for an extra boost to your home’s air quality.

9. Wash Fabrics & Upholstery: Take time to wash or vacuum curtains, upholstery, and throw pillows, as they can harbor dust and allergens. Rotate or clean your mattress, and swap out heavy winter bedding for lighter, seasonal options. Fresh linens make a big difference in creating a rejuvenated space.

10. Tidy Outdoor Areas: Spring cleaning isn’t limited to the indoors! Sweep porches, patios, and decks, and clean outdoor furniture. If you have a garden, take this opportunity to prepare for planting by clearing debris and cleaning tools. A fresh outdoor space is the perfect complement to your revitalized home.

11. Embrace these tips, and your Spring clean will leave your home feeling fresh, organized, and ready for the new season!

Economic Insights from Dr. Sherry Cooper
Wall Street reacted positively to Trump’s initial tariff backpedalling, pushing US equity futures higher. This is a sign that he may pursue a less protectionist approach; for now, it is a boon for multinational companies that rely on cross-border commerce, giving them time to adjust pricing and mitigate any impact on profit margins.

The US dollar, however, slumped, albeit briefly. Whether the new president implements a 25% tariff on Canada on February 1—as he offhandedly suggested—is highly unlikely. It will take much longer than that for federal agencies to complete their analysis of Canadian trade and currency policy with the US. Canada’s dollar has traded markedly below the US dollar for years. And, although we promised to tighten our border restrictions, the US’s illegal immigration problems have little to do with Canada.

Trump wants to renegotiate the trade deal between the US, Canada and Mexico. He will surely pursue that end, with or without tariffs. The absolute risk of tariffs is a Canadian recession, not inflation. Although tariffs are often passed on to consumers, inflation is a first-round effect that quickly triggers layoffs and reductions in spending by consumers and businesses. The Bank of Canada’s initial reaction will be to cut interest rates to avoid a recession.

The Bank of Canada’s fourth-quarter consumer expectations survey reveals that despite recession concerns, 22.4% of respondents see a greater than 50% chance of moving to a new primary residence within the next year—up from 21.1% in the previous quarter.

Similarly, 13.5% of respondents plan to sell their home within the next year, up from 11.4% in Q3. The results also show increased interest from renters, with 19.9% considering a home purchase in the next 12 months, compared to 16.9% last quarter.

The Bank of Canada attributes the rise in homebuying intentions to expectations of further interest rate cuts in 2025.

“Survey results show that these home buying intentions are supported by consumers seeing and expecting easier credit conditions,” the report notes.

However, it also cautions that the timing of home purchases remains uncertain for many: “…those planning to buy a home over the next 12 months said they anticipate around a 50% probability of actually carrying through with those plans.”

The Q4 survey revealed that inflation expectations have primarily returned to historical norms. Consumers’ inflation expectations for food and gas stayed steady in the fourth quarter, while expectations for rent eased. However, they still anticipate rent will rise faster than pre-pandemic levels.

As a result of the improving inflation outlook, consumers expressed strong intentions to increase spending on essentials and housing over the next year. For the first time since 2021, they anticipate spending will outpace price increases.

While the new administration in Washington poses considerable uncertainty for the Canadian economy, the odds are that the Bank of Canada will successfully master a noninflationary rebound in economic activity in 2026.

If you’d like to be added to my distribution list, send an email to mike.bohte@dominionlending.ca

Welcome to the January issue of my monthly newsletter!

Happy New Year!
This month, I wanted to take a look at what is in store for us for the housing market as we head into 2025. Plus, I have some tips to help kick your financial health into gear for the next twelve months! Scroll down for all the details.

Market Outlook for 2025

It’s a new year and as we gear up for the upcoming Spring season, it is a good idea to take a look at the market outlook and what we are expecting to see around housing sales, prices, interest rates, and how these current conditions affect buyers versus sellers!

Let’s dive into the Canadian Real Estate Association Forecast and more:

National Trends

• Housing Sales: National home sales are expected to increase by 6.6% in 2025, reaching approximately 499,800 units as interest rates continue to decline, drawing buyers back into the market. This follows a modest 5.2% increase in 2024.
• Housing Prices:On a national level, Canada’s housing market is expected to see a 4.4% increase in home prices in 2025, reaching an average of $713,375. This follows a more modest 0.9% increase in 2024. The national growth is tempered by regional differences, with areas like Toronto and Vancouver seeing higher price levels due to ongoing demand, while more affordable regions like Quebec may see more moderate growth.
• Rising Demand: Canada’s housing market remains competitive, with demand continuing to rise in urban centers and suburban areas due to factors like population growth, economic recovery, and strong immigration.
• Interest Rates: The Bank of Canada’s policy on interest rates continues to play a central role in shaping the housing market. While rates were higher through 2023 and part of 2024, they are expected to continue declining in 2025, which should ease affordability constraints and encourage more buyer activity.

Regional Highlights

Greater Toronto Area (GTA)

• Housing Prices:The average home price in the GTA reached $1,135,215 in October 2024, reflecting a 0.8% increase year-over-year and 2.5% monthly growth. The City of Toronto itself saw a 3.4% increase, signaling continued demand despite higher prices. Areas like Mississauga and Brampton show mixed price trends, with Mississauga seeing a slight decline of 2.2% year-over-year, while Brampton experienced a 2.0% increase. These fluctuations reflect demand in more affordable areas within the GTA.
• Rising Demand: Toronto remains one of Canada’s most sought-after markets, driven by its status as a global financial hub and growing tech sector. Suburbs like Mississauga, Brampton, and York Region are seeing rising interest as buyers seek more affordable options. Ontario’s strong job market and immigration influx contribute to population growth, further boosting demand. While some cooling has been seen due to high home prices, the overall demand remains robust, especially for entry-level homes.
• Interest Rate Impact: Rates are expected to decrease into 2025 increasing buyer demand. Despite higher rates over the last two years, Toronto remains a seller’s market in many areas, though buyers will benefit from more favorable conditions as rates decline.

Greater Vancouver

• Housing Prices: Vancouver has experienced a slight decline in average home prices, down 0.2% year-over-year in 2024, with prices hovering around $1,250,329. However, Vancouver remains one of Canada’s priciest markets, and some recovery is expected as the market adjusts. While the downtown core sees slower price growth, suburban areas in the Lower Mainland, such as Richmond and Surrey, continue to see moderate price increases, as these areas offer better affordability and space.
• Rising Demand: Vancouver’s appeal remains strong for both domestic buyers and international investors, particularly in tech, entertainment, and natural resources sectors. Despite price stagnation, demand continues for detached homes and more spacious properties as residents seek to balance living costs with quality of life. Vancouver also benefits from significant immigration, and the city continues to diversify economically, drawing both residents and investors who are fueling demand in the housing market.
• Interest Rate Impact: Like Toronto, Vancouver has been affected by the Bank of Canada’s interest rate hikes, which have increased borrowing costs and cooled market activity. The rate hikes have caused some slowdown, but the region is expected to see a modest recovery in 2025 with interest rate cuts. As rates decline, Vancouver may experience more balanced market conditions, with higher demand for detached homes in suburban areas and some recovery in the more expensive core areas.

