The cost of money to buy a home in the Okanagan Shuswap will stay low for a while

Stephen Poloz, the govenor of the Bank of Canada now says that the low interest rates that we have experienced for the last decade will likely become the new normal. There has been the threat of higher interest rates just around the corner for a number of years but it never seems to come. Rates inch up a few basis pojnts and we all say, "Here we go", only to find them inching back down a few months later. The bank of Canada overnight rate stayed at 1% this month as it has been since 2010. Stephen Poloz now states that this is likely to become the new norm. In my opinion what has happened is that Canadians have responded to lower interest rates by buying Real Estate. The have mortgaged a much higher percentage and bought more expensive housing because the interest rates have made it possible to do so. Now Canadian mortgage debt is higher than it has been in years and Canadians are handling it at these lower rates. If the Bank of Canada raises rates some people will not beable to make their payments and the economy will suffer because of it. The bank knows this and their hands are tied. Therefore, they are putting together a new policy to get comfortable with lower rates. Click (here) for the full story. 

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