The Bank of Canada is maintaining its target for the overnight rate at 1/2 per cent. The Bank Rate is correspondingly 3/4 per cent and the deposit rate is 1/4 per cent.
Inflation is broadly in line with the Bank’s projection in its April Monetary Policy Report (MPR). Food prices continue to decline, mainly because of intense retail competition, pushing inflation temporarily lower. The Bank’s three measures of core inflation remain below two per cent and wage growth is still subdued, consistent with ongoing excess capacity in the economy. The global economy continues to gain traction and recent developments reinforce the Bank’s view that growth will gradually strengthen and broaden over the projection horizon. As anticipated, growth in the United States during the first quarter was weak, reflecting mostly temporary factors. Recent data point to a rebound in the second quarter. The uncertainties outlined in the April MPR continue to cloud the global and Canadian outlooks.
The Canadian economy’s adjustment to lower oil prices is largely complete and recent economic data have been encouraging, including indicators of business investment. Consumer spending and the housing sector continue to be robust on the back of an improving labour market, and these are becoming more broadly based across regions. Macroprudential and other policy measures, while contributing to more sustainable debt profiles, have yet to have a substantial cooling effect on housing markets. Meanwhile, export growth remains subdued, as anticipated in the April MPR, in the face of ongoing competitiveness challenges. The Bank’s monitoring of the economic data suggests that very strong growth in the first quarter will be followed by some moderation in the second quarter.
All things considered, Governing Council judges that the current degree of monetary stimulus is appropriate at present, and maintains the target for the overnight rate at 1/2 per cent.

According to statistics released today by The Canadian Real Estate Association (CREA), national home sales declined in April 2017.
Highlights:

• National home sales fell 1.7% from March to April.
• Actual (not seasonally adjusted) activity in April was down 7.5% from a year earlier.
• The number of newly listed homes jumped 10% from March to April.
• The MLS® Home Price Index (HPI) was up 19.8% year-over-year (y-o-y) in April 2017.
• The national average sale price rose 10.4% y-o-y in April.

Home sales over Canadian MLS® Systems fell by 1.7% in April 2017 from the all-time record set in March. April sales were down from the previous month in close to two-thirds of all local markets, led by the Greater Toronto Area (GTA) and offset by gains in Greater Vancouver and the Fraser Valley.
Actual (not seasonally adjusted) activity was down 7.5% year-over-year, with declines in close to 70% of all local markets. Sales were down most in the Lower Mainland of British Columbia, where activity continues to run well below last year’s record-levels. The GTA also factored in the decline, with faded activity compared to record levels set in April last year.
“Sales in Vancouver are down from record levels in the first half of last year but the gap has started to close,” CREA President Andrew Peck. “Meanwhile, sales are up in Calgary and Edmonton from last year’s lows and trending higher in Ottawa and Montreal. All real estate is local, and REALTORS® remain your best source for information about sales and listings where you live or might like to.”
“Homebuyers and sellers both reacted to the recent Ontario government policy announcement aimed at cooling housing markets in and around Toronto,” said Gregory Klump, CREA’s Chief Economist. “The number of new listings in April spiked to record levels in the GTA, Oakville-Milton, Hamilton-Burlington and Kitchener-Waterloo, where there had been a severe supply shortage. And with only ten days to go between the announcement and the end of the month, sales in each of these markets were down from the previous month. It suggests these housing markets have started to cool. Policy makers will no doubt continue to keep a close eye on the combined effect of federal and provincial measures aimed at cooling housing markets of particular concern, while avoiding further regulatory changes that risk producing collateral damage in communities where the housing market is well balanced or already favours buyers.”

