25 Feb

#becauseofyou

General

Posted by: Jeannie Stace-Smith

Government of Canada launches #BecauseOfYou campaign for International Women’s Day to honour trailblazers in women’s rights Français


NEWS PROVIDED BY

Women and Gender Equality Canada

Feb 24, 2020, 10:32 ET


OTTAWA, Feb. 24, 2020 /CNW/ – Today, the Honourable Maryam Monsef, Minister for Women and Gender Equality and Rural Economic Development, launched the Government of Canada’s campaign for this year’s International Women’s Day, Because of You. Featuring 9 Canadian trailblazers, including athlete Christine Sinclair, businesswoman Ann Devine, and Nobel Prize Laureate Dr. Donna Strickland, the campaign will profile those who are making the world a better place by challenging cultural and societal norms, amplifying the voices of women and girls, and breaking barriers in their respective fields.

International Women’s Day, which takes place every year on March 8, is a time to recognize the outstanding contributions of all women and an opportunity to promote and support gender equality. This year’s theme, Because Of You, celebrates activists, advocates and other changemakers, across generations past and present, who are advancing gender equality and the rights of women. Because of them, our country is changing for the better. Canadians from coast-to-coast-to-coast are encouraged to use the hashtag #BecauseOfYou to name, honour and celebrate women in their lives and communities whose work and impact inspires them.

Quote

“International Women’s Day is a time to recognize the outstanding achievements and contributions of women and girls who have helped create a better world. It has been 25 years since the Beijing World Conference on Women, providing an opportunity to take stock and reflect on the work ahead and to celebrate those whose efforts have made our country and the world better. The only way to move forward is to remember where we came from and those who brought us here. This year’s theme, Because Of You, asks everyone in Canada to honour the role models in their own lives. I encourage all Canadians to take part and recognize the incredible impact of the women making change in their communities.”

The Honourable Maryam Monsef, P.C., M.P.
Minister for Women and Gender Equality and Rural Economic Development

Quick Facts

  • The beginnings of International Women’s Day trace back to the early twentieth century, emerging from the activities of labour movements in North America and Europe and reflecting a growing movement for women to participate equally in society.
  • The first International Women’s Day was observed on March 19, 1911, in Austria, Denmark, Germany and Switzerland. That day, more than one million people showed their support by participating in public events. In the years that followed, other countries began to observe and celebrate this day.
  • The United Nations recognized 1975 as International Women’s Year and began celebrating International Women’s Day on March 8 of that year.
  • Today, International Women’s Day is celebrated around the world – in many countries, it is a national holiday. It has grown to become a global day of recognition of women’s achievements and a call to action to support women’s rights and advance gender equality.
  • Canada hosted the Women Deliver 2019 Conference from June 3 to 6, 2019, in Vancouver, British Columbia. Held every three years, it is the world’s largest gathering on gender equality and the health, rights and well-being of women and girls.
  • At Women Deliver, Minister Monsef announced that the Government of Canada is reshaping how it supports women’s rights organizations, domestically and internationally, to build a legacy for gender equality and rights.
  • The Equality Fund will not only create a sustainable and predictable source of funding for women’s rights organizations and movements in developing countries, but will also shift how investment decisions are made for gender equality outcomes: by providing resources directly to women’s rights organizations and by making investments that support gender equality. The Equality Fund has mobilized initial investments of $100 million as a result of the Government of Canada’s initial $300 million commitment. The Equality Fund will also mobilize funding for women’s rights organizations in Canada.

SOURCE Women and Gender Equality Canada

For further information: Alex Howell, Director of Communications, Office of the Minister for Women and Gender Equality and Rural Economic Development, 613-862-7245; Media Relations, Women and Gender Equality Canada, 1-855-969-9922

18 Feb

Amazing news on the mortgage front!!!!

General

Posted by: Jeannie Stace-Smith

Breaking news and so needed!!!!  Call or message me for some advice…403-968-5779!

