Home buyers and sellers now know that the key interest rate will be remaining steady for the time being, or at least until the Bank of Canada's next meeting September 4th. This is the 6th time in a row that the Bank has decided to maintain the overnight rate citing a sluggish economy and global trade tensions.
The Bank positively noted that "Recent data show the Canadian economy is returning to potential growth ... however, the outlook is clouded by persistent trade tensions. Taken together, the degree of accommodation being provided by the current policy interest rate remains appropriate."
Unlike a year ago where it was widely felt that the Bank would continue to increase the key rate until the reached around the 3% mark, the relatively stable key rate seems to be giving home buyers and sellers more confidence that the Bank will be taking a more measured approach moving forward.
Rob Regan-Pollock, co-chair of the Canadian Mortgage Brokers Association, commented:
“The continued 1.75% overnight rate alleviates consumer concerns about continued hikes and rising interest rates,” says , and “Mortgage payments will be stable and may even be on the way down which is sparking consumer curiosity and interest in purchases.”
Not only can home buyers currently find five-year fixed rates below 3%, they can actually leverage some of the best rates available in several years.
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