As devastating wildfires rage across Los Angeles, the financial toll is becoming clear—and it’s staggering. Analysts at Wells Fargo and Goldman Sachs estimate that insurance costs alone could reach $30 billion, with total damages soaring to $40 billion when non-insured losses are accounted for. This makes the current wildfires the costliest in California’s history and one of the most significant natural disasters in the U.S.

The Human and Economic Impact

More than 12,000 homes and structures have been destroyed, leaving thousands of families displaced. Tragically, at least 24 lives have been lost, and over a dozen people remain unaccounted for. The fires, fueled by severe drought and high winds, continue to spread across 45 square miles of Los Angeles County. With 92,000 residents under mandatory evacuation and nearly 89,000 more on alert, the crisis underscores the growing challenges homeowners face in wildfire-prone areas.

Rising Insurance Costs and Market Strain

The growing frequency and intensity of natural disasters like wildfires have strained the insurance industry, with many providers scaling back coverage or exiting the California market altogether. In fact, average home insurance premiums in California skyrocketed by 43% between 2018 and 2023, according to S&P Global.

Insurers cite escalating risks and costs driven by climate change, inflation, and increased rebuilding expenses. For homeowners, this means higher premiums, stricter underwriting requirements, and in some cases, difficulty finding adequate coverage.

The Role of Climate Change

While wildfires are a natural phenomenon, climate change has intensified their frequency and severity. Human activities, such as deforestation and urban expansion, exacerbate these risks, putting more homes and communities in harm’s way. Experts predict that events like these will only become more common in the future.

Protecting Your Home and Finances

For homeowners in high-risk areas, these developments highlight the importance of robust financial planning and proper insurance coverage. As your broker, I understand how critical it is to navigate these challenges, whether you’re buying a new home, refinancing, or exploring coverage options.

Here are some steps to consider:

• Review Your Insurance Policy: Ensure your coverage reflects current replacement costs for your home and belongings.
• Consider Additional Coverage: If you live in a wildfire-prone area, explore endorsements or policies specifically designed for natural disasters.
• Evaluate Your Mortgage Options: Refinancing or restructuring your mortgage can help you manage costs and protect your financial future.

Stay Informed and Prepared

While the immediate focus remains on containing the fires and supporting affected families, this tragic event serves as a stark reminder of the need for preparedness. Homeownership is a significant investment, and ensuring it’s protected is essential to long-term peace of mind.

If you have questions about how these changes might affect your mortgage or financial planning, I’m here to help. Let’s work together to ensure your home—and your finances—are secure, no matter what challenges come your way.

Inspired by ABC News’ Kevin Shalvey, David Brennan, Emily Shapiro, Meredith Deliso, Max Golembo, Matthew Glasser and Julia Jacobo contributed to this report.

Full Article: Los Angeles fire losses could reach $30 billion for insurers – ABC News

Food Costs on the Rise

The 2025 Canada Food Price Report forecasts a 3% to 5% increase in food prices. For a family of four, that could mean spending $801 more on groceries annually. While meat, vegetables, and restaurant meals are expected to see the highest increases, the good news is that B.C.’s food inflation is projected to remain below the national average.

Housing Costs Continue to Climb

Renters will face a 3% increase in allowable rent hikes, and the BC Real Estate Association predicts a 3.3% rise in home prices. New home-flipping taxes and varying property tax increases across municipalities, including a 3.9% hike in Vancouver, will also affect homeowners. Additionally, utility fees in Metro Vancouver are set to jump by 25.3%.

Energy and Transportation Updates

The carbon tax will increase in April, raising the cost of gasoline and other fuels. FortisBC natural gas rates will rise by 17.5%, while BC Transit and TransLink fares will see hikes of 20% and 4%, respectively. However, BC Ferry fare increases are capped at 3.2% until 2028.

Silver Linings for 2025

GST Holiday Savings

The federal GST holiday, in effect until February 15, 2025, offers a 7% savings on select prepared foods, non-alcoholic beverages, toys, and more.

B.C. Tax Rebates

The provincial government will issue tax rebates of $500 for individuals and $1,000 for families, providing some financial relief this spring.

