In 1971, the interest rate for a mortgage was 7.33%. If you waited for interest rates to go down, you wouldn’t have purchased a home until 1993. You would have rented until 1993. You would have rented for 22 years waiting for rates to go down, meanwhile the value of real estate quadrupled.
Don’t wait to buy real estate. Buy real estate and wait. Marry the house, date the rate.
Then I read an article from the Bank of Canada and summarized it as follows:
The Bank of Canada says households can weather higher borrowing costs because they are proactively adjusting to higher interest rates and defaults remain well below normal averages. While payments have risen for about half of the country’s mortgages, households have higher wages and savings, and they’re adjusting their spending patterns.
That doesn’t sound like the Bank of Canada is in a rush to drop rates much? I still think the Bank of Canada will drop their rate in June or July by a quarter percent, but anticipate any further drops will be smaller and spread farther apart than previously predicted.
Predicting the highs and lows of mortgage rates is like predicting the weather in 6 months. So getting in the market is still a good idea, and staying in the market is important as history clearly shows us.
Do you have questions about getting into the real estate market? Contact me today, I’d love to help!
