this post was submitted on 13 Jun 2023
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Bank of Canada Expected To Hit Market With Two More Rate Hikes: BMO (betterdwelling.com)
submitted 2 years ago by [email protected] to c/[email protected]
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The Bank of Canada (BoC) surprised the market with a rate hike last week, and BMO doesn’t think it was the last one. Canada’s economy is running so hot, the market now expects at least two more rate hikes. It’ll almost certainly lead to higher mortgage rates, which will throttle demand for housing at these prices. That’s not just a coincidence.

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[–] [email protected] 3 points 2 years ago

If they continue increasing, that again ruins affordability by increasing mortgage costs, which is the biggest expense for majority of people.

This is not quite true. Yes for the ones that have significant mortgages left and have signed / renewed recently. But that's likely not most people. For new mortgages that start in the high interest climate, the overall cost will be similar to the typical one as prices are already lower. For the whole of Ontario, there are ~200K real estate transactions per year. Over the span of 5 years, that's 1M. While inflation affects everything and everyone, outaized mortgage costs due to the affect a minority of the households.