As you might imagine, as real estate experts we keep a close eye on news and developments that may have an impact on the sector (and especially the Kelowna real estate market) and that includes pretty much any announcement from the Bank of Canada.
So when the BoC announced the latest interest rate rise this week we were all over it. Before July of this year, the BoC’s benchmark interest rate hadn’t increased in seven years, however in these past two months we’ve seen two jumps. This week’s announcement takes the benchmark rate to one per cent.
Of course, interest rates have been at historic lows for some time and the rates were always going to increase. Now the moves have started expect to see the trend continue over the months and years ahead.
In the short term, we’re probably going to see this move from the BoC lead to an increase in real estate activity. That may seem counterintuitive if borrowing has become more expensive, but those who have been working on getting into the market will now redouble their efforts as they’ll want to get something locked in as soon as possible before the rates climb further. In the short term, there’s likely to be a slowing effect though.
With this news, you’ll want to continue to work hard to pay down any debt you may have, especially any high interest debt such as credit card debt.
If you’re wondering what impact this news will have on your mortgage, take a look at this useful BC mortgage calculator.
Keep an eye on our blog to stay in the know on news from the Kelowna real estate market and the industry in general, and if you have any questions about the Kelowna real estate please do not hesitate to contact us – we’d love to hear from you.