Quebec:

• Housing Prices:The province has seen steady growth in home prices, with Montreal, in particular, experiencing an 8.9% year-over-year price increase as of October 2024, reaching an average home price of $630,063. While Quebec’s growth is generally more moderate compared to Ontario and British Columbia, the relative affordability of homes in many areas still offers opportunities for buyers compared to more expensive regions like Toronto or Vancouver.
• Rising Demand: Montreal’s job market, particularly in technology and aerospace, continues to attract young professionals, which fuels housing demand. The province also benefits from ongoing immigration, contributing to population growth, which supports housing demand.
• Interest Rate Impact: Like the rest of Canada, Quebec will see easing interest rates in 2025, which should help to bolster market activity. However, since prices have risen significantly over the past decade, some buyers in Quebec, particularly first-time buyers, may still face affordability challenges, albeit less severe than in major cities like Toronto.

Expectations for Buyers

1. Affordability Challenges: While interest rates are expected to decline gradually, the impact of high housing prices in major cities like Toronto and Vancouver will still be a challenge for many buyers. However, some relief is anticipated as lower rates could ease monthly mortgage payments.
2. Opportunity in the Suburbs: Suburban areas are projected to see more price stability and may be more attractive to first-time buyers and those looking for better value for money. Areas like Mississauga, Brampton, and Ottawa are seeing mixed price changes, making them viable alternatives to the high-cost core regions.
3. More Inventory: A growing number of homes available for sale could give buyers more choice, but competition may still exist in certain markets due to demand returning as rates ease.

Expectations for Sellers

1. Tight Timing: Sellers in 2025 will likely benefit from a surge in demand in the spring and summer, driven by the stabilization or decline of interest rates. However, selling in a market with increased inventory may require competitive pricing.
2. Realistic Pricing: With the market expected to shift towards more buyer-friendly conditions, sellers will need to adjust expectations and price their homes carefully. Those listing too high might face longer waiting periods.
3. Stronger Negotiation Power in Suburbs: Sellers in high-demand, low-inventory areas (especially in suburban regions) may still enjoy more favorable conditions and could see prices rise or remain stable.

Key Takeaways for 2025

1. Recovery Driven by Rate Cuts: Declining interest rates are anticipated to accelerate both sales activity and price growth in the latter half of 2025.
2. Regional Disparities: While Vancouver and Toronto remain expensive, other regions like Montreal and Ottawa offer growth potential due to relative affordability and robust economic conditions.
3. Inventory and New Construction: Higher inventory levels may moderate price increases in some areas, but affordability concerns and economic factors will shape regional market dynamics.

Overall, 2025 will likely be a year of transition with benefits to both buyers and sellers as the market continues to stabilize.

Looking to purchase, renew or refinance your mortgage this year? Don’t hesitate to reach out to me.

Kickstart Your Year:
5 Steps to Improve Your Financial Health

Improving your financial health is essential for long-term stability and peace of mind.

STEP 1: This starts with creating a budget and sticking to it. Begin by tracking your income and all expenses for at least a month to understand where your money is going.

• Categorize your spending into essentials (housing, utilities, groceries) and non-essentials (entertainment, subscriptions). Use this information to set realistic spending limits and prioritize needs over wants.
• Apps and tools can also make budgeting easier and more effective.

STEP 2: Next is to build an emergency fund. Life is unpredictable, and having a financial cushion can prevent setbacks from turning into crises.

• Aim to save 3–6 months’ worth of living expenses, but don’t be discouraged if that feels daunting.

Start small, even $10–$20 from each paycheck, and automate your savings to ensure consistency. Over time, these small contributions will grow into a safety net.

STEP 3: Debt can be a significant barrier to financial health, so it’s crucial to pay down debt strategically. High-interest debt, like credit cards and payday loans, should be your top priority, as it compounds quickly and can drain your resources.

• Use strategies such as the snowball method (paying off the smallest debts first for psychological wins) or the avalanche method (focusing on the highest-interest debts to save money overall). Whichever method you choose, ensure you make at least the minimum payments on all debts to avoid penalties.

STEP 4: Another vital component of financial health is to invest in your future.

• Begin contributing to retirement accounts, such as an RRSP if your employer offers one, especially if there’s a company match—it’s essentially free money.
• If an RRSP is not an option, consider a high-interest savings account.

Beyond retirement, explore low-risk investments, which can grow your wealth steadily over time. Even small, consistent contributions can lead to significant returns thanks to compound interest.

STEP 5: It’s essential to regularly review and adjust your financial plan. Financial needs and goals evolve, so take time annually—or after major life events like a new job, marriage, or a baby—to reassess.

• Review your budget, savings, investments, and debt repayment progress. Adjust your plan as needed to stay on track and adapt to changes.
• Regular check-ins help you stay proactive and maintain momentum toward your goals.

Financial health is a journey, not a destination. Consistency, patience, and smart planning will lead you to long-term stability and financial freedom. Remember, even small steps make a big difference over time!

Economic Insights from Dr. Sherry Cooper

There is an unprecedented disparity between the economic and financial situation in the US and Canada. The Canadian economy is far more interest-sensitive than the US and, therefore, slowed more dramatically in response to the Bank of Canada’s restrictive policy to bring inflation back to its 2% target level.

The jobless rate in Canada has reached 6.5%, well above the level in the US, and job vacancy rates have plummeted. Wage inflation has been sticky at 4.9% but will likely edge downward in response to excess supply in the labour market.

Inflation accelerated to 2% y/y in October, compared to the cycle-low 1.6% in September, mainly because gasoline price deflation slowed. The odds of another 50 bps rate cut by the central bank—on the heels of a jumbo cut in October—have diminished, but a 25 bps cut is in the bag.

Market-driven interest rates in Canada are well below those in the US, owing to weaker economic activity and lower inflation. US interest rates surged on the news of the Trump election victory. Ten-year US Treasury yields rose sharply to a post-election high of nearly 4.5% on the presumption that with a Republican majority in the House and the Senate, Trump will move ahead with tax cuts, tariffs and deregulation. Trump has also threatened to limit the independence of the Federal Reserve.

Canadian long-term yields have risen far less since the election. Short-term interest rates are also lower in Canada than in the US. The Bank of Canada has eased monetary policy four times for a total decline in the overnight policy rate of 175 bps, compared to only one rate cut of 50 bps by the Fed. This unprecedented divergence bodes well for a rebounding housing market in Canada.

Housing activity picked up in October and early November in response to the surge in new listings, giving potential buyers a broader range of choices and lower interest rates. The steepening yield curve portends more significant declines in variable mortgage rates—tied to the prime rate, which declines with every cut in the overnight rate, than fixed rates, which move with longer-term bond yields.

The Bank of Canada, concerned about a weakening Canadian economy, will continue to cut the overnight rate at every meeting between now and mid-2025. By then, the policy rate will be roughly 2.5%, half the level at the peak in BoC tightening. This will likely trigger a robust spring housing season.

There is plenty of pent-up activity in the Canadian housing market as buyers have waited for lower interest rates and home prices, and sellers have been reticent to list their properties, hoping for a housing recovery. This is beginning to turn around as every easing move by the Bank of Canada boosts economic activity, particularly in the interest-sensitive housing sector.

If you’d like to be added to my distribution list, send an email to mike.bohte@dominionlending.ca

Welcome to the December issue of my monthly newsletter!

As the end of the year approaches, I wanted to have one more check-in with you and provide some final tips for 2024! Scroll down and check out my favourite home and finance resolutions, along with some tips for decluttering your home in preparation for 2025. Have a great month!

Resolutions for Your Home and Finances

As the new year approaches, it’s a natural time to reflect on our personal goals and set resolutions for the months ahead. Your home and finances are key areas where small, intentional changes can lead to big improvements in security, stability, and quality of life.