The value of building permits issued by Canadian municipalities fell 5.8% to $7.0 billion in March, marking a second consecutive monthly decrease. Nationally, the decline was mainly the result of lower construction intentions for multi-family dwellings, particularly in British Columbia and Ontario. All provinces and territories, except Ontario and Quebec, registered decreases in the total value of building permits in March.
Residential sector: Multi-family component registers large decline
Municipalities issued $4.6 billion worth of residential building permits in March, down 8.4% from February. A notable decrease in the multi-family component more than offset higher construction intentions for single-family dwellings. Eight provinces reported declines in the residential sector in March, led by British Columbia and Ontario.
British Columbia and Ontario registered the biggest declines in the multi-family component in March, stemming from apartment buildings and, to a lesser extent, row houses. Conversely, single-family construction intentions rose 3.0% to $2.7 billion in March, with Ontario and Alberta leading the four provinces that posted gains.
In March, Canadian municipalities approved the construction of 16,821 new dwellings (-14.7% compared with February), consisting of 10,745 multi-family units (-19.4%) and 6,076 single units (-4.8%).
Provinces: British Columbia posts notable decline
British Columbia registered the largest decrease in the value of building permits in March, while Ontario and Quebec were the only provinces to report higher construction intentions. Multi-family dwellings were mainly responsible for the decline in British Columbia, led by apartment buildings. In Ontario, the large decrease in multi-family construction intentions was more than offset by increases in every other building component. Meanwhile, the gain in Quebec was mainly due to institutional structures, specifically nursing homes.
Census metropolitan areas: Vancouver registers largest decrease
The value of building permits fell in 19 of 36 census metropolitan areas in March. Vancouver reported the largest decline, while Montréal registered the biggest increase.
After posting two consecutive monthly increases, Vancouver registered a decrease in the value of building permits in March on the weakness of multi-family dwellings. Every component reported declines, except single-family dwellings.
In Montréal, the gain was mainly due to construction intentions for a retirement nursing home, as well as increased intentions for apartment-condominium constructions.
Edmonton posted the second-largest gain in the value of building permits among the census metropolitan areas in March, mainly the result of higher construction intentions for residential buildings. Apartment buildings led the advance while the single-family dwelling component increased for a third consecutive month.

On April 20, 2017, the Ontario government introduced the Ontario's Fair Housing Plan, a 16-point plan to control real estate, address the demand for housing, increase supply, and protect buyers and renters.
The 16 measures in the plan include a legislation that would implement a new 15 % Non-Resident Speculation Tax (NRST), similar to the 15 % tax on foreign buyers already introduced in Vancouver last May.
Once legislation passes, the tax would be effective retroactively to April 21.
The measures are aimed at cooling down the hot housing market in the Greater Toronto Area, where prices were up 33 % from a year ago while condominium rents rose 8.3 % in the first quarter from a year ago.
Now that two major cities have been impacted by a Foreign Buyer Tax, only time will tell if investors will look to other Canadian cities to invest their funds.

According to statistics released today by The Canadian Real Estate Association (CREA), national home sales were up on a month-over-month basis in February 2017.
Highlights:

• National home sales rose 5.2% from January to February.
• Actual (not seasonally adjusted) activity in February was down 2.6% from a year earlier.
• The number of newly listed homes was up 4.8% from January to February.
• The MLS^® Home Price Index (HPI) in February was up 16% year-over-year (y-o-y).
• The national average sale price edged up 3.5% y-o-y in February.