18 FEB 2020

MORNEAU EASES STRESS TEST ON INSURED MORTGAGES

Minister Morneau Announces New Benchmark Rate for Qualifying For Insured Mortgages

The new qualifying rate will be the mortgage contract rate or a newly created benchmark very close to it plus 200 basis points, in either case. The News Release from the Department of Finance Canada states, “the Government of Canada has introduced measures to help more Canadians achieve their housing needs while also taking measured actions to contain risks in the housing market. A stable and healthy housing market is part of a strong economy, which is vital to building and supporting a strong middle class.”

These changes will come into effect on April 6, 2020. The new benchmark rate will be the weekly median 5-year fixed insured mortgage rate from mortgage insurance applications, plus 2%.

This follows a recent review by federal financial agencies, which concluded that the minimum qualifying rate should be more dynamic to reflect the evolution of market conditions better. Overall, the review concluded that the mortgage stress test is working to ensure that home buyers are able to afford their homes even if interest rates rise, incomes change, or families are faced with unforeseen expenses.

This adjustment to the stress test will allow it to be more representative of the mortgage rates offered by lenders and more responsive to market conditions.

The Office of the Superintendent of Financial Institutions (OSFI) also announced today that it is considering the same new benchmark rate to determine the minimum qualifying rate for uninsured mortgages.

The existing qualification rule, which was introduced in 2016 for insured mortgages and in 2018 for uninsured mortgages, wasn’t responsive enough to the recent drop in lending interest rates — effectively making the stress test too tight. The earlier rule established the big-six bank posted rate plus 2 percentage points as the qualifying rate. Banks have increasingly held back from adjusting their posted rates when 5-year market yields moved downward. With rates falling sharply in recent weeks, especially since the coronavirus scare, the gap between posted and contract mortgage rates has widened even more than what was already evident in the past two years.

This move, effective April 6, should reduce the qualifying rate by about 30 basis points if contract rates remain at roughly today’s levels. According to a Department of Finance official, “As of February 18, 2020, based on the weekly median 5-year fixed insured mortgage rate from insured mortgage applications received by the Canada Mortgage and Housing Corporation, the new benchmark rate would be roughly 4.89%.”  That’s 30 basis points less than today’s benchmark rate of 5.19%.

The Bank of Canada will calculate this new benchmark weekly, based on actual rates from mortgage insurance applications, as underwritten by Canada’s three default insurers.

OSFI confirmed today that it, too, is considering the new benchmark rate for its minimum stress test rate on uninsured mortgages (mortgages with at least 20% equity).

“The proposed new benchmark for uninsured mortgages is based on rates from mortgage applications submitted by a wide variety of lenders, which makes it more representative of both the broader market and fluctuations in actual contract rates,” OSFI said in its release.

“In addition to introducing a more accurate floor, OSFI’s proposal maintains cohesion between the benchmarks used to qualify both uninsured and insured mortgages.” (Thank goodness, as the last thing the mortgage market needs is more complexity.)

The new rules will certainly add to what was already likely to be a buoyant spring housing market. While it might boost buying power by just 3% (depending on what the new benchmark turns out to be on April 6), the psychological boost will be positive. Homebuyers—particularly first-time buyers—are already worried about affordability, given the double-digit gains of the last 12 months.

DR. SHERRY COOPER
Chief Economist, Dominion Lending Centres
5 Feb

Exciting news- TD lowers qualifying rate!

General

Posted by: Jeannie Stace-Smith

Exciting news!  Let’s see if the other banks follow!

TD LOWERS QUALIFYING MORTGAGE RATE 35 BPS TO 4.99%

CANADIAN QUALIFYING MORTGAGE RATE LOWERED TO 4.99%

Market interest rates have fallen sharply since the coronavirus-led investor flight to the safety of government bonds. The 5-year government bond yield–a harbinger of conventional mortgage rates–now stands at 1.34%, down sharply from the 1.60+% range it was trading in before the virus became global news (see chart below).

This morning, one of the Big-Six banks finally reacted. TD cut its posted 5-year fixed rate to 4.99%. TD’s posted rate had previously been at 5.34%, making this a 36 basis point cut. Other banks had lowered their qualifying rate to 5.19% last July, leading the Bank of Canada to cut its 5-year conventional mortgage rate to 5.19%. This is the qualifying rate under the B-20 rule introduced on January 1, 2018.