Carbon Tax and Family Benefits

Increased carbon tax rebates and family benefits will continue through June, with families of four seeing up to $1,760 in additional support.

Mortgage Rule Changes

The insured mortgage cap has increased to $1.5 million, and first-time buyers or those purchasing new builds can now access 30-year amortization periods, reducing monthly payments.

Lower Interest Rates

With the Bank of Canada’s key interest rate down to 3.25%, mortgage holders and borrowers will benefit from lower financial pressures compared to last year.

Looking Ahead

Navigating the financial changes in 2025 can be overwhelming, but you don’t have to face it alone. Whether you’re looking to buy a home, refinance, or explore ways to manage rising costs, I’m here to help you make informed decisions. Let’s work together to achieve your financial goals this year.

Here’s to a prosperous and joyful 2025! Don’t hesitate to reach out for personalized advice or assistance.

Inspired by Global News – Simon Little. Full Article here: What will cost British Columbians more in 2025? | Globalnews.ca

As the Bank of Canada prepares for its final interest rate decision of 2024, all eyes are on how it will impact the Canadian dollar. Here’s what you need to know:

• What’s Happening?
  The Bank of Canada is expected to cut its benchmark interest rate for the fifth time this year, potentially by 50 basis points. This aggressive rate-cutting cycle is aimed at tackling Canada’s slowing economy.
• Why It Matters
  A significant rate cut could weaken the Canadian dollar further, already hovering near 4.5-year lows. A weak loonie makes U.S. travel and imported goods more expensive, including fresh produce, which could push inflation higher.
• Diverging Policies
  Unlike Canada, the U.S. Federal Reserve is moving at a slower pace in cutting rates due to stronger economic conditions south of the border. This divergence is likely to continue, putting additional pressure on the loonie.
• Long-Term Outlook
  Economists predict the Canadian economy will rebound by late 2025 as the effects of these rate cuts begin to materialize. While the loonie may face challenges in the short term, stabilization is expected once policy rates between Canada and the U.S. align.

In conclusion, while immediate impacts on the loonie may feel challenging, the Bank of Canada’s actions aim to foster long-term economic recovery. Canadians should prepare for short-term price pressures but keep an eye on potential relief in the years ahead.

Blog inspired by Craig Lord, full article available at Bank of Canada readies for a rate cut. Why the loonie is bracing for impact

Canada didn’t have much of a winter last year thanks to an El Niño, but with that weather pattern in the rearview mirror, this year could be very different. (CBC/Radio-Canada)

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Last winter was one for the record books. In a country known as the Great White North, it was anything but. Instead, it was the warmest winter on record for the country.

That was mainly thanks to an El Niño, a natural, cyclical warming in a region of the Pacific Ocean that, coupled with the atmosphere, can cause global temperatures to rise. 

But El Niño is in the rearview mirror, so what can Canadians expect this winter?

“Winter will at least attempt to salvage its reputation across Canada,” Chris Scott, The Weather Network’s chief meteorologist, told The Canadian Press.

He said the forecast suggests this winter will be generally colder and more impactful than last year, with the cold comeback aimed more toward Western Canada. The forecast is for a colder season with near- or above-normal snow totals across parts of the west.

The Weather Network’s forecast map for winter shows most of the country at either near normal or above normal temperatures. (The Canadian Press/The Weather Network)

That’s particularly good news in an area that is experiencing drought conditions.

When it comes to Ontario and Quebec, temperatures look to be warmer than average in the winter forecast, particularly January and February.

Still, Scott said that in Ontario and Quebec — which have been experiencing a warm fall thus far — winter is on its way. The colder temperatures that have descended in the West won’t just stay put.

Though Environment and Climate Change Canada’s winter forecast for December, January and February won’t be released until Dec. 1, its senior climatologist, David Phillips, said their forecast will likely be similar, in the sense that we won’t be getting two warm winters in a row.

“I’ve been saying there’s going to be more of a winter this year than last winter, but, you know, that’s like saying tonight’s going to be dark and tomorrow is going to be light,” he told CBC News. “I mean, last year we had, by far, the warmest winter in Canada in 77 years of ranking these things.”

He noted that there is a forecast for La Niña — El Niño’s cooler companion — but said that if it does develop, it’s likely to be weak, so its influences, like a cold winter, may be muted. 