Home sales over Canadian MLS^® Systems rose by 5.2% month-over-month in February 2017 to reach the highest level since April 2016.
While February sales were up from the previous month in about 70% of all local markets, the national increase was overwhelmingly driven by an increase in activity across the Greater Toronto Area (GTA) and environs.
Actual (not seasonally adjusted) activity was down 2.6% from levels for the same month last year. The decline reflects a moderation in sales in the Lower Mainland of British Columbia compared to extraordinarily elevated levels recorded one year ago.
The number of newly listed homes rose 4.8% in February 2017, led by the GTA and nearby markets following a sharp drop in January. More than one-third of all local housing markets saw new listings recede from levels the previous month, including those in the Prairies, northern Ontario and the Atlantic region. Meanwhile, new listings in the Greater Vancouver region fell significantly from January levels, having retreated by nearly 25% to reach the lowest level since 2001.
With similar monthly increases in both sales and new listings, the national sales-to-new listings ratio was 69.0% in February, little changed from 68.7% in January.
A sales-to-new listings ratio between 40 and 60 is generally consistent with balanced housing market conditions, with readings below and above this range indicating buyers’ and sellers’ markets respectively.
The ratio was above 60% in almost 60% of all local housing markets in February, the majority of which are located in British Columbia, in and around the GTA and across southwestern Ontario.
The number of months of inventory is another important measure of the balance between housing supply and demand. It represents how long it would take to completely liquidate current inventories at the current rate of sales activity.
There were 4.2 months of inventory on a national basis at the end of February 2017, down from 4.5 months in January and the lowest level for this measure in almost a decade.
The imbalance between limited housing supply and robust demand in Ontario’s Greater Golden Horseshoe region is without precedent (the region includes the GTA, Hamilton-Burlington, Oakville-Milton, Guelph, Kitchener-Waterloo, Cambridge, Brantford, the Niagara Region, Barrie and nearby cottage country).
The number of months of inventory in February 2017 stood below one month in the GTA, Hamilton-Burlington, Oakville-Milton, Kitchener-Waterloo, Cambridge, Brantford, Guelph, Barrie & District and the Kawartha Lakes region.
The Aggregate Composite MLS^® HPI rose by 16% y-o-y in February 2017. This was up from January’s gain reflecting an acceleration in home price increases, particularly for single family homes in and around Toronto.
Prices for two-storey single family homes posted the strongest year-over-year gains (+17.9%), followed closely by townhouse/row units (+16%), one-storey single family homes (15%) and apartment units (13.7%).
While benchmark home prices were up from year-ago levels in 11 of 13 housing markets tracked by the MLS^® HPI, price trends continued to vary widely by location.
In the Fraser Valley and Greater Vancouver, prices are slightly off their peaks posted in August 2016. That said, home prices in these regions nonetheless remain well above year-ago levels (+21.4% y-o-y and +14% y-o-y respectively).
Meanwhile, benchmark prices continue to climb in Victoria and elsewhere on Vancouver Island, as well as in Greater Toronto, Oakville-Milton and Guelph. Year-over-year price gains in these five markets ranged from about 18% to 30% in February.
By comparison, home prices were down by 1.9% y-o-y in Calgary and by 1.2% y-o-y in Saskatoon. Prices in these two markets now stand 5.6% and 5.1% below their respective peaks reached in 2015.
Home prices were up modestly from year-ago levels in Regina (+3.5%), Ottawa (+3.8%), Greater Montreal (+3.3% y-o-y) and Greater Moncton (+1.2%).
The actual (not seasonally adjusted) national average price for homes sold in February 2017 was $519,521, up 3.5% from where it stood one year earlier.
The national average price continues to be pulled upward by sales activity in Greater Vancouver and Greater Toronto, which remain two of Canada’s tightest, most active and expensive housing markets.

By Scott McGillivray

(NC) Homes that show well and have great features typically sell faster than their counterparts, sometimes for a premium. If you want your home to stand out, a little effort can go a long way. Try these tips to create an enticing first impression.
1. Clean. A neat, clean home shows pride of ownership and suggests that it is well maintained.
2. Paint. Opt for a neutral colour so buyers will feel like there's one less thing to do before moving in. Grey, beige or the popular combination known as “greige” are always a hit. A fresh coat of white paint on trim will brighten the rooms.
3. Highlight your home's energy efficiency and green features. This is increasingly a big selling point, especially among younger buyers. New insulation that offers superior thermal performance and increased fire resistance, like Roxul Comfortbatt and Safe 'n' Sound, represent long-term savings and benefits to potential purchasers. Smart thermostats and low-flow water fixtures are also coveted.
4. Consider replacing worn flooring. Another lower-cost option is to give your floors a makeover by refinishing hardwood or shampooing carpets.
5. Make simple updates. New light fixtures or hardware on cabinetry can provide your room with an instant refresh. Give cabinets a new coat of paint if they look tired or dated.
6. Let there be light. Replace heavy drapes with sheer window coverings or valances to flood the home with as much natural light as possible.
7. Open up the space. Remove excess furniture and all signs of clutter. Organize closets and pantries. Open windows to allow the fresh air in.
8. Neutralize décor. Remove personal photos. Add inviting elements like fresh flowers, throws or toss cushions.
9. Create curb appeal. Clean and pressure-wash the driveway and walkways. Cut the grass, pull weeds, and trim shrubs. Consider planting annuals for fresh pops of colour. Paint your front door and house numbers, if needed. Stage the patio furniture to create the feeling of an outdoor retreat.
10. Throw down the welcome mat, and let buyers take it all in.
Not ready to sell? These tips also work well to revitalize a much-loved older home.
Scott McGillivray is host of the hit TV series Income Property and Moving the McGillivrays on HGTV Canada, a real estate investor, contractor, author, and educator. Follow Scott on Twitter @smcgillivray.
www.newscanada.com

