The Wednesday’s announcement produced no rate hike, at least not yet. But the Bank of Canada warned the higher interest rates are coming. The Canadian financial markets are factoring in three to five interest rate hikes this year. So, what could it mean for the real estate market?
As a rule, any interest rate increase will slow down the market, resulting in fewer people being able to qualify for a mortgage, and prices stabilizing or decreasing. However, looking at the current mortgage rates, even if they increase slightly, it doesn’t mean they aren’t still very low. Anything below 3% is basically “free” money. Right now, variable rates are hovering around 1.45% while fixed rates have climbed to approximately 2.84%. The strong seller’s market we experience right now will likely stay robust for at least the next few months. This is certainly great news for those who are planning to sell their home or investment property anytime soon. As for the buyers, even with those 3-5 predicted rate hikes, the rates will still remain at historical low for the foreseeable future.
If you are thinking of buying a home this year, of up-sizing or purchasing an investment property, we highly recommend meeting with the Brown and Keyes Real Estate Team! We can offer in-person and virtual appointments to be scheduled at your convenience. We are here to help! We are your Key Negotiators!
