More Rate Changes in Store?

A well performing economy and a housing juggernaut that refuses to slow down raises the likelihood that more rate increases from the Bank of Canada are in store for us. It is almost a certainty that the Bank will raise rates in May but it is also likely that they won’t stop there. The projected May increase will have the impact of raising Prime by 25bps and therefore increasing Variable Rate mortgage rates as well as fixed rate mortgages.

The only potential cloud on the horizon is the red hot Canadian dollar. The increased value of the dollar will, at some point, have an impact on our exports which become more expensive south of the border and overseas.

For a while it seemed that all the economic strength was in the west around the Oil Patch but with the latest news on unemployment and the continued improved projection for house sales from CREA it seems the whole country is doing well. While the unemployment rate edged up there was some good news for the Manufacturing sector in terms of job creation.

As with any increasing rate environment it is a great idea to get your clients pre-approved from a mortgage. It costs you nothing and has the effect of locking in current rates for up to 120 days.

Contact me to find out more.