Wednesday’s interest rate decision, which brought the policy rate up to 2.5 per cent and sent a statement about the Bank’s resolve in combatting inflation, came after markets had already largely priced in a 75-basis point hike. Housing markets have been cooling off rapidly since the prospect of a rate hike cycle pulled demand forward into the latter parts of 2021 and the first months of 2022, ahead of the Bank’s first hike in March, and Wednesday’s move will do nothing to reverse that trend.
James Laird, Co-CEO of Toronto-based mortgage brokerage Ratehub.ca, is one of the market watchers who was expecting a 75-point hike. Prior to Wednesday’s announcement, Laird told the Financial Post that a supersized hike to the tune of 75 points or even a full percentage point would do less to impact the housing market than the actual language in the monetary policy report and whether it provides more clarity as to the path of future rate hikes.
“One thing about this upcoming announcement is it’s been … three, four weeks at least that the whole country has been expecting 75 basis points,” Laird said a day before the rate decision. “It’s not going to surprise anyone when it is 75 basis points.
Laird added that he believed Canadian real estate markets have had the time to absorb the news of a colossal hike and does not anticipate any “knee jerk” reactions, assuming the hike is between 75 or 100 points. “It’s all about that forecast going forward as opposed to what specifically they do tomorrow,” Laird said.Article content
Two months ago the Cons were up in arms that the housing market was over-inflated. Prices are too high, what will the Gen-Z do? Now, interest rates will cool the housing markets, and lower prices. Prices are falling how will the Boomers get value for their homes?
Luckily it will affect your shitty journalists because they are paid peanuts for their terrible work.
You will own nothing and you will be happy