Here are some resolutions to get you started!

Create a Realistic Home Budget

A well-planned budget is essential for financial peace of mind. Whether you’re new to budgeting or want to refine your approach, creating a realistic budget helps prioritize spending, track bills, and put money toward meaningful goals.

• Identify Fixed and Variable Expenses: List out fixed costs, like mortgage payments, utilities, and insurance, as well as variable ones, such as groceries and entertainment.
• Set Savings Goals: Include savings as a “non-negotiable” in your budget, earmarking funds for home repairs, investments, or emergencies.
• Track and Adjust: Track spending throughout the month and adjust where necessary. Financial apps like Mint or You Need a Budget (YNAB) make it easier to stay on course.

Set Goals to Build Home Equity

Building home equity is a key path to increasing net worth. Whether you’re planning to sell or stay in your home long-term, building equity can offer financial flexibility and security.

• Make Extra Mortgage Payments: Even a small additional payment toward your mortgage principal each month can shorten your loan term and reduce interest costs. A biweekly payment plan is another effective method to pay down the principal faster.
• Consider Strategic Home Improvements: Invest in upgrades that boost home value, like kitchen and bathroom remodels, or energy-efficient upgrades like new windows or solar panels. Prioritize improvements that add the most value to your property.

Develop a Plan to Pay Down Debt

Paying down debt (especially after the holidays!) can help free up cash flow. It is key to focus on high-interest debts first, such as credit cards, to maximize your payments.

• Use the Debt Avalanche or Snowball Method: The avalanche method involves paying off high-interest debts first, while the snowball method focuses on smaller debts first. Choose the one that best fits your motivation style
• Consider Refinancing or Consolidation: If you have a high-interest mortgage or multiple debts, refinancing or consolidating might reduce interest rates, making debt repayment more manageable
• Celebrate Milestones: Paying off debt can feel challenging, so celebrate progress. Every milestone achieved brings you closer to financial freedom.?

Commit to Energy Efficiency to Lower Bills

Saving on energy costs can have a significant impact on your budget, especially in colder or warmer months. Simple changes around the home can save you money while benefiting the environment!

• Invest in Smart Thermostats: A programmable thermostat can automatically adjust heating and cooling based on your schedule, saving energy when you’re not home.
• Switch to LED Lighting: LED bulbs use significantly less energy and have a longer lifespan than traditional bulbs.
• Insulate Windows and Doors: Adding weatherstripping to doors and windows keeps drafts out, making your heating and cooling systems more efficient.

Review Your Insurance Policies and Coverage

Insurance is a key element of financial security, but it’s easy to forget about it until something goes wrong. As you head into the new year, this is a great time to make sure you’re fully covered!

• Assess Homeowners and Mortgage Insurance: Review coverage limits and ensure your policy covers potential risks, including natural disasters if you live in high-risk areas.
• Shop for Better Rates: Contact your provider for discounts or shop around for new rates. Bundling policies, like home and auto insurance, can often yield savings.
• Update Beneficiaries and Coverage: Life circumstances change, and your insurance should reflect that. Update your beneficiaries, adjust coverage, and ensure policies align with your financial goals.

Setting resolutions for your home and finances doesn’t have to be daunting! Start with small, actionable goals to help transform your finances – and your mindset – for 2025!

12 Tips for Decluttering Your Space

Decluttering can bring a sense of calm and order to your space, especially as the holiday season approaches.

Here are some practical tips to help get organized:

1. Start Small and Set Achievable Goals: Avoid overwhelm by breaking down the decluttering process into manageable steps. Set realistic goals, such as dedicating just 15 minutes a day to tidying up. Begin with a small area—like a single drawer or shelf—and gradually expand to larger spaces as you build momentum and confidence.
2. Use the “One-In, One-Out” Rule: For every new item you bring into your home, make it a rule to remove an old one. This simple habit keeps your space from accumulating unnecessary items and helps maintain a balanced, organized environment.
3. Sort and Categorize with Purpose: Sorting items as you go makes it easier to stay organized and keep track of where everything belongs. Use boxes or bins labeled “Keep,” “Donate,” “Sell,” and “Recycle/Trash” to give each item a clear destination. This method ensures that you can tackle everything in one go without second-guessing.
4. Focus on Essentials and Joy: When deciding what to keep, ask yourself, “Does this item serve a purpose, or does it bring me joy?” If the answer is no, it’s probably time to let it go. Focusing on essentials and things that spark joy can help you make more meaningful decisions about what truly belongs in your home.
5. Digitize Paper Clutter: Free up physical space by scanning or photographing important documents and storing them digitally. Use cloud storage or an external hard drive to keep these files secure and easily accessible. This practice reduces paper clutter and provides a backup in case of loss or damage.
6. Declutter in Layers for Lasting Results: Tackle clutter in layers to avoid feeling overwhelmed. Start with the most obvious items—like broken or rarely used belongings—and gradually work your way through more sentimental or difficult-to-decide items. Revisiting each area multiple times helps you refine your space down to the things you truly need or cherish.
7. Adopt a “Capsule” Mindset for Clothes and Accessories: Build a capsule wardrobe by focusing on versatile, high-quality clothing pieces that you love and regularly wear. Store out-of-season items separately to keep your main closet neat and functional. This approach simplifies decision-making and can make daily routines smoother.
8. Set Up Regular Decluttering Routines: Make decluttering a habit by scheduling quick, regular clean-ups—a few minutes each day or a larger session every month. Consistency prevents clutter from building up over time and helps you maintain a tidy, organized space effortlessly.
9. Involve the Whole Family: Encourage family members to declutter their own spaces and lead by example. Demonstrating the benefits of a tidy, organized home can inspire everyone to participate, making the whole process faster and more enjoyable.
10. Treat Your Space as “Prime Real Estate”: View the most visible and accessible areas of your home as “prime real estate.” Reserve these spaces for the items you use and love the most, and relocate or discard things that aren’t worth taking up valuable room.
11. Embrace Simple Storage Solutions: Use baskets, bins, and clear containers to keep your belongings organized and out of sight. Labeling containers makes it easy to find what you need at a glance, keeping everything in order while reducing visual clutter.
12. Reevaluate Seasonal Items Regularly: After each season, go through holiday decorations, seasonal clothing, and other temporary items to decide what’s worth keeping. Donate, sell, or discard anything you no longer use. This ongoing process will help prevent excess accumulation year after year.

These tips can help you create a cleaner, more peaceful environment and build habits to stay organized in the long term. Happy decluttering!

Economic Insights from Dr. Sherry Cooper

There is an unprecedented disparity between the economic and financial situation in the US and Canada. The Canadian economy is far more interest-sensitive than the US and, therefore, slowed more dramatically in response to the Bank of Canada’s restrictive policy to bring inflation back to its 2% target level.

The jobless rate in Canada has reached 6.5%, well above the level in the US, and job vacancy rates have plummeted. Wage inflation has been sticky at 4.9% but will likely edge downward in response to excess supply in the labour market.

Inflation accelerated to 2% y/y in October, compared to the cycle-low 1.6% in September, mainly because gasoline price deflation slowed. The odds of another 50 bps rate cut by the central bank—on the heels of a jumbo cut in October—have diminished, but a 25 bps cut is in the bag.

Market-driven interest rates in Canada are well below those in the US, owing to weaker economic activity and lower inflation. US interest rates surged on the news of the Trump election victory. Ten-year US Treasury yields rose sharply to a post-election high of nearly 4.5% on the presumption that with a Republican majority in the House and the Senate, Trump will move ahead with tax cuts, tariffs and deregulation. Trump has also threatened to limit the independence of the Federal Reserve.

