Latest news with #PenelopeGraham
CTV News
3 days ago
- Business
- CTV News
Canadians deal with slowing economy, rising debt
Taking Stock With little sign of interest rates coming down in Canada, how are consumers holding up? Amanda Lang takes a look, by the numbers. Most mortgage holders will face an increase in costs in the year or two ahead - what is the ripple effect of those jumps? Amanda speaks with Penelope Graham, Head of Content at It's a bad time for a recession - with costs still high, and rates likely to stay put for now. Is it a 'perfect storm' for people in debt? Amanda talks it over with Wesley Cowan, Senior VP at MNP.
Global News
6 days ago
- Business
- Global News
Could falling rent prices be your stepping stone to home ownership?
Rents are falling across Canada and so are home prices, leading many Canadians to wonder if the time is right for them to make the jump from living in a rented home to home ownership. The average asking rent for all residential properties in Canada fell by 2.7 per cent in June, compared with this time last year, to $2,125 a month. Combined with a soft housing market, this could offer opportunities for anyone looking to become a homeowner. 'Current market conditions certainly offer an opportunity to get into the ownership market, if that's something you've been considering for a while,' said Penelope Graham, mortgage expert at 'Mortgage rates are softer than they've been (typically). They've come down considerably from the peak that they hit in the fall of 2023.' Recent Statistics Canada data suggests younger Canadians are also building up financial resilience, despite the economic uncertainty caused by U.S. President Donald Trump's tariffs. Story continues below advertisement 'The debt-to-income ratio is actually dropping for people under 35 from 201 per cent down to 187 per cent, suggesting it is a good time because incomes are finally outpacing debt. So that does give young people more room to plan for home ownership,' said Nicole Lechter, senior real estate analyst at RSM Canada. 'Middle-income Canadians are quietly rebuilding. There's a 20 per cent surge in net savings.' Royal LePage spokesperson Anne-Elise Cugliari Allegritti said that 'home prices are down nationally about three and a half per cent from the peak in Q1 of 2022.' 'Over that same period, salaries have gone up nationally, an average of almost 12 per cent. Canadians have this opportunity, especially in the more expensive markets that have historically been more difficult to get into,' she said. 1:58 New realtor trends emerging as housing market cools Down payment biggest challenge According to monthly affordability report, while mortgage rates went up in most Canadian markets last month, they still remain just over that four per cent mark. The interest rate for the average five-year fixed mortgage was 4.48 per cent, according to the report. Story continues below advertisement This means that for many Canadians, depending on where they rent and where they are looking to buy, their monthly mortgage cost could very well end up being lower than what they pay in rent. Despite the drop, rents remained 11.9 per cent higher than they were in June 2022 and 4.1 per cent higher than in June 2023. 'The truth is a lot of people who are renting can afford a mortgage. It's the same monthly outlay. If I'm paying an inflated $3,200 (per month in rent) for a condo, I could surely afford a mortgage of a similar amount. But in order to have that rent turned into a mortgage, I first need this big chunk of capital,' said Cindy Marquez, a certified financial planner who works with millennial clients looking to become homeowners. And for some, taking advantage of falling rent prices may offer a chance to save for that goal. 2:00 Business Matters: Canadian housing market on hold, CREA data shows Can you find cheaper rent? For the committed renter, there are cheaper rents to be found in certain markets. Story continues below advertisement Paying even a few hundred dollars a month less could help some people boost their savings and save up for that down payment. Get daily National news Get the day's top news, political, economic, and current affairs headlines, delivered to your inbox once a day. Sign up for daily National newsletter Sign Up By providing your email address, you have read and agree to Global News' Terms and Conditions and Privacy Policy 'It certainly can make financial sense, especially if it's just the couple and they don't have additional family members. If they have that flexibility, if you're downsizing from rental to rental, there's really nothing standing in your way there,' Graham said. Lechter said that 'renting isn't losing. It's a smart strategy.' She added that the demand on the rental market from heightened levels of immigration is easing. 