Bank of Canada increases key interest rate - March 2, 2022

This morning, the Bank of Canada has announced that they have increased its key interest rate by 0.25%. Therefore, for those who have a variable rate credit product, payments may increase by approximately $11.77 for every $100,000.00 loan.

The current invasion of Ukraine by Russia is a large factor causing uncertainty. Oil prices have increased, adding to inflation around the world.

Canada's economic growth was very strong in the fourth quarter of 2021, at 6.7%. This is much stronger than what the Bank has predicted, hence the high inflation.

The recovery from Omicron is happening quicker than expected, and so consumer spending should increase as public health restrictions are lifting. Housing market activity is also elevated, adding more pressure to housing prices. However, there is still some uncertainty as there could be another variant.

Omicron is expected to be less severe than previous waves, so economic growth will remain healthy over the near future.

Inflation is currently at 5.1%, well above the bank's target rate of 2%. The invasion of Ukraine is putting further upward prices for energy and food-related commodities. Elevated inflation increases the risk that longer run inflation could also drift upwards. The bank plans to use monetary tools to return inflation to 2%, by increasing rates and implementing quantitative tightening.


Linx - Vancouver East
Linx is a new condo development by Lotus Capital and Omicron currently in preconstruction at 2268 East Broadway, Vancouver. The development is scheduled for completion in 2024. Linx has a total of 54 units.
At Linx, your backyard is connected to everything that makes this part of the world a vibrant and colourful place to call home. Shopping, restaurants, parks, art—access it all. In minutes, you can turn your city-life adventure into a country escape with the SkyTrain Interchange Station offering easy access to both the Expo and Millennium Line, the Central Valley Greenway, and Highway 1.
Linx公寓是Lotus Capital and Omicron 公司聯手開發的溫東6層公寓,提供1-3臥室都市公寓。面積442-1076平方尺的1-3臥室單位工54套,其中,1臥室+書房單位28套,2臥室+書房單位20套,3臥室單位6套,所以戶型均帶有車位,定金15%,預計2024年冬季交付。
該項目明天(2022年2月24日)開始預覽。 1臥室+書房單位65萬起,2臥室+書房單位90萬起,3臥室單位110萬起。
在Linx 公寓,您家後院就有溫哥華東區五光十色的都市生活圈和溫哥華創新設計歐洲社區-Grandview 社區,獨特的社區氛圍,購物,公園,餐飲,藝術應有盡有,2條天車線從家門附近經過,步行7分鐘即可到達天車站,便利無出其右。
屋頂花園, 設有戶外燒烤區,篝火休閒區,私家花園和兒童遊戲區。2層地下停車場,全部戶型均配有車位,還有108個自行車位,配有直通自行車房的專用電梯。廚房採用歐洲Fulgor Milno 廚房電器,Bloomberg 一體式洗碗機等。

 NUVO in Metrotown Burnaby

Welcome to NUVO in Metrotown

Want to live or invest in Metrotown? Nuvo is offering some of the lowest prices in the Metrotown/ Brentwood area compared to other presale properties! 

This 44 story project will have 358 units ranging from studios - townhomes. Incredible location right across from skytrain, Central Park, dining and shopping! Over 7000+ sqft of amenity space including fitness centre, sauna, games room, multiple lounges, bbq area, play area and more!

As the best VIP group, our guests will get up to 3% off their unit and exclusive assignment rates. Deposit only 15% for 2-3 bedroom, 20% for 1 bedrooms.

Message me to get VIP early access and information about this project as it comes out! 


Banking Regulator Aims To Make It Tougher To Get An Uninsured Mortgage
With several Big-Five bank CEOs calling for regulatory action to slow the red-hot housing market, it didn't take long for the Office of the Superintendent of Financial Institutions (OSFI), the governor of federally regulated financial institutions, to respond. In a news release issued today, OSFI proposed an increase in uninsured mortgages' qualifying rate to the higher of the mortgage contract rate plus 200 basis points or 5.25% as a minimum floor.

Based on posted rates of the country’s six largest lenders, the current threshold is at 4.79%. Before the pandemic, the posted rate was widely considered too high relative to much lower contract rates. Remember, Canada's six largest lenders under OSFI's jurisdiction set the posted rate each week when they submit to the Bank of Canada the so-called 'conventional 5-year mortgage rate'. It has increasingly born little relationship to actual contract rates.

OSFI, once again, shows itself to cozy up to the Canadian banking oligopoly. Keep in mind that delinquency rates on the Canadian banks' mortgage books are very low--both in historical terms and compared with financial institutions in the rest of the world.

In the release, OSFI said, "The minimum qualifying rate adds a margin of safety that ensures borrowers will have the ability to make mortgage payments in the event of a change in circumstances, such as the reduction of income or a rise in mortgage interest rates. As mortgages are one of the largest exposures that most banks carry, ensuring that borrowers can repay their loans strongly contributes to the continued safety and soundness of Canada’s financial system."

The comment period ends on May 7. OSFI reported that they would communicate the revised B-20 Guideline by May 24, with an implementation date of June 1, 2021.

This all but ensures that the current boom in home buying will accelerate further in the spring market--providing an impetus for borrowers to get in under the June 1 deadline. OSFI's move will trigger an even hotter spring housing market as demand is pulled forward just as it was before the January 1, 2018 implementation date of the current B-20 ruling.

This will not impact non-federally regulated FI's such as credit unions, mono-lines and private lenders, nor does it immediately impact insured-mortgage borrowers.

The federal government is in charge of mortgage qualification for insured mortgages. CMHC and the finance department could well follow OSFI's lead in tightening qualifying rules for insured loans.

April 2021 Mortgage rate
The market is still very hot with people over bidding and properties having multiple offers. We also heard Bank of Canada's announcement confirming that they will not be increasing rates until January 2023. If this continues, prices will continue to go up due to the low rates.

Things are definitely getting busy around here with spring around the corner but we're looking forward to better weather and sunnier days!


Banks and credit unions

5 yr variable starting at 1.35%
5 yr fixed starting at 2.14%


Starting at 2.54% + 1% fee

Private lenders

Starting at 4.95% + 2% fee.

*Rates may change without notice. Subject to approval.
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