Only two areas of the country are expected to see above-normal precipitation this winter. (The Canadian Press/The Weather Network)

Across the provinces and territories

Though it will be milder in Ontario and Quebec, they will likely experience above-average precipitation.

And, after colder temperatures in the next couple of weeks, Manitoba and Saskatchewan are looking at a more typical winter both in terms of precipitation and temperature, the forecast suggests.

Scott says it’s generally a good-news scenario for drought-weary Prairie farmers who rely on melting snow to help boost soil moisture in the spring.

The iciest conditions are expected farther west, where a colder-than-normal winter in Alberta and British Columbia is expected to be paired with near- or above-normal precipitation across much of the region.

It’s good sign for ski resorts across B.C. and into Alberta’s foothills — including in Banff and Lake Louise, Scott said.

When it comes to Atlantic Canada, Scott says they may see fewer storms, but they shouldn’t let their guard down.

As for the territories, Yukon and western parts of the Northwest Territories will see below-normal temperatures, while Nunavut is forecast to be warmer than normal.

The Weather Network is forecasting above-normal snowfall for parts of central Ontario and parts of Quebec, as well as southern parts of B.C., Alberta and Saskatchewan. (The Weather Network/The Canadian Press)

Changing climate

Climate change, driven by the burning of fossil fuels, is making some of these long-term forecasts more difficult, according to Phillips.

“Canada has been warmer in the last 20 or 30 years,” he said. “La Niña, I used to think, when I began looking at seasonal forecasting, you always were happy to see El Niño, La Niña, because it made your batting average much higher.”

But that’s not the case anymore. While El Niño still continues to increase warmth in parts of Canada, and the global average, La Niña isn’t having the cooling effect it once did. Recent years that experienced a La Niña — 2020 to 2022 — were still some of the hottest years on record globally.

“It’s just not the same country that we had, say, 20-30 years ago. And the big difference is the fact that, hey, we do get winter. It sometimes looks like winter, it feels like winter, but it’s certainly not the punishing kind of typical, classic kind of winter of our youth,” Phillips said.

The U.S. National Oceanic and Atmospheric Administration is forecasting a 57 per cent chance of a La Niña developing in the three-month period of October to December, though there’s no guarantee, and that will most certainly influence the type of winter we get.

“La Niña has been afraid to walk through the door, so we’re kind of stuck in neutral right now in the Pacific,” he said.

“And that’s important, because the Pacific Ocean, I like to think of it as the engine that drives the global weather pattern.”

As for whether or not we’ll see a white Christmas, Scott says it’s still too far off to call. 

Inspired by Nicole Mortillaro · CBC News. Full Article at What does winter have in store for Canadians this year? | CBC News

OTTAWA (Reuters) -The Bank of Canada is starting to see the impact of its four rate cuts so far this year and expects to gather more evidence in the months ahead, Governor Tiff Macklem said on Tuesday.

The central bank last week cut its key benchmark rate by 50 basis points to 3.75%, its first bigger-than-usual move in more than four years, and hailed signs the country had returned to an era of low inflation.

The central bank, which hiked rates to a 20-year high to fight soaring prices, has now cut four times in a row since June. Inflation in September sank to 1.6%, below the 2% target.

“You are starting to see some impact of (the cuts). Some of it is more anecdotal – I expect we will see more in the data going forward,” Macklem said.

Macklem, speaking to the House of Commons finance committee, reiterated that the bank would be able to cut rates further if the economy evolved broadly in line with forecasts.

“We want to see growth strengthen. Last week’s interest rate decision should contribute to a pickup in demand,” he said.

(Reporting by Promit Mukherjee and David Ljunggren; Editing by Leslie Adler, Sandra Maler and Daniel Wallis)

Full Article at Bank of Canada says it is starting to see impact of recent rate cuts

The Bank of Canada has lowered its key interest rate to 3.75 per cent, making a 50 basis-point cut for the first time since the COVID-19 pandemic.

Before Wednesday, the rate stood at 4.25 per cent. Economists were expecting the central bank to go with a larger-than-usual cut, compared to the 25-basis-point downgrades made in June, July and September.