Canadian long-term yields have risen far less since the election. Short-term interest rates are also lower in Canada than in the US. The Bank of Canada has eased monetary policy four times for a total decline in the overnight policy rate of 175 bps, compared to only one rate cut of 50 bps by the Fed. This unprecedented divergence bodes well for a rebounding housing market in Canada.

Housing activity picked up in October and early November in response to the surge in new listings, giving potential buyers a broader range of choices and lower interest rates. The steepening yield curve portends more significant declines in variable mortgage rates—tied to the prime rate, which declines with every cut in the overnight rate, than fixed rates, which move with longer-term bond yields.

The Bank of Canada, concerned about a weakening Canadian economy, will continue to cut the overnight rate at every meeting between now and mid-2025. By then, the policy rate will be roughly 2.5%, half the level at the peak in BoC tightening. This will likely trigger a robust spring housing season.

There is plenty of pent-up activity in the Canadian housing market as buyers have waited for lower interest rates and home prices, and sellers have been reticent to list their properties, hoping for a housing recovery. This is beginning to turn around as every easing move by the Bank of Canada boosts economic activity, particularly in the interest-sensitive housing sector.

Welcome to the November issue of my monthly newsletter!
This month, I wanted to highlight some tips around refinancing your mortgage and considerations to make at renewal time! Plus, with the holidays just around the corner, I have included some of my favourite DiY gifting ideas to help get you started! Scroll down for all the details.

Refinancing Your Mortgage

Refinancing your mortgage can be a smart financial move for many reasons, and as your trusted mortgage advisor, I’ve seen how much it can benefit homeowners!

Ideally, refinancing is done at the end of your mortgage term to avoid penalties, but the timing can vary depending on your goals.

For some, it’s about unlocking the equity in their home to fund renovations, increase the size of an investment portfolio or cover big expenses like college tuition. For others, it’s an opportunity to consolidate debt, lower their interest rate, or change up their mortgage product.

Let’s take a closer look at some of the ways refinancing your mortgage can help!

• Get a Better Rate: As interest rates have continued to decrease with the Bank of Canada updates these past few months, now is a great time to consider refinancing for a better rate and lower overall mortgage payments! Experts anticipate the Bank of Canada will move to have the overnight rate down to 2.75% next year.
• Consolidate Debt: When it comes to renewal season and considering a refinance, this is a great time to review your existing debt and determine whether or not you want to consolidate it onto your mortgage. In most cases, the interest rate on your mortgage is less than you would be charged with credit card companies or other forms of financing you may have. Plus, having all your debt consolidated into a single payment can keep you on track!
• Unlock Your Home Equity: Do you have projects around the house you’ve been dying to get started on? Need funds for a large purchase such as a new vehicle or post-secondary education? When you are looking to renew your mortgage, it is a great opportunity to consider refinancing in order to take advantage of the home equity you have built up to help with these larger changes in your life!
• Change Your Mortgage Product: Are you unhappy with your existing mortgage product? If you have a variable-rate or adjustable-rate mortgage, you may be considering locking it in at the lower rates. Alternatively, you may want to switch your current fixed-rate mortgage to a variable option with the interest rates expected to continue decreasing into 2025. You can also utilize your refinance to take advantage of a different payment or amortization schedule to help pay off your mortgage faster!

PLUS! Some latest changes by the Government of Canada will make it even easier for you when it comes to your renewal and refinancing options:

• Those of you who may have an uninsured mortgage will no longer have to pass the stress test as of November 21st. This means that you have more flexibility when it comes to rates and mortgage products in renewal or refinance cases in cases where you wish to switch lenders without adding additional funds to your mortgage!
• Beginning January 15, the federal government will allow default-insured mortgages to be refinanced to build a secondary suite. If you’ve been considering adding a suite to your property, you may be eligible to access up to 90% of your home’s equity for this purpose.

No matter your plans or situation, please don’t hesitate to reach out to me for expert mortgage advice!

DiY Holiday Gifting Idea

Looking for some creative and thoughtful DIY holiday gifting ideas that are easy to make and can add a personal touch to your gifts this season?

These affordable, fun, and personalized options can suit anyone in your life – and they’ve never been easier to make!

• Homemade Scented Candles: These are easy to make requiring only a few ingredients but can be a great statement for friends and family! Pick their favourite scent in essential oil (lavender, peppermint, cinnamon, sage, etc.) and mix in with melted wax and pour into jars with a wick! Plus, you can customize them further with fun holiday-themed tags or labels on the jars.
• DiY Bath Bombs: Surprisingly easy to make, these bath bombs pair especially well with a homemade candle or handmade soap for the ultimate personal-scented bath set! Requiring just baking soda, citric acid, Epsom salts and essential oils to set in molds, these are a fun, low-cost gift idea!
• Handmade Soaps: Another great gift idea to make a personalized statement are handmade soaps! All you need is a soap base, essential oils, and additives to pour into molds to set! Want to get extra personalized? Find unique and fun molds that celebrate the personality of that friend or family member.
• Personalized Photo Calendars: Fun for the whole family, personalized calendars can be a great way to snapshot your previous year and highlight the good times as you head through 2025! You can have these created online or do it yourself by printing photos and a template, binding the pages with ribbon, and adding handwritten, personal notes on special dates!
• Custom Recipe Book: Do you have fun family recipes or have friends with a list of top treats? Why not create a custom recipe book with their favourite eats! All you need is a blank notebook or binder, printed recipes plus some photos for added personalization.
• Knitted Outdoor Wear: With the temperatures starting to drop, why not give the gift of comfort with a scarf or hat knitted with love? Combine their favourite colours or patterns and even add a personalized name tag!

The season of giving has never been easier with these affordable, fun and personalized gift ideas for all those special folks in your life.

Economic Insights from Dr. Sherry Cooper

The 2024-2026 mortgage renewals “cliff” is manageable as long as the Bank of Canada cuts interest rates and the job market and economy don’t weaken too much. Owing to the 75 basis point rate decline through September and the 50 bps cut in October, not all mortgages will renew at higher rates next year.

Royal Bank economists estimate that total mortgage payments in 2025 will increase by about 0.1% of total household disposable income as many extend amortizations to keep payments low.

The jobless rate, though declining a tick in September to 6.5%, is meaningfully higher than before the pandemic and is likely to rise to 7% next year.

The total number of job openings in the economy is 25% below what it was a year ago, and if it were to weaken further, the unemployment rate would rise even more.

Earlier this cycle, there were more job vacancies than people looking for work, so the drop in job openings didn’t have a material impact on the economy. But that’s no longer the case. September’s inflation data confirms that the job market trend is downward.

Economic growth has been below potential since 2022, and preliminary third-quarter data indicate another slowdown to about 1.3% growth in Q3, well below the BoC’s initial forecast. Hiring intentions remain woefully inadequate in the face of staggering population growth.

Business start-ups are also sluggish, reflecting a business climate undermined by overly restrictive monetary policy.

The BoC must now aggressively cut interest rates. Monetary policy remains highly restrictive.

The Bank of Canada’s Business Outlook Survey shows no sign of stabilization in the short term. Indeed, hiring intentions were virtually unchanged in Q3 and remained below the historical average. A significant number of companies are overstaffed.

The latest data show that the private sector vacancy rate is plummeting and has reached its lowest level since 2016. More than half of all small- and medium-sized businesses are fearful of weakening demand for their goods and services.

