Home interest rates Canada : Based on Mark Ercolao and TD Economics, Canada could witness a significant drop of interest rates in the spring.
Bank of Canada Eyeing Rate Cuts
The economists think that following an unprecedented increase in home interest rates Canada during the past year, economists believe that the Bank of Canada may now be moving towards reducing rates – which could have an impact on the housing market in Canada.
Ercolao at TD Bank noted in an analysis note that the early housing market data from December suggested a robust selling activity, with listings falling dramatically across major markets.
He added: “In the fourth quarter production is expected to experience an unexpected decrease than previously thought prior to experiencing a slight recovery in activity owing to lower bonds rates.
“BOC will closely monitor the housing market since homes are expected to be purchased in spring. This are expected to coincide with decreases in the interest rate.”
Ercoalo stated that the upcoming announcement on currency depreciation on January 17 could show dramatic fluctuations resulting of the underlying impact, as the depreciation rate was not as high in the past.
He said, “However, currency depreciation is trending in a positive direction. We anticipate that it to drop below the 3 percent in 2024.”
Home Prices to Rise in Future, According to Royal LePage
Royal LePage released in mid-December an estimate that suggested Canadians might be in for a 5.5 percent price increase home interest rates Canada this year if compared to 2023.
Canadian real estate franchisee predicts the average home will be sold for $843,684 by 2024.
This scenario assumes that it is the case that Bank of Canada will end its rate hike program and keep its prime lending rate steady at 5% by the beginning of 2024.
Royal LePage indicates there is an expectation that the central bank could make a small reduction between the end of spring and early fall of 2017.
Ercolao suggests that the speculation about markets is centered around an expected rate cut in the first quarter as suggested by BOC at their April meeting.