Earlier this year, we discussed in my blog What The 1.5% Interest Hike Means for You and how this interest hike will impact you and your mortgage.
As of July 13th, 2022, the Bank of Canada had raised the Interest Rate 100 points. Today, the current interest rate in Canada is 2.5%. Since 1998, this has been one of the highest interest hikes we’ve seen.
With these rising interest rates, we’ve seen how these rates impact both variable-rate and fixed-rate mortgages. However, we didn’t discuss how these interest rates will be impacting the real estate market.
The Cooling Effect
If you’re looking for a home, you might be noticing that the real estate market has been cooling down. With these heightened interest rates, we’re seeing sellers slash the prices of their homes thus creating a cooling effect.
On the other hand, even though the real estate market is cooling we’re also seeing a hot rental market. Sellers are terminating their listings and turning to the rental market.
Higher Interests Rates / Less Buyers
Today, because of the rising interest rates, home sales have decreased by 47% in comparison to July 2021. Even though homes are being sold at lower prices, this doesn’t mean homes are becoming more affordable. With the rising interest rates, more people are failing the stress test to qualify for a mortgage.
If you’re thinking of buying a home, you need to have a knowledgeable and well-versed real estate agent by your side. There are so many benefits to working with a real estate agent who has expert market knowledge and will be able to provide you with professional guidance and support during this unpredictable real estate market.
Call Zoie Conforti Today!
If you’re looking for an experienced realtor in the GTA area who knows the ins and outs of the real estate world, then call me today at 647.293.8773 so we can achieve your real estate goals together!
Real estate is in my blood! My entire life, I have been exposed to the intricacies and complexities of the real estate spectrum from resale and land development to pre-construction and closing. I not only can make your homeownership dreams come true, but I have the experience to get your home on the market and sold in no time!