'We're going to see further rent declines over the next 12 to 18 months. So that is a good opportunity to save,' she said. Being a renter, especially if your lease is month-to-month, can give you some flexibility in being able to move easily and find cheaper rent elsewhere. 'You're not going to pay any kind of penalties that you might if you owned your home and had to break your mortgage to do so. Downsizing the cost of living and boosting your ability to save will be beneficial if your goal is purchasing a home,' Lechter added. Marquez said she and her husband are currently renting a condo in Toronto, but they plan to move out of the city to pay less for rent. Story continues below advertisement 'We've given ourselves the benefit of paying less now so that we can save up more and get ready for that lead up (to home ownership),' she said. Lechter said condominium owners are feeling the pressure of the rental market, giving some power back to the renter. 'It's also an opportunity if you're a renter of a condo to go knock on your landlord's door and ask for a reduction in rent because you have some power here,' she said. 0:48 How many coffees you need to stop buying to afford a home in Ontario How much do you need to save? How much you save for your down payment can determine a lot. Story continues below advertisement 'It's going to be one of the key factors your lender is looking at. It's going to determine how much mortgage you're going to qualify for and your overall budget,' Graham said. 'If you're looking at purchasing a home at $1.5 million or more, you're going to need at least 20 per cent down. If you are a first-time homebuyer, though, you're likely at the lower end and saving up for that five per cent, or 7.5 per cent if you're looking at a property over $500,000,' she added. However, she said someone buying a home with less than 20 per cent down payment should consider the cost of mortgage insurance, which lenders require you to get if you don't meet the 20 per cent threshold. 5:32 Real estate: Spring outlook and 2025 home trends How to save for a down payment If you're able to save a few hundred dollars a month on rent, where should you squirrel those contributions away? Story continues below advertisement 'The First Home Savings Account (FHSA) is truly the best thing that we've had offered to us. You're getting the tax benefits of the RSP, where you get deductions on your contributions and the benefits of a TFSA. When you're making withdrawal from your FHSA for the purposes of buying or building a qualifying home, there are no taxable consequences,' Marquez said. The FHSA is a tax-free savings account that allows first-time buyers to save up to $8,000 a year to put toward their down payment. The time to open an FHSA is 'as early as possible,' Marquez said, but remember that you have a 15-year window to contribute to it. To open an FHSA, you need to be a Canadian citizen or permanent resident 18 years of age or older. You must also not have lived in a home that either you or your common law partner or spouse has owned for the last four years. However, if you became common law partners after you opened your FHSA, you will be able to withdraw that money tax-free for a down payment when you are buying a home. Marquez recommended maxing out the benefits of the FHSA and tax-free savings account (TFSA) before dipping into your registered retirement savings plan (RRSP), since that is money that you typically want to save for retirement. Story continues below advertisement 2:35 Frustrated and angry, Montreal condo buyers wait years for their units to be delivered Could you live in a condo? Canada's condominium market is in a major slump, with some of the most expensive markets in the country going ice-cold. In the Greater Toronto and Hamilton Area (GTHA), condo sale activity was down 91 per cent compared with the 10-year average in the second quarter of 2025, according to research from Urbanation. Story continues below advertisement Unsold inventory of condos has swelled to a record high in Q2, the report said. But for Canadians with families and pets, tiny one-bedroom condos with cramped living spaces are simply not an option. Lechter said one-bedrooms are not the only option on the condo market. There's one-bedroom, there's two-bedroom, there's three-bedroom condos,' she said. 'We're seeing more resilient demand for bigger-sized condos. We're also seeing that the purpose-built rentals that are coming back to the marketplace are gearing towards bigger units as well.' Allegritti said, 'I think that developers have really heard the need for larger units and we're going to start to see a lot more of that coming onto the market in years to come.'
