Mortgage Blog

Quality advice, quality service and the best mortgage rates

Bank of Canada's Hidden Message on Interest Rates: This is Your Last Warning

March 14, 2022 | Posted by: Marc Crossman

Last week, the Bank of Canada made its first interest rate announcement of the year. Much to the surprise of economists and experts alike, the Bank of Canada chose not to raise interest rates, in spite of the raging inflation.

Though they said they’re not raising the rates now, they made it clear that interest rate hikes are coming, and they might arrive sooner than we expect.

Though Tim Macklem didn’t give any dates, it sounded as if the Bank of Canada was going to act fast. One reason for quick action: Lowering inflation to their projected goal of 2.3% by 2023, becomes less and less likely the more they delay raising interest rates.

February will likely be your last chance to lock into today’s interest rates. Then, when the Bank of Canada meets again in March, we’ll see an interest rate hike.

For 2022, the scheduled dates for rate announcements are:

  • March 2
  • April 13
  • June 1
  • July 13
  • September 7
  • October 26
  • December 7

I’d say you have until at most March to lock into a mortgage with historically low interest. But the question I’d ask is—should you buy a house right now?

Most of Canada’s top banks have warned that now may not be the most ideal time to enter the market. The average price for a home in Canada is around $720,860, which requires a higher down payment than many Canadians can afford.

Affordability is one concern, but so is overvaluation. Fitch and Moody, two of the three big credit agencies, have labelled Canada’s hottest markets as vastly overinflated. Simply put, the physical structure isn’t worth the price you pay.

If you can help it, I would wait to buy a home. Even though you’ll lock into a mortgage with a low rate, home prices will still make for high monthly mortgage payments. If you’re determined to buy one, however, call us at 780 701 3888 or email to get preapproved and lock in this lower rate!


Full article here:

Back to Main Blog Page

Google Rating
users image

Hi, How can I help you?