The last time the bank made a cut this size was on March 27, 2020.

As concerns over inflation have subsided — out-of-control price growth, the catalyst for the central bank’s initial rate-hike campaign, is now back within the target range — the bank has focused on cutting to keep inflation stable and support economic growth, which has slowed under the pressure of high rates.

“We need to stick the landing,” Bank of Canada governor Tiff Macklem told a news conference Wednesday morning.

“With inflation back to two per cent, we want to see growth strengthen. Today’s interest rate decision should contribute to a pickup in demand.”

Macklem outlined the economic conditions that informed the bank’s rate cut decision. He noted that core inflation has continued to ease, as has shelter inflation, though he noted that housing prices are still elevated. Excess supply in the economy has brought consumer prices down

“Job layoffs have remained modest but business hiring has been weak, which has particularly affected young people and newcomers to Canada. Simply put, the number of workers has increased faster than the number of jobs,” he added.

Macklem noted during the conference that, should the economy continue to evolve broadly in line with its forecast, the bank expects to reduce the policy rate further. But he cautioned that the timing and pace of cuts would depend on incoming economic data and its potential impact on the bank’s inflation outlook.

He repeated a now-familiar refrain, saying that the Bank of Canada will take decisions one meeting at a time.

Why aren’t Canadians feeling relief?

During a news conference, Macklem responded to questions from reporters who asked what he would say to Canadians who aren’t feeling the impact of lower inflation and interest rates in their everyday lives.

“It has been a long road back from the high inflation we experienced coming out of the pandemic,” said Macklem. “It’s been a long fight, but it’s worked…. I think Canadians can breathe a sigh of relief.”

One reporter pushed back on the governor, saying that many Canadians aren’t feeling relief. “We’re very aware of that,” Macklem responded.

“You can see it in our own consumer survey. There is a lot of hesitancy. I think the message today is that, with inflation down, Canadians don’t have to worry as much about big changes in their cost of living.”

Canadians might not be feeling relief from lower inflation because it doesn’t mean lower prices. A lower inflation rate indicates that prices are still increasing, but doing so at a slower pace.

Avery Shenfeld, chief economist of CIBC World Markets, wrote in a note to clients that “it would take a significant turn of events to stand in the way of another cut of that magnitude in December.”

“That said, as has been its practice of late, the bank has kept its options open by not signalling anything specific about the size of individual rate cuts ahead,” Shenfeld wrote.

By: Jenna Benchetrit

Full Article: Bank of Canada cuts key interest rate by half point for first time since COVID-19 pandemic (msn.com)

Canada’s housing market could soon see some major changes to mortgage rules that might make owning a home more realistic for Canadians, especially first-time buyers.

Announced by the Department of Finance on Monday and touted as the “boldest mortgage reforms in decades,” these updates are slated to kick in in December and aim to make mortgages in Canada more affordable, especially for millennials and Gen Z.

So, what’s new? First, the government has announced it’s raising the price cap for insured mortgages to $1.5 million. This move aims to help people in more expensive markets like Vancouver and Toronto, where home prices have skyrocketed in recent years. It means buyers could qualify for a mortgage with less than a 20% down payment on homes priced up to $1.5 million, as opposed to the current $1 million cap.

Another major change is the expansion of the eligibility criteria for 30-year amortizations that were originally introduced last month. This means allowing lower monthly mortgage payments over a longer period of time, offering short-term relief for many young Canadians who are just starting their careers.

Currently, the maximum amortization period for most insured mortgages in Canada is 25 years — although as of August, the government made changes to allow 30-year mortgage amortizations for first-time homebuyers who are purchasing new builds. Now, it’s expanding eligibility for these extended mortgages to all first-time buyers and all new builds.

These reforms are set to come into effect on December 14, 2024, and they come shortly after changes already introduced last month. This includes new rules that allow insured mortgage holders to switch lenders at renewal without going through another stress test, giving homeowners more flexibility to shop around for the best deal.

The federal government says these new rules are part of its broader housing plan to boost housing construction and address the housing shortage across the country. The plan aims to open up nearly 4 million new homes, making it easier and more affordable for Canadians to find a place to call their own.