Even the regulators have been questioning the efficacy and fairness of using the big-bank posted rate as a qualifying rate for mortgage stress testing.

On January 24, the Assistant Superintendent of OSFI’s Regulation Sector, Ben Gully, gave a speech at the C.D. Howe Institute suggesting that the B-20 qualifying mortgage rate historically would be no more than 200 basis points above contract rates. He said that OSFI chose the “best available rate at the time.”

He went on to say that for many years, the difference between the benchmark rate and the average contract rate was 200 bps. However, this gap “has been widening more recently, suggesting that the benchmark is less responsive to market changes than when it was first proposed. We are reviewing this aspect of our qualifying rate, as the posted rate is not playing the role that we intended. As always, we will share our results with our federal partners. This will help to inform the advice OSFI might provide to the Minister, as requested in the mandate letter to him.

By keeping posted rates too high, the Big-Six banks have inflated the qualifying rate, making it more difficult than necessary to pass the stress test to get a mortgage.

While TD’s rate cut is welcome news, its posted rate is still too high by historical standards. Given today’s average contract rates, the posted rate should be at least 20 bps lower still.

Banks have a strong incentive to inflate their posted mortgage rate. For one thing, they are the basis for the calculation of big-bank mortgage penalties. Also, they are the minimum qualifying rate.

The posted rate does not appropriately reflect the state of the mortgage market as few borrowers would pay this rate. Interestingly, banks often move this rate in lock-step, or close to it, reflecting their dominant oligopolistic position in the marketplace.

If a couple of the other big banks follow TD’s lead, the Bank of Canada benchmark rate will be below 5% for the first time since January 2018 when the new B-20 rules were adopted. Lowering the stress test rate by 20 bps from 5.19% to 4.99% would require roughly 1.8% less income to qualify for a mortgage on the average Canadian home price (assuming a 20% downpayment), increasing buying power by 2%. This doesn’t sound like much, but it can have a meaningful psychological impact on already improving housing markets. The latest CREA data shows that the national average home price surged 9.6% year-over-year in December. A lower stress test rate would make a busy spring housing market even more active.

DR. SHERRY COOPER
Chief Economist, Dominion Lending Centres
3 Feb

Rates dropping due to Corona Virus!

General

Posted by: Jeannie Stace-Smith

This is how interconnected the world is!

INTEREST RATES PLUNGE ON CORONAVIRUS NEWS; BOC BUYS 10-YEAR CMBS; FTHBI PLAN FLOPS

Canadian 5-year Yield Fell To Lowest Level Since October

Global investors are selling stocks and piling into the safety of bonds in response to fears that the Wuhan coronavirus could disrupt global economic activity. Gold prices, another haven, have also risen. The Government of Canada 5-year bond yield traded this morning at roughly 1.35%, well below its nearly 1.70% level one month ago. The 5-year yield leads fixed mortgage rates, so if this trend persists, we might see widely available fixed-5-year rates in the 2.50% range once again in February.

 

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Bank of Canada Now Buying 10-year CMBs
The Bank of Canada announced yesterday that effective immediately, the Bank will expand the Canada Mortgage-Backed securities (CMBs, which are government-guaranteed) it can purchase in the primary market to include 10-year fixed-rate bond issues. In 2018, The Bank expanded the assets it acquires to 5-year fixed and floating CMBs. The Bank held $517 million of these 5-year CMBs as of November 30, 2019.

This move by the BoC should improve liquidity, reducing yields on 10-year CMBs, possibly lowering 10-year fixed rates for mortgage borrowers. Governor Poloz supports efforts to extend the duration of mortgages.

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First-Time Homebuyers Incentive Plan Flops

Only about 3,000 applicants were approved for the Liberals’ First-Time Home Buyer Incentive (FTHBI) in 2019. That’s just $55 million in funding, a less-than-stellar start given its $1.25-billion three-year target. (This information is according to attendees at the TD Securities’ Financial Services Conference where CMHC made comments.)

DR. SHERRY COOPER
Chief Economist, Dominion Lending Centres
Sherry is an award-winning authority on finance and economics with over 30 years of bringing economic insights and clarity to Canadians.