New US Fed Stimulus means low mortgage rates, good news for home buyers and home owners looking to refinance in Canada
Matt Chan • September 16, 2012
What does the US Fed Stimulus mean for interest rates and home buyers to buy and current home owners to refinance mortgage?
There is a really good article in today’s Financial Post
Canada has been in a very unique situation in the global economy. For the most part, Canada has been unscathed by the subprime crisis that has affected other G7 countries. Because of low interest rates across the globe, our loonie has been steadily moving up. As of this writing, the loonie is just slightly north of $1.03, the highest level in over a year. Unfortunately, this is not an enviable position to be in because it hurts our Canadian exporters.
This is, however, good news for low interest rates for first time buyers and for current mortgage holders looking to refinance. As long as our currency is high relative to our major trading partners (i.e. the U.S.), Canada would be reluctant to raise interest rates.
The long term outlook for interest rates is still uncertain. For now, if you are a first time home buyer, it is still a great time to take advantage of current interest rates. If you are a current home owner, you should also evaluate your options for a mortgage refinance to consolidate some debt or make an investment.
It will be interesting to see how a long term stimulus will impact Canada over the next couple of years.
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