Housing starts are now on pace to hit 204,669 units in Canada, whereas January saw them hitting 200,255 units, according to Canada Mortgage and Housing Corporation (CMHC). This trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.
Monthly highlights
- Condominium starts in the Montréal area increased considerably in February. The hike was mainly due to construction starting on some large real estate projects in the downtown Montréal-Griffintown sector. Activity on the new condominium market therefore remains strong in this zone, as these new units add to the nearly 3,000 units currently under construction.
- Sherbrooke has seen a rebound in single-detached housing starts in recent months. Lower supply on the resale market and a favourable job market have stimulated demand for new homes. In 2016, employment in Sherbrooke continued to grow, and the year ended with net gains in full-time jobs among people aged 25-44. These factors should support housing demand in 2017.
- In Toronto, low supply in the resale market resulted in demand spilling over into the new home market, particularly for low rise homes. Single-detached home starts were at their highest level for February in more than ten years. The total housing starts trend remained steady in February despite a drop in apartment starts.
- St. Catharines saw February 2017 housing starts reach the highest level for any February since 1991. A third of starts were townhouses and two-thirds were new singles across the region. This comes on the heels of a strong year for St. Catharines starts, where demand has been driven in large part by the relative affordability of housing compared to neighbouring markets.
- February saw total housing starts more than double in Winnipeg compared to the same period last year. New construction of multi-family units continued to drive total starts higher, with both purpose built rental and condominium units increasing year-over-year. Single-detached starts were also up by roughly 30% reflecting low inventories of completed and unsold new homes in 2016.
- Multi-family home construction more than doubled in Edmonton last month from the same period last year. This was unexpected given the near record levels of complete and unsold apartments on the market. The Edmonton apartment inventory has been high since the start of 2016.
- Housing starts in the Victoria CMA trended upwards in February. In particular, there was a surge in single-detached home starts in the West Shore municipalities. New construction has been supported by low inventories of homes for sale and strong migration to the region.
The standalone monthly SAAR of housing starts for all areas in Canada was 210,207 units in February, up from 208,934 units in January. The SAAR of urban starts increased by 0.9 per cent in February to 193,035 units. Multiple urban starts decreased by 4.7 per cent to 121,164 units in February, while single-detached urban starts increased by 12.1 per cent, to 71,871 units. Rural starts were estimated at a seasonally adjusted annual rate of 17,172 units.

