Chinese Banks Keep Lending Rate Unchanged After PBOC Hold
Chinese banks left their benchmark lending rates unchanged following the central bank’s decision last week to hold a key rate on loans it offers to lenders.
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Chinese banks left their benchmark lending rates unchanged following the central bank’s decision last week to hold a key rate on loans it offers to lenders.
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Apr 3, 2024
BNN Bloomberg
,As home prices in Greater Toronto ticked higher in March, an analyst at the Toronto Regional Real Estate Board (TRREB) says households are beginning to accept higher payments amid elevated interest rates.
Figures from TRREB, released Wednesday, found that sales in Greater Toronto fell 4.5 per cent in March compared to the previous year. However, competition among prospective buyers drove average home prices up by 1.3 per cent year-over-year during the month to $1,121,615.
Jason Mercer, the chief market analyst at TRREB, said in an interview with BNN Bloomberg on Wednesday that during the first quarter of the year, the real estate market performed slightly better compared to 2023.
“I think part of it is that households, even in this higher interest rate environment, have come to terms with higher principal and interest payments on a monthly basis. Whether that's looking at a different type of home or a different part of the GTA to mitigate some of those increased costs,” he said.
According to TRREB, 6,560 homes were sold in March, down from 6,868 a year earlier.
Sales rose by 11.2 per cent annually during the first quarter, according to TRREB, as new listings were up by 18.3 per cent during the period.
Rate cut ‘catalyst’
Amid a slight increase in Toronto home prices last month, Mercer said he sees demand continuing to trend higher.
“We have started to see a moderate uptick in the demand for ownership housing. I think that's only going to continue as you move into the second half of this year with the anticipated rate cuts, perhaps as early as July,” he said.
Through speaking to brokers and polling data, Mercer said a lot of potential buyers appear to be “on the sidelines right now” but a move by the Bank of Canada to lower interest rates could spur more momentum in the market and act as a “catalyst.”
“May is normally the peak of the spring market…It'll be interesting to see, though, if we see a little bit stronger of a summer than we'd be normally accustomed to if we start to see the Bank of Canada pull the trigger on rate cuts,” he said.
Condo market
Mercer said that demand for condo units could also rise alongside any reductions in borrowing costs.
“When we did our latest round of consumer polling at the end of last year, one of the things we found is that households that are renting right now, a lot of them are saying…‘look if we see our rent go up, even by another dollar, we're going to be looking really closely at purchasing a home,’” he said.
Mercer added that the condominium apartment segment of the market is often viewed as an important entry point into homeownership for new buyers.
“Thinking about lower interest rates that come in the second half of this year and even more so in 2025…those renters (could) start to shift into the ownership market,” he said.
“So that would obviously put upward pressure on condominium apartment prices in the near future.”
With files from The Canadian Press