If you’re considering buying a home, these changes could offer new opportunities, but it’s a good idea to chat with a mortgage expert to understand how the new rules might benefit you!

Story by MTL Blog Staff

Full Article: Canada’s new mortgage rules could make it easier to buy a home — Here’s what you need to know (msn.com)

The third consecutive rate cut was widely expected by economists and brings the central bank’s benchmark interest rate to 4.25 per cent

Wednesday’s decision marks the first time since the global financial crisis in 2009 that the Bank of Canada has cut rates at three meetings in a row.

The policy rate, which widely sets the cost of borrowing across Canada and informs the rates many Canadians get on mortgages and other loans, has fallen 75 basis points since the easing cycle began in June.

“If inflation continues to ease broadly in line with our July forecast, it is reasonable to expect further cuts in our policy rate,” Bank of Canada governor Tiff Macklem told reporters Wednesday.

“We will continue to assess the opposing forces on inflation, and take our monetary policy decisions one at a time.”

Asked Wednesday whether the central bank debated a steeper cut of half a percentage point, Macklem did not answer directly, but he did not rule out a change of pace moving forward.

“We did discuss some different scenarios. Scenarios where it might be appropriate to slow the decline in interest rates… and where it might be appropriate to cut by 50 basis points,” he said.

Macklem explained that if the economy proves stronger than anticipated and inflation more stubborn, the Bank may pause its easing cycle at a future decision. But he added that if the economy “was significantly weaker … yes, it could be appropriate to take a bigger step, something bigger than 25 basis points.”

Randall Bartlett, senior director of Canadian economics at Desjardins, told Global News Wednesday that he does not currently expect the Bank of Canada will take any oversized steps as the benchmark interest rate trends lower.

He calls for two more 25-basis-point cuts this year and six more to follow in 2025, eventually bringing the policy rate to a resting point of 2.5 per cent.

Financial markets see a 93 per cent chance of a rate cut of 25 basis points in October while a rate reduction in December is fully priced in, according to Reuters.

CIBC chief economist Avery Shenfeld echoed calls for a series of quarter-point cuts through to March 2025 in a note to clients Wednesday.

He added that moving in bigger, 50-basis-point steps would be “defensible” given the positive inflation trends of recent months, but noted that the Bank of Canada’s appetite for easing appears satiated with 25-basis-point moves.

Shenfeld noted that if inflation or jobs data comes in particularly weak over the coming months, the central bank may take oversized steps as part of a “bolder pace of easing.”

The Bank of Canada will get its next look at the labour market on Friday when Statistics Canada releases the employment data for August.

Dawn Desjardins, chief economist at Deloitte Canada, told Global News on Wednesday that the oversized steps of 50, 75 and even 100 basis points seen during the rapid tightening cycle reflected an “emergency” situation as inflation rapidly surged to levels not seen in more than 40 years.

But the situation now, with inflation gradually floating back to earth, is just telling the Bank of Canada that its policy rate doesn’t have to be as “prohibitively high” as it was during the peak of the tightening cycle.

“So do we really need to have interest rates that are really causing some friction for many households and businesses who have to finance at higher costs? I don’t think so. And I think that’s what the Bank is really saying,” she said.

Bartlett also said that Wednesday’s messaging from the Bank of Canada reflects a sense of “calm,” not a fear that the economy is heading towards a steep downturn.

“To see a 50-basis-point cut, we would need to see a material decline or softening in economic activity,” he said.

Annual inflation has continued to cool through 2024, last coming in at 2.5 per cent in July. Macklem noted on Wednesday that while shelter inflation continues to run hot, there have been signs of easing for renters as of late, as well as for Canadians renewing their mortgages as the central bank’s policy rate continues to fall.

He meanwhile acknowledged that signs of slowing in the June and July gross domestic product results mean the Bank of Canada’s calls for a pickup in third-quarter economic growth might now be ambitious. He said there are risks that uptick might be weaker than previously thought in the central bank’s latest forecasts from July.

Macklem said the Bank of Canada’s governing council would be “guided by incoming information” and the projected impacts on the inflation outlook in deciding the future path for interest rates.

