As of Wednesday, the BoC’s overnight lending rate has risen to 5.0 per cent for the first time since 2001. Housing experts are warning that this heightened interest rate environment is putting additional pressure on Canada’s crowded rental market as demand to buy investment properties has fallen given the escalating costs.
“People who can’t come up with an outsized down payment for an investment unit will likely have a harder time holding onto one if they do buy simply because of the rate hikes,” Martino said. The interest in buying an investment property in some of Canada’s largest cities is declining, Kevin Lee, chief executive officer of the Canadian Home Builders Association , told BNN Bloomberg in an interview.
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