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Canadians appear to be feeling pretty good about their personal finances as we head into the sixth month of disruptions and restrictions caused by the coronavirus. A recent poll by the Angus Reid Institute suggests 80% of Canadians rank their financial situation as “good” or “great”.  Back in April that number was 73%. However, on the other side, a significant group of about 20% call their circumstances “bad” or “terrible”.  That number climbs to 30% among those who are receiving Employment Insurance or CERB payments. The pollsters describe the overall situation as “improving but fragile”. The caution among consumers becomes clear when their buying intentions are analyzed.  Regardless of how they feel about their finances, 56% do not see the next 12 months as a [...]

In a sign that the economic tide is turning, Canada’s inflation rate moved higher in June.  Statistics Canada puts the annual inflation rate at 0.7% for the month.  That is more than double the 0.3% rate forecast by economists, and it is a significant reversal of the 0.4% drop in inflation in May and the 0.2% decline in April. Most of the increase came through higher prices for cars, clothing, energy and food. While runaway price increases are bad, moderate, reliable inflation is good.  It encourages spending and keeps money flowing through the economy.  Deflation – particularly if it persists – is bad because consumers tend to stop spending, knowing that they will be able to make their purchases later for less.  That keeps money [...]

Things are looking up, a little, as Canadians navigate through the COVID-19 pandemic.  The latest measure of confidence delivered by Bloomberg and Nanos Research suggests Canadian consumers are feeling better about the economy, the recovery and home prices. The confidence index has been on a steady rebound, climbing for seven consecutive weeks, since plunging to record lows in April.  In the latest survey it stands at 42.86, up nearly 3 points from the previous tally.  (The surveys averaged 57 in the year before the pandemic.) The survey suggests Canadians increasingly feel that the worst of the pandemic-induced downturn is over, but the pessimists still outnumber the optimists by more than three-to-one.  About 20% of those surveyed feel the economy will be stronger in six months [...]

Housing starts rose from 166.5K in April to 193.5K in May (seasonally adjusted and annualized). Urban starts improved 22K to 181.1K on increases in both the multi-unit (+14.9K to 135.9K) and the single-detached (+7.1K to 45.3K) segments. At the provincial level, urban starts shot up in Quebec from 0K in April to 56.3K as social distancing measures were eased but plunged 37.1K to 56.5K in Ontario. June results should provide a clearer snapshot of the post-lockdown residential construction industry in Canada. Projects delayed on account of the Covid-19 pandemic might sustain starts at a relatively high level for a short while but the longer-term horizon looks less promising in light of much higher joblessness and reduced immigration. Moreover, tougher CMHC standards for mortgage insurance will [...]

April 20th Premier Kathleen Wynne announced a comprehensive package of housing reforms, ahead of the provincial budget aimed at cooling the GTA housing market. The release can be found here. The announcement follows extensive media coverage about the serious concerns with the over-heating markets. Mortgage Professionals Canada has been engaged with the Ontario government and many MPPs through our lobbying activities and our recent Queen’s Park Advocacy Day. We are pleased to see measures that will increase supply, improve data collection and curb speculation within the market place, which we have been asking the government to do. However, we are disappointed that there is no additional support for first-time buyers in this package, and we suggest caution that a foreign buyer tax will not have [...]

Get a head start on decluttering, organizing and simplifying your life with these tasks you can complete in just a couple of days. The one year rule. Pick an area in your home — your closet, cupboards or bookcase — and apply the one year rule. If you haven't worn it or used it in any way over the last twelve months, donate or toss it. You can make an exception for souvenirs or sentimental items. Organize your entertainment. Sort your books, magazines, DVDs, records, and games in a way that makes sense for everyday use. Put those for the kids on lower shelves for easy access, and sell or donate any they (or you) have outgrown. Monitor expiry dates. Check your medicine cabinet, beauty [...]

The flowers are blooming, the birds are singing and our homes have a bad case of the winter blues. “Spring cleaning” is a tradition that serves a very useful purpose - it rids your home and exterior property of build-up left from the winter months. “The winter season brings a lot more headaches than just bitter cold weather and snow,” says Glenn Cooper of Aviva Insurance. “Many side-effects of winter are noticed when spring comes along. It's important to take care of those problems before they lead to serious property damage.” Cooper offers four simple tips to help make exterior spring cleaning a breeze this year: 1. Inspect your property: Frozen ground can cause shifts in your landscaping and patios. If left unattended, it can [...]

The trend measure of housing starts in Canada was 199,834 units in January compared to 197,881 in December, according to Canada Mortgage and Housing Corporation (CMHC). The trend is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts. CMHC uses the trend measure as a complement to the monthly SAAR of housing starts to account for considerable swings in monthly estimates and obtain a more complete picture of the state of Canada’s housing market. In some situations analyzing only SAAR data can be misleading, as they are largely driven by the multi-unit segment of the market which can vary significantly from one month to the next. The standalone monthly SAAR for all areas in Canada was 207,408 units in [...]

We’re in full RRSP season and many Canadians wonder what the best option is between lump-sum payments every winter and monthly withdrawals. Contributing to you RRSP has several advantages: aside from the obvious retirement savings, RRSP contributions are deductible and can be used to reduce your tax. An RRSP also gives you a certain degree of flexibility in your financial future, and you can tap into your RRSP for the Home Buyers' Plan that gives first-time home buyers the opportunity to withdraw up to $25,000 for their down payment. Both options (lump-sum or recurrent) work to contribute to your RRSP, but regular deposits are definitely preferred. Contributing regularly forces you to save every month, and you can also set up a pre-authorized withdrawal from your [...]