While Canada’s real estate market continues to be a tale of two cities, the fact of the matter is that the overall Canadian housing market remains fairly stable, with price growth expected to slow to about one or two percent in 2015
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Toronto, Canada (PRWEB) April 02, 2015
Canadalend.com, the leading low-cost, private mortgage solution provider in the country, is weighing in on the impact falling oil prices are having on the Canadian real estate market and mortgage rates.
“Oil prices have been in sharp decline since the summer of 2014, on the heels of weak demand, increased supply, and record inventories. Since July, the price of oil has fallen almost 55% to around $48.00 per barrel,” says Bob Aggarwal, president of Canadalend.com. “In Canada, crude oil accounts for about 14% of exports. As a result, depressed oil prices are having a negative impact on the Canadian economy.”
Stephen Poloz, the head of the Bank of Canada, said that slumping oil prices are having an atrocious effect on the Canadian economy. To counter falling oil prices and a weak global economy, the Bank of Canada lowered its key lending rate, which impacts mortgages, to 0.75% in January. The central bank has hinted it will keep rates low for a prolonged period of time and has not ruled out further cuts. (Source: “Bank of Canada chief Stephen Poloz warns oil shock’s effect on economy will be ‘atrocious,’” The Financial Post, March 30, 2015; http://business.financialpost.com/news/economy/bank-of-canadas-stephen-poloz-warns-oils-effect-on-economy-will-be-atrocious/.)
Aggarwal explains that the impact of falling oil prices on consumer confidence is expected to push down Canadian home sales by 1.1%, as average home prices are projected to grow by two percent to $416,200, a smaller increase than last year. That said, the gains are being skewed by hot markets such as Toronto and Vancouver, says Aggarwal. For example, in February, the average price of a Canadian home increased 6.3% year-over-year to $431,000. If Vancouver and Toronto are removed from February housing data, the average house price actually dropped 1.5% to $326,910. (Source: “Average Canadian house price climbs 6.3% to $431,812,” CBC web site, March 13, 2015; http://www.cbc.ca/news/business/average-canadian-house-price-climbs-6-3-to-431-812-1.2993674.)
“While Canada’s real estate market continues to be a tale of two cities, the fact of the matter is that the overall Canadian housing market remains fairly stable, with price growth expected to slow to about one or two percent in 2015,” Aggarwal adds. “A stable housing market means the Bank of Canada will, in the short-term, keep its key lending rates at historic lows. This is excellent news for first-time home buyers looking to step onto the property ladder.”
“One of the best ways to get the best rates with flexible options is to use a licensed agent from Canadalend.com. Because we’re independent, the agents at Canadalend.com have access to mortgage products from hundreds of different lenders,” Aggawal concludes. “With the spring real estate market heating up, the mortgage experts at Canadalend.com will also help clients get pre-approved for a mortgage in 24 hours or less.”
Canadalend.com is one of the largest, most trusted private mortgage brokers in Canada, with skilled, independent, licensed professionals helping Canadians coast-to-coast. Canadalend.com provides its clients with residential and commercial mortgages, home equity credit, debt consolidation, and assistance with financing concerns. To learn more about Canadalend.com, visit the web site at http://www.Canadalend.com.