On July 13th, 2018 Bank of Canada Governor Stephen Poloz once again raised Interest Rates, this time by .25 points, up to 1.25 percent. Prior to the jump experts were divided whether or not the rate hike would come, as trade tensions with the United States continues and uncertainty proliferates. Indeed, we have not yet seen the full effects of the tariffs and counter-tariffs being imposed by the U.S. and Canada, and likely will not for at least a few months. So Now What? Some are already reflexively predicting that the new mortgage rates will result in an easing of housing prices, as borrowers will no longer qualify for the mortgage amount that they could a week ago. Their argument is that since borrowing is now more expensive the housing market will have to respond by making it more attractive for people to buy homes. Yet a close look at the fundamentals reveals that this is not necessarily the case, as interest rates moved marginally at best, demographic fundamentals remain, and...
Comments
Post a Comment