The Canadian Real Estate Association (CREA) has updated its forecast for home sales activity via the Multiple Listing Service® (MLS®) Systems of Canadian real estate Boards and Associations in 2017 and 2018.
Canadian housing market trends continue to display considerable regional divergence. In British Columbia, activity in the Lower Mainland has cooled markedly from all-time highs recorded early last year; however, sales and price pressures elsewhere in the province remain historically strong.
In the resource-intensive provinces of Alberta, Saskatchewan, and Newfoundland and Labrador, sales activity is still running at lower levels and supply is elevated. This has resulted in weakened price trends for these provinces.
In housing markets around the Greater Toronto Area and including the furthest reaches of Ontario’s Greater Golden Horseshoe (the region includes the GTA, Hamilton-Burlington, Oakville-Milton, Guelph, Kitchener-Waterloo, Cambridge, Brantford, the Niagara Region, Barrie and nearby cottage country), the balance between supply and demand has become increasingly tight. This is expected to lead to continued double-digit price growth, resulting in further erosion in affordability and sales activity in the absence of a significant and sustained rise in new supply.
Recently tightened mortgage rules, higher mortgage default insurance premiums and an expected rise in mortgage interest rates all represent headwinds to affordability in all Canadian housing markets. It will be some time before their full impact on housing markets is evident.
In some regions, the recently tightened “stress test” for mortgage financing qualification will force some first-time buyers to re-think how much home they can afford and may lead to a drop in home purchases as they shop for a lower priced home. In regions where there is a shortage of lower-priced inventory, some sales may be delayed as buyers save longer for a larger down payment.
In markets like Vancouver and Toronto, where single family homes are in short supply and there are few affordable options, some buyers may find themselves priced out of the market entirely. In Toronto, the stress test for mortgage qualification may prompt some buyers to move further out into communities located in the Greater Golden Horseshoe where homes are more affordably priced.
Nationally, sales activity is forecast to decline by 3% to 518,700 units in 2017.
British Columbia is forecast to see the largest decline in sales in 2017 (-17.5%), followed by Prince Edward Island (‑10.8%). Activity in both provinces is retreating from all-time highs reached last year. Newfoundland & Labrador is also forecast to see a decline in sales in 2017 (-8.4%), continuing a softening trend that stretches back nearly a decade.
Alberta is forecast to have the largest increase in activity in 2017 (+5%) that still leaves it nearly 10% below the 10-year average.
Elsewhere, sales activity is forecast to be little changed from 2016 to 2017. Ontario sales are forecast to rise by less than 1% in 2017, as strong demand runs up against an increasingly acute supply shortage.
While prices are still rising rapidly in Ontario, British Columbia has seen a compositional shift in the average price that reflects softer sales activity in the Lower Mainland which has some of the most expensive real estate in Canada.
Average prices in other provinces are either rising modestly or holding steady, reflecting well balanced supply and demand.
The national average price is forecast to rise by 4.8% to $513,500 in 2017, with significant regional variations. The average price is expected to retreat by more than 5% in British Columbia as well as Newfoundland and Labrador, by 2.8% in Saskatchewan while rising by more than 15% in Ontario.
In other provinces where average price last year began showing tentative signs of improving, average price gains are forecast to hold below the rate of inflation in 2017 as the impact of recent regulatory changes and higher expected mortgage rates lean against stronger demand and tighter market conditions.
The national average price is forecast to rise by 5% to $539,400 in 2018, reflecting ongoing market tightness in Ontario and a further return to more normal levels in British Columbia. Price gains outside of the Greater Golden Horseshoe are not expected to approach the increase in the national average price.

CMHC (Canada Mortgage and Housing Corporation) will increase its homeowner mortgage loan insurance premiums effective March 17, 2017.
Premiums are calculated based on the loan-to-value ratio of the mortgage being insured. Lenders typically require mortgage loan insurance when a homebuyer makes a down payment of less than 20 %.
The premium can be paid in a single lump sum but more frequently is added to the mortgage principal and repaid over the life of the mortgage as part of regular mortgage payments.
For the average CMHC-insured homebuyer, the higher premium will result in an increase of approximately $5 to their monthly mortgage payment.
For example, if your property was $266,500.00 and you have a downpayment of 5% or $13,325.00, you would have a mortgage of approximately $253,175.00 and need mortgage insurance.
Prior to the increase, your cost for Mortgage Insurance from CMHC would be 3.60% of $253,175.00 or $9114.30.
After March 17, your cost for Mortgage Insurance from CMHC would be 4.00% of $253,175.00 or $10,127.00.
However – this $1013.00 increase is spread out over the life of your mortgage, typically for 25 years.  Your increase on a monthly basis will be about $5.10.