Average price of BC home up 15% from last year

(Vancouver Sun April 18th) The average price of a home in British Columbia rose 15 per cent from March of last year to March 2011, the B.C. Real Estate Association reported in a news release today.

The BCREA release said Multiple Listing Service residential sales in the province were up 11.5 per cent compared to March of 2010.

Sales in March amounted to 8,600 units. The average price in March was $594,157.

"We continue to observe a two-speed market in BC, with surging consumer demand in Metro Vancouver overshadowing more moderate demand in other regions," Cameron Muir, BCREA chief ecconomist, said in the release.

"Vigorous consumer demand drove Greater Vancouver to its most active March since 2004, while the Fraser Valley had its strongest March in four years.

"Conversely, sales activity in other B.C. markets is expanding at a pace more inline with overall economic growth."

Surprise, surprise: Central Bank holds overnight rate at 1 per cent

Bank of Canada announced yesterday, it will maintain the overnight interest rate at 1%, which is a 3% bank prime rate. The key indicators for the rate hold, were strong Canadian economic recovery, the soaring loonie, global economic challenges and the disaster in Japan.

There is also indication that the bank will not raise rates at the next meeting on May 31st, instead it will be more likely to occur in July or September when the bank meets. This is great news for all you variable mortgage holders.

Click here to view the entire article form Mortgage Broker News

Top 25 grants and rebates for property buyers and owners

Great article outlining available Grants and Rebates that are available to homeowners so you can be sure you are getting all the grants that are available.

Click here to read the complete article in the Vancouver Sun

Bank of Canada keeps short-term rates low

The Bank of Canada is sticking to its low interest rate policy to continue to help the recovery, even though there is a lot of evidence that the economy is performing better than originally expected.

Most of the five-paragraph statement was devoted to highlighting that not much had changed and that the risks to the global recovery remain elevated. The bank also warned that the strong Canadian dollar and the poor productivity of Canadian firms will slow export growth.

On future intentions, the bank recycled a line used before that any tightening to monetary policy will need to be carefully considered.

The Bank of Canada has kept the overnight rate at 1% (bank prime 3%) since September 2010.

Click here to read the complete article from Julina Beltrame from the Canadian Press.

BoC may have to hold interest rates due to January inflation numbers

With gasoline prices up in January, and year over year price increases in seven of the eight major categories, it was a surprise to see inflation numbers drop in January. Overall consumer prices rose by .03% in January while inflation actually dropped .10 of a point to 2.3%

There is expectation, with the Bank of Canada’s next rate announcement coming on March 1st, that inflation will not be a cause for reactionary concern, making it harder for the BoC to raise the overnight rate.

Click here to read the full article from Property Wire

Interest rate hikes are coming.

Most of Canada's economist and securities dealers expect interest rates to start to rise as early as May. While we have been preparing for an rise in the Bank of Canada rate in July, recent data has suggested that it will happen as soon as May, and possibly in April.

When inflation hits the 2% benchmark number the next move is to raise interest rates to slow down consumer spending. January's inflation numbers came in under expectations at 2.3%, but job creation was 4 times what was projected, putting pressure on the BoC to start to raise interest rates.

The one certainty is not if rates will rise but when.

The next bank of Canada rate announcement is March 1st 2011.

Click here to read the complete article from the Vancouver Sun

RBC Reports: Mortgage rates to rise, but housing market to be stable over the next two years

RBC came out and reported that they expect the Bank of Canada to raise rates as much as 1% this year and 1.5% in 2012. A fairly bold statement, but the best news from the article is the positive statements made regarding the economic recovery.

“Going forward, we see nearly perfectly offsetting forces driving Canada’s housing market,” he said. “On the upside, the economic recovery will gather strength in 2011, continuing to boost employment and family incomes.

“Even though mortgage rates are expected to rise later this year, they will still be within short reach of current levels and remain supportive for housing market activity,” CREA chief economist Gregory Klump said. “Strengthening economic fundamentals will keep the housing market in balance, which will keep prices stable.”

Click here to read the complete article from The Globe and Mail.