Bank of Canada Lowers Rate
All eyes were on the Bank of Canada Wednesday when as expected they lowered the bank rate by 25 basis points. No doubt this is great news that many borrowers have been waiting to hear. But what happens now? When rates change; the overall affect usually lags, and it may take some time to feel the impact of lower rates. But nonetheless, it’s very positive and a comforting relief for borrowers especially those with variable rate mortgages.
The real estate market is showing some weakness and last month’s data was much softer than expected. There are a few locations that are an exception, but overall inventory has increased substantially, sale volumes have dropped, and prices have been softening. That being said, average prices are higher than the same period last year and higher than last month.
The drop in the bank rate should be very positive for the Real Estate market. Many buyers have been waiting to see the direction of interest rates before taking on a home purchase. Mortgage rates have softened, and 5-year fixed rates can be offered as low as 4.99%; Variable rate mortgages as low as 6.60%. Given all of this, the best time to buy a detached house may be right now.
Need money and the bank said no? Turn that:
“‘Sorry, I can’t make the numbers work’
to: ‘no problem, how much do you need?’. ”