The number of active companies fell sharply in the second quarter due to a sharp jump in business closures and a low number of start-ups. The stagnation in the number of active companies in Canada since 2022 is undoubtedly one consequence of the extremely powerful tightening of monetary policy.

If you’d like to be added to my distribution list, please email me. mike.bohte@dominionlending.ca

Welcome to the October issue of my monthly newsletter!
It’s spooky season, but thankfully with the latest Bank of Canada rate cuts, your mortgage doesn’t have to be! Find out what the decreased interest rates mean for you, plus check out my tips to alleviate your financial stress this Fall.

Scroll down for all the details!

What the Bank of Canada Rate Drops Mean for YOU!

With the Bank of Canada rate decreases throughout the summer and into September, I thought this would be a great opportunity to update you on what this means for your mortgage.  If you’re on an adjustable-rate mortgage, this will result in a slight decrease in your mortgage payments, giving you more cash flow each month!

For example, if your mortgage balance is $750,000 at the previous 6.20% interest rate your approx. compounded monthly payment was likely around $4,924. With the new rate of 5.95% your approx. compounded monthly payment on an adjustable-rate mortgage will be $4,809*. This is an estimated $115/m decrease ($15/m per 100k balance) on your payment. While it may not seem like much, it can certainly add up over time resulting in hundreds of dollars in savings.

*Rates based on example of Prime minus .50% (old prime 6.70 and new prime 6.45)

Borrowers with static-payment variable-rate mortgages will also benefit from Bank of Canada rate decreases. While the monthly payment stays the same on these types of mortgages, the lower interest rate means that more of your monthly payment will go towards paying down your mortgage principal, and less will go towards interest.

Fixed-rate mortgages do not change when the Bank of Canada increases or decreases rates. However, if you have a fixed-rate mortgage, this declining rate environment could make it easier when it comes time to renew or refinance your mortgage. Lower rates give you more borrowing power in the market – this means your money can go further!

Recent changes are also great news for first-time buyers! Not only does a lower interest rate allow for more qualification options and lower payments, but recent Government of Canada changes on mortgage rules have removed many barriers previously faced by first-time home buyers.

The Bank of Canada has two more decision dates this year in October and December. Experts anticipate the Bank of Canada will continue these quarter-point rate cuts, taking the overnight rate down to 4.0% at year-end and potentially down to 2.75% next year.

Whether you’re a current homeowner, looking to refinance or renew, or wanting to purchase, this is exciting news for Canadians across the country!

However, keep in mind rate is not the be-all-end-all of mortgages. Factors such as type of mortgage, down payment amount, payment schedule, amortization, prepayment penalties, and more will also affect your mortgage and affordability.

If you want more information about your specific mortgage and how this changing environment affects your situation, please don’t hesitate to reach out!

5 Tips to Manage Financial Stress

Despite the Bank of Canada taking steps to reduce interest rates, many Canadians still feel pressure due to the overall cost of living and inflation. This uncertainty can be unnerving for many individuals, but don’t fret! I have some tips and suggestions to help you manage your financial stress and help you to power through these latest economic changes:

1. Prioritize What You Can Control: It can be easy to feel like you have no control over your financial situation, especially with the economy in flux. However, dwelling on things you cannot fix will only cause more stress. Instead, we recommend focusing on what you CAN control within your situation. For instance, take a looking at your phone bill and services to see if you can reduce the cost (even temporarily), reviewing your grocery bill and looking for places to switch to cheaper brands or alternatives, perhaps buying in bulk. You’ll not only save money, but you will feel like you have more control and help reduce stress.
2. Pay Essential Bills: If you are struggling to pay your monthly bills, prioritizing them can help you gain some control. Knowing which bills are most important to pay first can help reduce anxiety as you’re not scrambling to decide what to do. In some cases, prioritizing your bills can also help you uncover unnecessary spending and you may find something that can be eliminated entirely (even temporarily).
3. Automate Payments and Savings: If you’re struggling to keep up with your bills and payments, or are finding that you keep saying you’ll save money, but aren’t, considering automation for your finances can be a step in the right direction. Ensuring that your bills are paid on time will help reduce stress and protect you from wasting money on penalties for missed payments. Alternatively, you can also set up automatic money transfers on the days you are paid to move funds into a separate, savings account before you even see it. Thereby, reducing the likelihood that you’ll skip adding to your savings that month or use that money elsewhere.
4. Find Ways to Earn More Money: When cashflow is a problem and you are feeling the strain of trying to afford your current lifestyle, looking for ways to earn additional money can be a lifesaver! Consider part-time work for the weekends, consulting in your area of expertise or picking up extra hours at your current place of work. Now is also a great time to discuss with your manager if you are due for a raise.

Talk to Your Mortgage Professional: For most people, their mortgage is their largest monthly bill. If you are feeling the financial crunch, now is a great time to talk to meabout potentially changing your payment schedule or even looking for a different mortgage product with better rates (ideally if you are at the end of your term). Do not hesitate to be honest about your situation and ask what your options are.

Regardless of where you find yourself financially, there are often many solutions to help reduce and resolve your stress and ensure that you have healthy monthly cashflow.

Economic Insights from Dr. Sherry Cooper

Two significant developments in September will have a lasting positive impact on Canadian housing activity. First were Ottawa’s measures to make housing more affordable. Second was the Fed’s 50 basis point rate cut.

Ottawa has come under increasing pressure to reduce immigration, build more housing, and help first-time homebuyers afford to buy a home. In response, the federal government increased the home price cap for insured mortgages from $1 million to $1.5 million. This is the first time the home value limit has been raised since 2012.

This will allow many more home purchasers to buy with a smaller downpayment (10% rather than 20%) and 30-year amortizations (up from 25 years for non-insured mortgages).

• A $1.5 million home will now require a $125,000 down payment (8.33%). That’s less than half the current $300,000 required ante (assuming the feds keep the minimum down payment tiers the same)
• The maximum insurance premium on a $1.5 million purchase with 30-year amortization will now be $57,750 (again, assuming 10% down on any purchase price portion over $500,000).

This will significantly impact high-cost real estate markets such as Vancouver and Toronto, where the selling prices average $1.1 million in Toronto and $1.2 million in Vancouver. In addition, all insured new-build buyers can get 30-year amortizations, not just first-time buyers.

With mortgage rates falling rapidly, these measures will accelerate the growth in housing demand.

Also, the good news was the Federal Reserve’s 50 basis point rate cut, the first such cut in this cycle. Fifty is double the usual policy change increment. Such moves are typically reserved for emergency Fed meetings or clear and present liquidity threats. This opens the door for the Bank of Canada to have a super-sized rate cut in October or December. This bodes well for building home sales going into the all-important spring season.

Inflation has fallen considerably, and the Canadian unemployment rate has risen sharply. While retail sales for July showed a considerable rebound, it was mainly because of a surge in car sales. Nonetheless, spending growth pales in comparison to the population surge.

Welcome to the September issue of my monthly newsletter!

It is already September and I am excited to share my latest newsletter with you! This month, I have some details about the upcoming Fall market, along with expert tips for staging your home! Scroll down for all the details and have a great month.

2024 Fall Market Outlook

The initial Bank of Canada rate cuts this past summer did not spur housing activity as anticipated, but potentially more on the way will continue to affect the housing market outlook. New listing levels are expected to rise as sellers who may have held back enter the market with the hope that lower mortgage rates will attract additional buyers.

