How This New Mortgage Trend Could Affect You
- GreenSpace Mortgages
Categories: Home Equity Loan Mortgage Services Refinance Mortgages
Since March 2022, The Bank of Canada has increased the target interest rate from 0.25% to 4.25%. So now, more than ever before, Canadians need help to qualify for loans and mortgages.
However, for Canadians looking to buy their first home, all is not lost. The higher mortgage rates will lead to lower home offers and, eventually, lower costs. Therefore, after the housing boom in 2021 and 2022, house prices are expected to decrease.
What caused the housing boom?
Over the last two years, the interest rate was the lowest since May 2010 due to COVID-19. The pandemic made people focus on acquiring properties, as lower interest rates allowed borrowers to qualify for more money, so house prices skyrocketed. But now that interest rates are higher, borrowers who snapped up low-variable mortgages are seeing their rate double or even triple. For example, someone with a $500k mortgage could see a payment increase of $600 per month ($7,200 per year).
So the increased interest rates affect first-time buyers and homeowners as their mortgages become considerably more expensive. Therefore, Canadians must focus on limiting expenses and saving money as the cost of living has risen sharply.
Get in touch with us today!
If you face challenges qualifying for a mortgage, talk to a mortgage agent at GreenSpace Mortgages today. We understand that every client faces unique challenges, so we offer tailored solutions. We also provide our clients with a budgeting tool so that they can best manage their finances and spending.
Our services include new mortgages, mortgage refinancing, home renovations, debt consolidation, and variable-rate mortgages. We serve clients across Guelph, London, Woodstock, Kitchener, Waterloo, Hamilton, Burlington, Oakville, Mississauga, Toronto, and the surrounding areas.
To learn more about the mortgage services we have to offer, please click here. If you have any questions about interest rates, please get in touch with us by calling (905) 288-7127 or emailing info@GreenSpaceMortgages.ca.