While the Bank of Canada is expecting inflation to ease further in the months ahead, Macklem’s commentary noted a risk that price pressures may “bump up later in the year,” largely the result of the previous year’s drops falling out of the annual comparison.

Economists and market watchers have noted a tone shift from the Bank of Canada in recent months: downplaying concerns that it won’t hit its mandated two per cent target and instead focusing on deterioration in the labour market and the wider economy.

Macklem also reiterated in his comments Wednesday that the central bank is as worried about inflation dipping below two per cent as it is stalling above the target.

“With inflation getting closer to the target, we need to increasingly guard against the risk that the economy is too weak and inflation falls too much,” he said.

Bartlett said that dipping too far below two per cent inflation risks tipping the economy into deflation, or a “broad decline in prices.” While that might sound great to Canadians who are still struggling to make ends meet, he explained that deflation poses a serious risk to the economy that could hamper businesses and lead to wider layoffs.

“That’s really the soft landing that the Bank of Canada is trying to make,” Bartlett said. “So get inflation back to something that’s low, stable and predictable, but making sure to not drive the economy into some sort of recession at the same time.”

While Macklem stopped short of declaring that the Canadian economy has successfully skirted a recession as inflation nears the two per cent target, he maintained that the Bank of Canada is getting closer to the coveted “soft landing.”

“We haven’t landed the economy yet. The runway’s in sight, but we have not landed it yet,” he said.

The Bank of Canada’s next interest rate announcement will come on Oct. 23, alongside updated forecasts for inflation and the Canadian economy.

— with files from Global News’s Jillian Piper and Reuters

Story by Craig Lord

FULL ARTICLE: The Bank of Canada cut rates again. Here’s why, and what’s next (msn.com)

The Bank of Canada cut its key interest rate to 4.5 per cent on Wednesday, with governor Tiff Macklem saying during a news conference that it would be reasonable to expect further rate cuts if inflation continues to ease.

The cut was widely expected by economists after inflation eased in June. It marked the central bank’s second consecutive cut after last month’s meeting, when it cut rates for the first time since March 2020.

“If inflation continues to ease broadly in line with our forecast, it is reasonable to expect further cuts in our policy interest rate,” Macklem told reporters.

The bank brought key interest rates down by 25 basis points to 4.75 per cent during that June meeting. The rate had previously been held at five per cent since July 2023.

The bank began a long and aggressive cycle of rate hikes in April 2022 to tame persistent inflation.

After a May inflation report showed that the consumer price index had crept up to 2.9 per cent, some analysts had doubts that the Bank would cut rates again in July. But June’s 2.7 per cent inflation reading quelled those concerns.

“Inflation trends have been directionally encouraging,” even if some categories remain stubbornly elevated, wrote Bank of Montreal economist Benjamin Reitzes in a note.

The bank will make its next interest rate decision on Sept. 4.

Macklem and senior deputy Carolyn Rogers spoke about the interest rate decision during a news conference on Wednesday morning.

With inflation expected to move closer to the bank’s two per cent goal, a slack labour market and economic conditions expected to weaken, its governing council made the decision to lower the interest rate, Macklem said during the news conference.

“At the same time, price pressures in shelter and some other services are holding inflation up. We are increasingly confident that the ingredients to bring inflation back to target are in place,” he said.

He said those opposing forces — a weak economy pulling inflation down, and shelter prices keeping it up — means a decline in inflation will most likely be gradual, with possible setbacks along the way.

He kept the door open to further interest rate cuts should inflation continue to come down, but repeated several times throughout the news conference that the bank is “not on a predetermined path” and would be taking things “one meeting at a time.”

Addressing a question about housing, deputy governor Carolyn Rogers said “it would be a mistake” to pin hopes for better housing market conditions on the single solution of interest rates.

Cutting interest rates has an immediate impact on mortgage lending rates. But rent continues to increase and insurances, taxes, maintenance costs are rising, all of which put upward pressure on shelter inflation, Rogers explained.

“The bottom line on housing is we are going to lower interest rates if the economy continues to go in the direction we expect,” she said.

Story by Jenna Benchetrit

FULL ARTICLE: Bank of Canada cuts key interest rate again, more cuts ‘reasonable’ if inflation keeps easing (msn.com)