CTV News
18-07-2025
- Business
- CTV News
Income required to buy a home in Ottawa increases $1,900: report
A new home is displayed for sale, in Ottawa on Tuesday, July 14, 2020. THE CANADIAN PRESS/Sean Kilpatrick The income required to buy a new home in Ottawa increased $1,900 in June, as home prices and mortgage rates jumped in the capital this summer. A new report from shows homebuyers needed an income of $135,960 to buy an average-priced home last month, up from $134,020 in May. The average income required to buy a home in Ottawa was $134,300 in April. According to the report, the average price for a home in Ottawa was $634,300 in May, up from $629,800 in April. looks at the income required to buy a home with a 10 per cent down payment, a 25-year amortization, $4,000 in annual property taxes and a monthly heating bill of $150. The mortgage rate was 4.48 per cent and the stress test rate of 6.48 per cent. The income required to buy a home increased in 12 of 13 markets surveyed by with Ottawa having the third-highest increase in Canada. Homebuyers in St. John's needed an average income of $88,910 to buy a home in June, up $2,460 in May. The average income required to buy a home in Fredericton increased $2,000 to $80,200 last month. 'Mortgage rates moved up this month and this was the primary factor that impacted affordability,' Penelope Graham, a mortgage expert at said in a statement. 'Home price movement was fairly evenly split with seven cities seeing prices rise and six cities seeing prices drop.' Toronto was the only city to see a drop in the income required to buy a new home as home prices dropped $17,700 in June. says homebuyers needed an income of $204,840 in June to buy an average-priced home, down $1,660 from May. Homebuyers in Vancouver need an income of $238,820 to buy an average-priced home, while Victoria residents need an income of $185,100.
Global News
16-07-2025
- Business
- Global News
60% of Canadians renewing mortgages could see payments go up by 2026
Most Canadian mortgage holders renewing their mortgages in 2025 or 2026 are likely to see an increase in their monthly payments, a recent report by the Bank of Canada says. Most of these borrowers hold a five-year, fixed-rate mortgage, the central bank said, and could see their monthly payments increase by 15-20 per cent. 'Compared with December 2024 payments, the average monthly mortgage payment could be 10% higher for those renewing in 2025 and 6% higher for those renewing in 2026,' the report read. However, the picture looks very different for those who are planning on renewing variable-rate mortgages. For them, a renewal might lead to a decline in monthly payments of five to seven per cent. This comes amidst cost-of-living increases since the start of the COVID-19 pandemic. According to the Bank of Canada's inflation calculator, there has been an annual rate of inflation increase of 3.68 per cent since 2020. This means that something that cost $100 in 2020 would cost around $120 in 2025. Story continues below advertisement 1:53 Homeownership most affordable in 3 years: report estimates that these increased payments could result in Canadian households paying an average of around $5,000 more every year. Get daily National news Get the day's top news, political, economic, and current affairs headlines, delivered to your inbox once a day. Sign up for daily National newsletter Sign Up By providing your email address, you have read and agree to Global News' Terms and Conditions and Privacy Policy 'Paying nearly $5,100 more on the mortgage annually is a considerable stretch for many Canadian households,' said Penelope Graham, mortgage expert at While lenders typically offer lower rates to new customers, instead of returning ones, Graham said those renewing have some options to keep costs down. 'If possible, accelerating payments or making a lump sum payment to lower the overall principal mortgage amount before the term is up is an ideal way to shrink payments at renewal time,' she said. However, switching from a fixed-rate to a variable-rate mortgage comes with risks, Graham said. The Bank of Canada's overnight lending rate has dropped 225 basis points since June 2024, bringing variable rates down with it. It is unclear whether the bank will cut rates further. Story continues below advertisement For Canadians concerned about meeting their mortgage payments if an increase takes place, Graham recommends reaching out to your lender. 'They can help you find a solution, including temporarily deferring your payments,' she said.
Global News
20-06-2025
- Business
- Global News
Buying a house got costlier in May. What should your household income be?