While the current Bank of Canada rate of 4.5% may still not be enough to make a dent in home affordability, it does provide a glimmer of hope for potential buyers as interest rates continue to fall.

Canadians across the country are anxiously awaiting additional rate cuts, promoting future home affordability. While consumer confidence is beginning to rise, mortgage affordability will need to be balanced with rising unemployment to reduce the number of households with strained budgets.

In addition, while home prices have cooled a bit, home prices in Canada remain among the highest in the world’s most advanced economies (Japan, France, Germany, Italy, and the UK). These still -high prices have resulted in many potential first-time home buyers to withdraw for now. Higher property taxes, higher qualifying stress-test rates, and the current wave of mortgage renewals will also factor into how successful the Fall market will be.

In 2023 alone, the country saw an influx of 46% of new Canadians, which also contributes to housing demands and pricing. As rates continue to drop, the hope is that prices will stabilize owing to increased supply as demand rises.

If you are looking to get into the housing market as a buyer or seller, or simply have questions so you can best prepare yourself for a future move, don’t hesitate to reach out to me.

Expert Tips for Staging Your Home

Even in a sellers’ market, there are some ways you can improve your chances of increasing the number of offers and selling your home for the best value.

Check out these expert tips for staging your home to help make the best first impression possible:

1. Clean and Declutter: Clean, clean, and clean some more! While you might not be able to stage each room in your home, it is vital to ensure that each space is cleaned and decluttered. Especially ensure that counters, carpets, flooring, and appliances are spotless! This not only signals pride of ownership, but it helps display the potential of the spaces to buyers.
2. Depersonalize: While you’re working through and cleaning your spaces, make sure to depersonalize along the way. Ideally, any family photos, kids’ drawings, etc, should be removed or replaced with more general photography to better appeal to potential buyers.
3. Focus on Key Spaces: The primary areas in your home are your living room, kitchen, dining room, and master bedroom. If you are not able to get to each room, these are the ones you should focus on to ensure your home is represented as best as possible.

4. Consider a Fresh Coat: Did you know? According to a RE/MAX Canada Renovation Investment Report, 36% of buyers prefer a fresh coat of paint! This can go a long way to making your home look new and revitalized.

5. Boost Curb Appeal: While you’re staging your home, don’t forget about curb appeal! The exterior of your home is just as important as the interior – if not MORE important for first impressions. A good place to start would be renting a power washer to scrub down your driveway and exterior walls.

Economic Insights from Dr. Sherry Cooper

As the Bank of Canada cuts interest rates, housing activity has remained relatively weak. Existing home sales were well below historical averages in July, while new listings edged upward. Prices have plateaued, and residential mortgage originations are tepid.

Mortgage balances grew by 3% annually in Q2, the second slowest quarterly pace since 2000.

This portends a further dip in household debt-to-income ratios—welcome news, as elevated leverage drives household financial vulnerability. The central bank is widely expected to continue to cut the overnight policy rate at the remaining meetings this year and well into 2025. Monetary policy remains highly restrictive, with the policy rate at 4.5%, well above the 2.5% inflation rate.

We believe interest rates will continue to fall as the overnight rate heads for 2.75%. By later this year, housing activity is likely to pick up gradually.

In the meantime, Canadian homebuilding remains sturdy despite softness in the resale market and ongoing capacity pressures. Housing starts surged again in July. The data series is volatile, but the trend is strong at just under its recent all-time highs posted in 2021. The strength of residential starts has been dominated by multi-unit construction, while single-family starts have historically been very weak.

The home construction sector has suffered ongoing capacity pressures, including a shortage of construction workers, zoning restrictions and supply bottlenecks. These capacity pressures have delayed housing completions, bringing the number of dwellings under construction to fresh record highs.

Homebuilding has remained remarkably resilient, albeit at a much slower pace than the torrid population growth. The government plans to cool the growth in temporary immigration, but the Bank of Canada recently suggested that the slowdown is likely to be delayed and smaller than originally projected.

Meanwhile, Canadian labour markets are easing. Job vacancy rates have plunged, and unemployment has risen, especially for young workers and new immigrants.

Economic growth has slowed to about 1% this year and will pick up only moderately next year. Inflation is falling without a recession. To be sure, some sectors have slowed meaningfully, especially manufacturing. Canadian businesses are bracing for billions of dollars in losses if the country’s two national railways shut down this week.

More than 9,000 workers at Canadian National Railway Co. and Canadian Pacific Kansas City Ltd. could either be on strike or locked out if no labour agreement is reached by Thursday, disrupting the supply chain industries.

Housing markets will begin to recover as lower interest rates do their job this fall.

Welcome to the August issue of my monthly newsletter!
I hope you’ve had a fantastic summer so far! This month, I am excited to give you some tips on paying off your mortgage faster. Plus, learn my favourite ways to cut energy costs and save. Scroll down for all the details and have a great month!

How to Pay Off Your Mortgage Faster

When it comes to homeownership, many of us dream of the day we will be mortgage-free. While most mortgages operate on a 25-year amortization schedule, there are some ways you can pay off your mortgage quicker!

Did you know? There are a few ways you can help pay off your mortgage faster.

For example – switching to an accelerated bi-weekly payment schedule, increasing your monthly mortgage payments to pay more to the principal, making extra payments on your mortgage, negotiating a better rate, or refinancing to a shorter amortization period!

Let’s take a look at the options and how they work:

1. Review Your Payment Schedule: Taking a look at your payment schedule can be an easy way to start paying down your mortgage faster, such as moving to an accelerated bi-weekly payment schedule. While this will lead to slightly higher monthly payments, the overall result is approximately one extra payment on your mortgage per calendar year. This can reduce the total amortization by multiple years, which is an effective way to whittle down your amortization faster.
2. Increase Your Mortgage Payments*: This is another fairly simple change you can execute today to start having more of an impact on your mortgage. Most lenders offer some sort of pre-payment privilege that allows you to increase your payment amount without penalty. This payment increase allowance can range from 10% to 20% payment increase from the original payment amount. If you earned a raise at work, or have come into some money, consider putting those funds right into your mortgage to help reduce your mortgage balance without you feeling like you are having to change your spending habits.
3. Make Extra Payments*: For those of you who have pre-payment privileges on your mortgage, this is a great option for paying it down faster. The extra payment option allows you to do an annual lump-sum payment of 15-20% of the original loan amount to help clear out some of your loans! Some mortgages will allow you to increase your payment by this pre-payment privilege percentage amount as well. This is another great way to utilize any extra money you may have earned, such as from a bonus at work or an inheritance.
4. Negotiate a Better Rate: Depending on whether you have a variable or a fixed mortgage, you may want to consider looking into getting a better rate to reduce your overall mortgage payments and money to interest. This is ideally done when your mortgage term is up for renewal and with rates starting to come back down, it could be a great opportunity to adjust your mortgage and save! This may be done with your existing lender OR moving to a new lender who is offering a lower rate (known as a switch and transfer).

Refinance to a Shorter Amortization Period: Lastly, consider the term of your mortgage. If you’re mortgage is coming up for renewal, this is a great time to look at refinancing to a shorter amortization period. While this will lead to higher monthly payments, you will be paying less interest over the life of the loan. If you’re interested in this, connect with me today so we can calculate if it is worthwhile for you to take advantage! Knowing what you can afford and how quickly you want to be mortgage-free can help you determine the best new amortization schedule.

*These options are only available for some mortgage products. Check your mortgage package or reach out to me to ensure these options are available to you and avoid any potential penalties.

