Penticton Mortgage Rates Update – July 2022
In our early July Penticton real estate news update we let readers know that the Bank of Canada would make their latest announcement regarding the benchmark interest rate this week. They did so yesterday (July 13) and it was a relatively big one. But as usual, we’re here to filter mainstream media’s take on the matter so that prospective home buyers understand how the announcement may (or may not) impact their decision to get a mortgage this season. Let’s review.
What Buyers Really Need to Know About the July 2022 Bank of Canada Policy Rate Hike
How to Respond to a Full 1-Percentage Point Hike
A few days before this week’s Bank of Canada (BoC) announcement, experts confidently predicted that the BoC would follow the US Federal Reserve’s example of raising their own benchmark rate by 0.75%. That didn’t happen. Instead, the BoC raised it by a full 1-percentage point to 2.5%. This is the biggest move they’ve made since the movie Titanic was released (1998). Is that why buyers have a sinking feeling?
No, it’s because as we mentioned above, the media loves to incite panic.
If you follow our Okanagan real estate news blog then you know we love charts, or should we say “facts”. Let’s have a look at where the BoC interest rate hike stands against recent history:
Yes, compared to the last decade (plus) the 2.5% mark is certainly higher. But let’s not forget what has caused dramatic drops in the Policy rate for the current generation. First it was the financial crisis of 2008. Then there was the government-enforced economic lockdowns of 2020. Once financial crises occur, there must be a correction. We’re now seeing that correction. This is not some “new normal”, it’s simply a normality of economics and real estate that has persisted for over a century. Prospective homeowners are not advised to wait around for a financial crisis to enter the market. If the time has come for you to buy a home, then proceed accordingly. And if you feel better about making historical comparisons, find peace of mind that you’re much better off than those who purchased a home in the first-half of this millennium.
“Prospective homeowners are not advised to wait around for a financial crisis to enter the market.”
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What will that line at the end of the chart above do in the weeks and months ahead? We can say with relative certainty that it won’t come down. It will either stay the same, or increase even further. Should the latter occur (most likely scenario) you’ll kick yourself for not locking into a lower mortgage rate today. Another thing that we can say with certainty, is that you’ll get access to better mortgage rates, terms, and first-time buyer incentive programs by working with Carloni Mortgage Brokers. We have relationships with the Big Banks and alternative private lenders alike. We will effectively lower your downpayment requirements, lower your required monthly mortgage payment expenditure, and lower your overall cost of owning a home. We essentially protect buyers from Bank of Canada announcements that send others into an uproar. Buy your BC Southern Interior home with confidence by contacting Carloni Mortgage Brokers.