Signs of a rebound may be emerging in Canada's real estate market after months of declining home prices. While buyer-friendly conditions persist in some markets, many Canadians will have to shell out more for their monthly mortgage payments, a new report shows. The monthly home affordability report by looked at home prices and mortgage rates from 13 Canadian cities. In eight of those cities, mortgage affordability got worse in May. Penelope Graham, mortgage expert at said the buyer-friendly market conditions are unlikely to last for very long. 'While buyers have enjoyed attractive housing affordability conditions throughout the spring, those days may be numbered. The latest May national housing data reveals sales are firming up over the short term,' she said. While mortgage rates remained largely unchanged, rising home prices mean you'd have to spend more money on your monthly mortgage payments, depending on where you live. For most Canadian cities, the annual household income you'd need to get approved for a mortgage has also gone up. Story continues below advertisement In May, the price of the average Canadian home was $691,299. While that is still down 1.8 per cent compared with this time last year, it is an increase of 1.9 per cent compared with April this year. A Royal Bank of Canada report said buyers are expected to dive back into the market as the uncertainty around U.S. tariffs becomes clearer. 'We expect housing market confidence to gradually rebuild as tariff de-escalation lifts some of the uncertainty that hindered activity earlier this year,' RBC economist Robert Hogue said in the report. 1:54 Business Matters: Canada's housing market in holding pattern, CREA data shows Costlier mortgages The data from Ratehub's report is based on a 10 per cent down payment with a 25-year amortization. The city that saw the highest increase in monthly mortgage payments was St. John's, N.L., where someone locking down their mortgage in May would have to pay $45 more and would need an annual household income of $86,450. Story continues below advertisement 'St. John's saw the most significant increase, with $1,690 in additional income required to purchase the average home. This is due to home prices rising ($8,900), the biggest increase of all the cities,' Graham said. Get breaking National news For news impacting Canada and around the world, sign up for breaking news alerts delivered directly to you when they happen. Sign up for breaking National newsletter Sign Up By providing your email address, you have read and agree to Global News' Terms and Conditions and Privacy Policy Halifax also saw affordability worsen, with the average resident paying an additional $38 a month for their mortgage. They would need a household income of $122,830 (an increase of $1,430) to buy a house. Regina (increase of $27) and Montreal (increase of $26) both saw monthly mortgage costs go up. In Regina, you would need an annual household income of $79,350 (an increase of $1,020 since April) and in Montreal, you'd need $124,620 (an increase of $980 since April). After a drop in home prices in April, the price for an average home in Toronto rose $3,400 to $1,012,800 in May. A Torontonian would have to spend $17 more ($5,139 a month) and need an annual household income of $206,500 to be able to afford a home. Winnipeg saw monthly mortgage costs rise by $13 a month to $1,968 and the average Winnipegger would need $88,250 annually to be able to buy a house. Edmonton ($7) and Fredericton ($5) both saw minor increases in monthly mortgage costs. In Edmonton, you'd need an annual household income of $96,670, while in Fredericton, you'd need $78,200. The only city that saw no change in affordability was Calgary. The average home price in the city remained the same as in April ($583,000), as did the monthly mortgage cost ($2,958) and annual income needed to buy a house ($125,170). Story continues below advertisement 2:21 Business Matters: May 'another sleepy month' for homebuyers. Will a rate cut wake them up? Where did affordability improve? 'While the majority of the cities saw affordability worsen, the biggest change was actually in Hamilton, where affordability saw a massive improvement, with $3,480 less income required to purchase the average home,' Graham said. The average home price in Hamilton was $183,100 — a drop of $7,500 since May. Story continues below advertisement A Hamilton homebuyer would need an annual income of $163,020 to be able to buy a house. With a 10 per cent down payment and a 25-year amortization, their monthly mortgage rate came down to $3,973 a month. This means that a Hamilton mortgage buyer who locked down their rate in May would save $93 a month compared with someone who locked it down in April. The decline in home prices comes amid the U.S. trade war and President Donald Trump's 50 per cent tariffs on foreign steel and aluminum. Hamilton is home to major Canadian steel producers and faces growing concerns about the potential for layoffs and plant closures as a result of the tariffs. While Vancouver saw the second biggest decline in home prices, with a decline of $7,500, it remains Canada's most expensive housing market by far, with an average home in May costing $1,177,100. Vancouverites also need the highest annual income of any city in Canada at $237,550 a year. They would also have to pay the highest monthly mortgage of $5,973 with a 10 per cent down payment, although it dropped $38 from April. In May, Victoria came in as the third most expensive housing market in Canada after Vancouver and Toronto, though average home prices dropped to $892,700, with the average homebuyer needing an annual salary of $183,750. Monthly mortgage costs dropped $38 to $4,530 a month. Story continues below advertisement Affordability also improved in the nation's capital, with the average Ottawa home price dropping to $629,800. An Ottawa resident would save $7 on their mortgage payment if they bought in May ($3,196 a month) and would need an annual household income of $134,020 to be able to buy a house.
