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Old 12-09-2010, 05:29 PM   #1
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Default Interest Rates to stay the same!

On Tuesday the Bank of Canada announced that they would not be adjusting their prime lending rate and that the prime lending rate would remain at 3%. This will have a direct impact on any variable rate mortgage(s), secured line(s) of credit, or personal line(s) of credit that you may have.
The Bank of Canada feels that the global recovery is proceeding largely as expected, although risks have increased. In Europe, recent data have been consistent with a modest recovery. At the same time, there is an increased risk that sovereign debt concerns in several countries could trigger renewed strains in global financial markets.

The recovery in Canada is proceeding at a moderate pace, although economic activity in the second half of 2010 appears slightly weaker than the Bank projected in it's October Monetary Policy Report. Inflation is in line with the Bank's expectations and as a result, the Prime Lending rate has been left unchanged.

With rates staying low, we are continuing to recommend that clients stay in their variable rate mortgages. Many analysts have now said that they believe the interest rate hikes are now on hold until at least spring and maybe as long as late 2011. Please call us if you have any questions, or if you would like to discuss your best option.

The date of the Bank of Canada's next announcement is scheduled for 18 January 2011.
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Old 12-09-2010, 05:36 PM   #2
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No offense, but getting interest rate forecasting advice from a realtor is like getting candy intake guidelines from Mr. Christie.
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Old 12-09-2010, 05:38 PM   #3
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Originally Posted by amorak View Post
No offense, but getting interest rate forecasting advice from a realtor is like getting candy intake guidelines from Mr. Christie.
This is not me forecasting though...
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Old 12-09-2010, 05:44 PM   #4
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I have the opportunity to get into a 5yr fixed for 2.20, variable 0.95 or mixed 1.55 so I really want to take advatange of that. As you stated it seems most think it will be low for a while so I'm not in a hurry but wouldn't want to miss out of basically 'free' money.
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Old 12-09-2010, 06:14 PM   #5
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^^^^

how the heck are you able to get those rates?!?!?
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Old 12-09-2010, 08:19 PM   #6
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Originally Posted by albertGQ View Post
^^^^

how the heck are you able to get those rates?!?!?
The insurance company I work for is part of a Credit Union and we get 1.25% off the posted rates. Which are currently 3.45 (var.), 2.2 (fixed) & 2.8 (mix). And with the varible you can lock into fixed at any time but that might be the same for all mortgages.

edit: Okay so I lied looks like it can't be less than half the posted rate so the varible would be 1.1% which is still pretty nice!
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Not at all, as I've said, I would rather start with LA over any of the other WC playoff teams. Bunch of underachievers who look good on paper but don't even deserve to be in the playoffs.

Last edited by HOOT; 12-09-2010 at 08:47 PM.
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Old 12-09-2010, 08:43 PM   #7
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Although this is great news for my variable mortgage, an upward move on rates may be an indicator of economic confidence from the boc. To hear that rates may hold until the end of next year could indicate that the boc feels that the economy will continue to remain stale for much of 2011.

Rates have been great for a while now, but it certainly didn't support a strong real estate market in the back half of 2010, and if the trend continues it isn't a great indicator for 2011 either.

Low rates can get first time buyers into the market, but I'd rather see an uptick in buying due to economic prosperity. More stability in that, which consequently would likely mean higher rates.

Lots of different factors beyond real estate play into why the boc adjusts the rate, so it's really tough to predict where things will go.
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