My back hurts… but I just love gardening. I am one to always stop and smell the lilacs, and crouch to take in as much of that sweet lily-of-the-valley scent as I can. I find it a little hard to make time for tending my own garden (is there a metaphor there?) but I really did on the May long weekend. I wouldn’t say I have a green thumb, though I am working on it. What I have is reverence for life and appreciation of beauty. That is actually my number one quality according to the VIA Institute on Character survey. (You can take yours here: www.viacharacter.or/survey/account/register)

I believe this makes me a great friend and a caring service provider. I want the people around me to thrive, and I’m grateful to have some skills that enable me to help.
Here are my latest Oprah-style favourite things that have me thriving lately…

My current meal obsession is still that breakfast hash from Q1. (Ask me to send you the recipe if you missed it.)

As well, I peeled myself a whole bunch of ginger and froze it for the following uses:

Morning drink of hot water, grated ginger, squeeze of lemon and a pinch of salt. I also sometimes add a dash of turmeric and.or cumin. Sip is while sitting in a squat and watch your digestive problems disappear.
Spiced rice. When I cook rice I’m in the habit of adding grated ginger, salt, olive oil, powdered cinnamon, cumin, turmeric and clove, and cardamom pods. This flavoured rice makes me so happy.

Best new habit is keeping a journal for the next day. Each night, before bed, I write down a basic schedule for my day, including scheduled meetings or workouts, and anything I’m committed to getting done, as well as notes and tasks to remember. It really helps with clearing my mind for a good sleep. I have a Whoop band, a biofeedback device, that reports a much better recovery when I do this practice and follow it with a bit of stretching before I go to sleep.

Best non-fiction – Big Magic by Liz Gilbert had me wishing it would never end. I listen to audiobooks and I loved having her speak to me, as an encouraging friend. I believe there are unlimited ways to express creativity so I think everyone could benefit from reading this book.
Most interesting fiction – I was listening to Good Omens by Terry Pratchett and Neil Gaiman and I liked it very much. But the show, starring David Tenant and Michael Sheen was more enjoyable for me. David Tenant is so fun to watch – wow. Every moment he was on screen I was captivated and wanted more. I think this is going to me a comfort re-watch show for me.

And here are some thoughts on mortgages and the market…

I think many people working in and selling real estate have felt a little frustrated by a lagging (or absent?) spring market. Prices remain down in many postal codes. There was an expectation for pent up demand to spark once the Bank of Canada began to lower interest rates (0.25% on June 5). There certainly were a lot of small celebrations about that, but I’m getting a bit of a “too little, too late” feeling for any real enthusiasm. Of course this pace is much more civilized for buyers, and that’s why the BoC is taking it slow. They are still concerned about prices. Urgency is low and that, honestly, would be the market I’d want to shop in. Still, many buyers seem to be waiting for rates to fall further… they could be waiting long enough to get priced out of the market. The saying “the best time to buy was 5 years ago… the second best time is now” remains true. 3 year fixed rates remain a popular rate, giving borrowers a stable rate for the period without committing to the long-popular 5 year fixed. Few people are starting to trust variable rates again.
Remember, the Bank of Canada rate announcements only directly affect VARIABLE rates. Fixed rates are still about 1% lower than variable (with the discounts). Most rate holds, and payment calculations are made on fixed rates, which are affected by bond yields, not PRIME RATE. So the BoC announcement would have little, if any, bearing on anyone’s pre-approval. Everything is connected, and therefore the expectation is for a downward trend in all rates. Economists are calling for additional rates drops and expect to be down another 1.75% by the end of 2025.

As always…

I want to hear from you, especially if you are thinking a change is coming, or one has come. I always recommend a having a discovery call and putting together a plan as well in advance as possible. There are so many decisions to make when it comes to buying/selling/moving/refinancing. It’s better to have a plan that can be adjusted to fit, than to have to make all your decisions under the gun.

https://calendly.com/kristendlc

If you’re interested, here’s a list of the books I’ve read in 2024 so far. If you’ve read any of the below I’d love to chat about them with you!

Tom Lake – Ann Patchett
Rest is Resistance – Tricia Hersey
House of Flame and Shadow – Sarah J Maas
The Iliad – Homer, translated by Emily Wilson
The Odyssey – Homer, translated by Emily Wilson
Pride and Prejudice – Jane Austen
Revolutionary Witchcraft – Sarah Lyons
A Grandmother Begins the Story – Michelle Porter
Good Omens – Terry Pratchett and Neil Gaiman
Miracle Morning – Hal Elrod
Great Courses Dante’s Divine Comedy – William R Cook and Ronald Herman
Covenant of Water – Abraham Verghese
Big Magic – Elizabeth Gilbert
Shantaram – Gregory David Roberts

From Sherry Cooper…

Inflation unexpectedly rose in May, disappointing the Bank of Canada as it deliberates the possibility of another rate cut next month.

The Consumer Price Index (CPI) rose 2.9% in May from a year ago, up from a 2.7% reading in April. This increase primarily reflects higher prices for services and, to a lesser extent, food. According to a Bloomberg survey, economists had expected 2.6% inflation last month.

Cellular services, travel tours, rent, and air transportation boosted service prices by 4.6% year-over-year (y/y) in May, up sharply from the 4.2% rise in April. Price growth for goods remained at 1%, although grocery prices rose more rapidly.

Monthly, the CPI index climbed 0.6% compared to expectations for a 0.3% gain and up from 0.5% in April. On a seasonally adjusted basis,  inflation rose 0.3%.

The Bank of Canada’s preferred measures of core inflation, the trim and median core rates, exclude the more volatile price movements to assess the level of underlying inflation. The CPI trim accelerated to 2.9% in May, following a downwardly revised 2.8% rise the previous month. The CPI median rose two ticks to 2.8%. Both measures of core inflation surprised economists on the high side.

Shelter costs have been a massive component of inflation this cycle. In May, rent rose a whopping 0.9%, lifting the yearly rise to 8.9% y/y, the second largest contributor to annual inflation. The single most significant inflation driver–mortgage interest costs–ticked down a bit to 0.8% m/m, reducing the yearly pace to 23.3%. It peaked above 30% last year. Excluding shelter, inflation is rising 1.5% y/y, up from 1.2% last month.

Bottom Line

Today’s inflation reading was undoubtedly a disappointment for the Bank of Canada, and it reduces the chances of another rate cut when they meet again on July 24. However, the June inflation data will be released on July 16. Barring a significant drop in June inflation, the next interest rate cut will likely be at the September meeting. That’s not good for the housing market, which has slowed to a crawl in recent months. The decline in mortgage rates proceeds as market forces drive down bond yields. Canada’s labour market is slowing as the jobless rate ticks up. Tiff Macklem said yesterday that he did not expect the unemployment rate to rise significantly further this cycle.

Interest rate cuts will be more gradual because rapid population growth has boosted economic activity, forestalling a recession and adding to inflationary pressure. The central bank’s overnight policy rate, now at 4.75%, will gradually move to 3.0% by the end of next year.