The Bank of Canada said Tuesday it has opted to keep its key policy rate unchanged at one per cent as the risks to the global recovery have increased, led by worries in Europe that renewed concerns over government debt levels could stir up fragile financial markets. Good news for local real estate - bad news of course for the global recovery as Europe continues to garner it's share of attention on government debts and fickle markets - not to mention our friends south of the border dealing with their own demons.
This is very good timing as we are ever so close to the spring market beginning here in Vancouver - sellers will be motivated to list their homes once clear of the holiday season knowing that potential purchasers still have access to funds at record interest rate levels - for now. The next meeting for the Bank of Canada will be held on January 11. Buyers that can get a rate hold early in January which - depending on the lender can last 90-120 days - will have them perfectly placed to entertain making a move on a property well into May. A very key element of late in the Vancouver real estate market - buyers access to attractive lending options - still the major driving factor in most home purchases.
Hours earlier the Australian central bank preceded the Canadian announcement citing the same reasons - caution in Europe and the decision to leave considerable stimulus money in place. This of course is in tune with heightened qualifying benchmarks on lending. The purse is still there but the strings are much tighter !
One interesting statement by the Bank was that the global economic recovery was proceeding as "expected" - although risks have increased. I would say this simply means - it is going to be a long, long road with some curves that may or may not be negotiable - just depends on the speed those in the know try to drive it. With the much shortened statements coming from central banks, governments and economic sources - the lack of prediction most certainly means one thing - lack of certainty. A situation that has investment in real estate becoming a more comfortable option as investors look for stability in these uncertain times.
I encourage and welcome you to contact me anytime with comments and/or questions about real estate in Vancouver.