If you’re looking to pay your mortgage off quicker, don’t hesitate to call me to go over your options in more detail today!

Smart Ways to Cut Your Energy Costs

In the last decade, climate change and energy efficiency have become top of mind for many Canadians. From wanting to do our part by recycling to making our home as energy efficient as possible, there are so many benefits to being environmentally and energy conscious.

If you are looking to cut costs or simply want to reduce your eco-footprint, here are some great ways to cut your energy costs:

• Get a Smart Thermostat: A pretty easy installation, a smart thermostat can help you better manage your in-home temperature. Whether you opt to install a basic programmable thermostat or try Google’s Nest, which learns from you and works to predict which temperatures you prefer and when, getting a read on your in-home temperature can help you better manage your energy usage.
• Look for Drafty Spots: When it comes to heating your home, it can quickly become a wasted effort and results in extra costs if you have drafts in your home. In addition to windows and doors, you should also seal any folding attic stairs, add a fireplace plug to seal the damper and install a dryer vent seal to reduce drafts in your laundry room.
• Swap to LEDs: Most of us are already using LED bulbs throughout our home. If you aren’t yet, now is the time to make the switch! LED bulbs use 15% less energy than an equivalent incandescent, which can save you a ton of money each month especially in larger homes.
• Turn Down Your Water Heater: While sometimes nothing beats a good scalding shower, you don’t want to be burned with a high energy bill. Did you know if you knock down that temperature gauge by just 10 degrees, you can save 3% to 5% on your bills each month!?
• Examine Your Appliances: Since 1992, ENERGY STAR® has been backing energy efficient appliances and products, helping consumers make the right choices. Some of the least green appliances in your home are your dishwasher, washing machine, dryer and refrigerator and, if you don’t currently have Energy Star certified versions of these machines, swapping to them is a surefire way to reduce your monthly expenses.

  Can’t afford new appliances? Here are some other tips and tricks to help make them more efficient in the meantime:

  • Dishwasher: Use a citric acid-based cleaner in an empty cycle to rid your dishwasher of excess soap and calcium buildup that may be causing your machine to work harder.
  • Washing Machine: Maximize energy by stuffing your machine to the brim whenever possible as washing machines typically use the same amount of energy regardless of load size.
  • Dryer: For starters, ensure you are always cleaning out your lint filter to increase air circulation. In addition, keep an eye on the outside exhaust and clean when needed to reduce drying time and save energy.
  • Refrigerator: While most of us are more concerned with the food inside our fridges than the parts, it is important to check your condenser coils. Over time, dirt, food particles and dust can collect and reduce the efficiency. Another tip is to set your refrigerator to 2-3 degrees Celsius.
• Close The Blinds: When the temperature starts heating up, it is important to close the blinds and drapes to prevent the sun from beating in and warming up your home. The excessive heat makes your air conditioner work overtime causing your energy bills to skyrocket.

In addition to the cost savings and environmental benefits of improving your energy efficiency, CMHC also has a rebate available! The CMHC Eco Plus refund can provide a 25% partial premium refund if you’re CMHC insured and buying or building an energy-efficient home! Click here for more details.

Economic Insights from Dr. Sherry Cooper

All eyes were on The Bank of Canada last month as they cut interest rates by 25 basis points again during their July 24th meeting, thereby taking the overnight policy rate down to 4.5%.

We believe that owing to a sustained deceleration in inflation, the central bank will continue its monetary easing at the September and December meetings and well into next year.

The policy rate will likely fall to 2.75% next year, reducing the burden of higher monthly mortgage rates on renewals in the next 18 months.

The influx of roughly 2 million immigrants to Canada has raised overall consumer spending, averting a recession this year, but GDP per capita continues to decline.

Labour markets continue to soften as job vacancies have fallen sharply, and the jobless rate has risen from 4.9% to 6.4%. The latest business and consumer surveys have suggested that inflation expectations have fallen and wage inflation—a lagging indicator—will soon decline. Companies expect to cut their spending on machinery and equipment, and commercial real estate valuations have fallen owing to the sharp rise in office vacancy rates.

Housing market activity has slowed with the run-up in interest rates from March 2022 until June 2024. Lower interest rates will spur transactions and increase new listings next year. Housing affordability will improve as price pressures remain muted. The housing shortage, however, will likely mitigate the improvement, particularly as the shortage of experienced construction workers impedes rapid housing supply increases.

Welcome to the July issue of my monthly newsletter!
Things are starting to heat up as we head into July! For those first-time buyers looking to purchase a home, I have all the details for you below! For those other homeowners hoping to stay cool and enjoy their spaces this season, scroll down for tips on how to turn your backyard into a staycation paradise! Have a great summer!

Entering the Housing Market

With the first Bank of Canada rate drop having occurred in June, many individuals are looking at the housing market with renewed vigor and an expectation that rates will continue to come down to a more sustainable level.

If you are someone who is considering entering the housing market this summer, there are a few things you should keep in mind:

With the first Bank of Canada rate drop having occurred in June, many individuals are looking at the housing market with renewed vigor and an expectation that rates will continue to come down to a more sustainable level.

If you are someone who is considering entering the housing market this summer, there are a few things you should keep in mind:

Determine Your Budget: Download my app from Google Play or the Apple iStore to help you calculate mortgage payments, affordability, the income required to qualify, and even estimate your closing costs! It also allows you to connect directly with me through the app so that I can answer any questions you have right in the palm of your hand.

Save For a Down Payment: Your typical down payment should be at least 5% of the purchase price, though 20% down is preferable as anything below that requires default insurance.

• Thanks to the Federal Government’s Home Buyer’s Plan, first-time homebuyers can leverage up to $60,000 from their RRSPs (maximum of $120,000 for a couple).

PRO TIP: The First Home Savings Account (FHSA) is specifically designed to help first-time homebuyers save for their down payment without having to pay taxes on the interest earned on their savings.

Take Advantage of First-Time Buyer Programs: Did you know? First-time home buyers are eligible for an exemption, reducing the amount of property transfer tax paid, depending on the property’s value.

• PRO TIP: In addition, Ontario, British Columbia, Prince Edward Island, and the City of Toronto offer land transfer tax rebates for first-time homebuyers.
• Get Pre-Approved: This means that a lender has stated (in writing) that you qualify for a mortgage and what amount, based on submitted documentation of your current income and credit history. A pre-approval usually specifies a term, interest rate, and mortgage amount and is typically valid for a brief period, assuming various conditions are met.

There are a few benefits to pre-approval such as:

• It confirms the maximum amount you can afford to spend.
• It can secure you an interest rate for 90-120 while you shop for your new home

It lets the seller know that securing financing should not be an issue. This is extremely important for competitive markets where lots of offers may be coming in.

Understand the Closing Costs: Closing costs are a one-time fee associated with the sale of a home and are separate from the mortgage insurance and down payment. Typically, these costs range from 1.5-4% of the purchase price, depending on your location. Factoring these costs into your maximum budget can help you narrow down an entirely affordable home and ensure future financial stability and security.

