Lower rates will boost buyer confidence

As the Royal Bank of Canada leads other major banks in lowering five-year fixed mortgage rates, some industry experts believe there won’t be much of an impact on how the housing market performs in 2015.
 
“I don’t believe a quarter-point will make a significant difference,” said Justin Kua, a real estate agent in Toronto. “First-time buyers are already expecting low rates. It’s just giving people a little more confidence in being able to take on a mortgage.”
 
Over the weekend, the Royal Bank of Canada dropped its five-year fixed rate mortgage to just 2.84 per cent. 

Kua said he expects the market in 2015 to pick up where last year left off, with low inventory being the driving force behind the hot market.
 
“The market is going to be active whether interest rates are high or low,” he says. “Growing families still need to upsize and seniors still need to downsize.”
 
With that said, though, Kua is encouraging his clients to take advantage of a lower rate.
 
“If a client wants to move up and can afford a detached house now, I highly recommend it," he said. 

"It’s way cheaper now than it will be down the line. But, buyers should be proactive in paying down the mortgage, because while it’s cheap now, you have to be aware that higher rates are coming. Don’t sit on a huge mortgage assuming rates are going to stay low forever.”

Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate

COMMENTS

Get help choosing the best mortgage rate

Just fill in a few details, and we'll arrange for a Mortgage adviser to help you find the best mortgage for your needs

  • How soon do you want a mortgage?
  • Name
  • Where do you live?
  • Phone number
  • E-mail address

Industry news

Submit a press release

Poll

Should government update pot rules to prohibit growing in rentals?