How could a Bank of Canada rate hike impact B.C.’s housing market?
Real estate experts say B.C.’s housing market is heating back after cooling off due to rising interest rates but the future is uncertain as several economists expect the Bank of Canada to hike rates again.
Home sales have rebounded and increased recently, while an overall lack of supply continues to keep prices and demand relatively high. The BC Real Estate Association’s chief economist Brendon Ogmundson says he doesn’t think an incoming rate increase will stop the momentum significantly.
“We will see sales dip a little from where they are today,” he told CTV News. “But, that said, this market has been extraordinarily resilient even with rates as high as they are we’re seeing sales come back to normal levels, so it’s hard to say an extra 25 basis points is going to make that much of a difference.”
Ogmundson also says some changes are already happening in anticipation of a potential rate increase.
“Five year fixed mortgage rates are already beginning to rise and we could see that temper some of the recovery that’s currently underway,” he said.
As a whole, for those on the house hunt Ogmundson has this advice: “Don’t try to time the market. Find something that’s right for you and, crucially, that you can afford and that you are comfortable with affording long term.”