Here are a few closing costs to keep an eye out for:

• Land Transfer Tax: This is calculated as a percentage of the purchase price of your home, with the amount varying in each province. Some cities, such as Toronto, also have a municipal LTT.
• Legal Fees and Disbursements: You can expect to incur a minimum of $500 (plus GST/HST) on legal fees for the preparation and recording of official documents.
• Title Insurance: Most lenders require title insurance to protect against losses in the event of a property ownership dispute. This is purchased through your lawyer/notary and is typically $300 or more.
• PST on CMHC Insurance: Though CMHC insurance itself is financed through the mortgage, PST on the insurance is typically paid at the lawyers and sometimes deducted from your advance.
• Home Inspection Fee: A home inspection is highly recommended as a condition of your Offer to Purchase to prevent any future surprises. This can cost around $500.
• Appraisal Fee: An appraisal is performed to certify the lender of the resale value of the home in the case you default on the mortgage. The cost is usually $400 – $600 but is typically covered by the lender.
• Property Insurance: Property insurance covers the cost of replacing your home and its contents, and must be in place on closing day. This is paid in monthly or annual premiums.
• Prepaid Utility Bills: You may need to reimburse the previous owner of your property for prepaid costs such as property taxes, utilities, and so forth.
• Property Taxes: Property taxes are due on an annual basis and are calculated as a percentage of the home value and vary by municipality. You also may need to reimburse the previous property owner if he/she has already paid property taxes for the full year.

Getting Proper Coverage: Purchasing a home is likely the largest investment you will make, and you want to ensure it is protected.

Various insurance items can be obtained for your home, including:

• Title Insurance: Required by most lenders to protect against losses should a property ownership dispute arise. This insurance is done through your lawyer/notary and typically runs $100-$300.
• Mortgage Protection Insurance: An optional debt replacement that protects your family should anything happen in the future. Many homeowners believe they are covered through their life insurance policy, but the Manulife Mortgage Protection Plan is different. Before closing, it’s important to look at the costs and coverage for you!
• Property & Fire Insurance: Mandatory and needs to be arranged before your closing appointment. Not sure how much to budget for? Get quotes from various insurance companies! Your lawyer/notary or myself can provide recommendations
• Default Insurance: Only required if you purchase a house with less than a 20% down payment

Whether you’re looking at a condo, townhouse, rancher, or a two-story property, there is nothing quite like your first home! However, the mortgage process can be intimidating – and that’s where I come in! If you’re looking to get started on your home-buying journey, don’t hesitate to reach out to me today.

5 Ways to Turn Your Home into a Staycation Paradise

We all invest a lot into our homes, so we want to make sure we are enjoying them to the fullest all year long.  As we head into the prime of summer, there is no better time to update your space to turn it into the perfect staycation paradise so that you can fully enjoy the season!

Here are my top 5 tips for creating that backyard oasis:

1. Expand Your Outdoor Entertaining Area: Take your outdoor space to the next level by adding amenities for entertaining. Consider installing an outdoor kitchen or bar area complete with a grill, refrigerator, and seating area. Adding a pergola or canopy can provide shade and shelter, while outdoor speakers and a fire pit create ambiance for evening gatherings under the stars.
2. Incorporate Relaxation Zones: Create multiple relaxation zones throughout your home to cater to different activities and moods. Designate a cozy corner with plush seating and soft lighting for reading or meditation. Set up a hammock or hanging chair in the backyard for afternoon naps or stargazing. Incorporate a spa-like bathroom retreat with a luxurious bathtub, candles, and soothing music for a pampering escape.
3. Embrace Indoor-Outdoor Living: Maximize the connection between your indoor and outdoor spaces to blur the boundaries and create a seamless flow. Install sliding glass doors or folding patio doors to open up your living areas to the backyard, allowing for easy access and natural ventilation. Arrange indoor furniture to face outdoor views and encourage indoor-outdoor socializing.
4. Infuse Tropical Vibes: Bring the vacation vibes home by incorporating tropical elements into your decor. Add pops of vibrant colors, tropical patterns, and lush greenery throughout your home. Hang palm leaf or bamboo curtains, display tropical fruits in bowls, and accessorize with seashells and driftwood for a breezy, island-inspired ambiance.
5. Curate Outdoor Activities: Make the most of your outdoor space by curating a variety of activities to enjoy during your staycation. Set up a mini-golf course, bean bag toss, or giant Jenga for backyard games. Create a movie night under the stars with a projector and outdoor screen. Arrange a DIY spa day with facials, massages, and foot baths for a rejuvenating retreat at home.

By incorporating these ideas into your home and yard, you can transform your space into a paradise that grants you relaxation, entertainment, and rejuvenation all summer!

Economic Insights from Dr. Sherry Cooper

The Bank of Canada finally began an easing cycle on June 5, taking their overnight policy rate down 25 bps to 4.75%–the first major central bank to do so. The housing market has languished over the past year with extremely weak affordability.

The Multiple-Listing Service Home Price Index fell again in May and is now down 2.4% year-over-year and is off 14.4% from the early 2022 peak when the overnight rate was a mere 25 basis points. Average transaction prices are down 4% y/y and off nearly 15% from the high.

Except for Calgary, housing markets across the country are in a buyers’ market as inventories of active listings have risen and sales have slowed. Calgary prices were up just under 10% y/y in May, pushing new record highs by the month. In the meantime, Vancouver, Toronto, and Montreal prices are all flat or down from a year ago, and they are still tucked below the levels seen at the early 2022 high.

The significant drivers in Calgary’s outperformance have been more substantial population growth (juiced by interprovincial inflows), better affordability, and valuations that might make some sense for investors.

Even with their lackluster performance since the Bank of Canada began hiking interest rates in March 2022, home prices are still high, having tripled in the past two decades, posting an average 5.7% annual rise, while inflation averaged only 2.2% per year over the same period.

Moreover, the total return on the Toronto Stock Exchange over the same period has been much higher still, averaging 7.9% annually over the past two decades. Despite the recent mini selloff in stocks, the TSX has boasted a more robust return than housing over time. And the US stock market has significantly outperformed the TSX.

Of course, there are significant differences between these two asset classes. Stocks are passive investments that do not provide a place to live or require repairs and maintenance. Housing is more than just a financial investment; it is a lifestyle choice that provides the necessary shelter.

The Bank of Canada will continue to lower interest rates as inflation reaches its 2% target. We expect the overnight rate to fall to about 3% by the end of the easing cycle. But even with only one quarter-point rate cut, bond yields have already fallen significantly in anticipation.

Many mortgage lenders, including three of Canada’s Big Six banks, are slashing fixed mortgage rates, a welcome development for those facing renewal in the coming months. Lenders have already started trimming rates in the wake of a nearly 40-basis-point drop in bond yields, which typically leads fixed mortgage rate pricing.

Over 70% of outstanding mortgages will be renewed within two years. Falling mortgage rates could help soften the payment shock expected for the estimated 2.2 million mortgages that will be renewing at higher rates in the next two years.

But just because rates are falling doesn’t mean all lenders will offer equally low rates in their renewal letters. Typically, they don’t just hand out their especially low rates. That’s where a mortgage broker provides real value, educating borrowers about alternative options, which can be used to haggle a better rate even if they decide not to switch lenders.

For insurable mortgages, the borrower does not need to re-qualify when switching lenders. However, for uninsured mortgage switches, OSFI head Peter Routledge recently rejected renewed calls to remove the mortgage stress test for federally regulated lenders. Knowing your options to improve your bargaining power with your existing lender still pays.

There is a record number of resale condos on the market, and new construction is at a record high. While there remains a longer-term shortage of affordable housing for rent and purchase, it will probably be another year before markets equilibrate and sellers have the advantage.  Housing activity has likely bottomed and will increase as interest rates fall.

If you’d like to be added to my distribution list, send an email to mike.bohte@dominionlending.ca