Until just recently there was a strong consensus that rates would start rising later this year. Then with last week’s downgrading of the United States credit rating, everything has changed 180 degrees.
Peter Gibson, CIBC World Markets was quoted as saying a few days ago, “I think it’s now clear that there are a lot of serious problems in the world and it’s more likely that we’re setting the stage for a sustainably low level of interest rates for a very long time”.
With the U.S. nearly defaulting on their international debt, the historic downgrading of their credit rating by Standard & Poors, and the continued turmoil from the European Union stretching to Greece and beyond, financial volatility will absolutely continue to be the norm. In addition, the U.S. Federal Reserve last week, attempted to calm the stock markets by stating that they would not raise rates until the end of 2013. That’s two years away. The Bank of Canada has little choice but to follow suit. So it is all but certain, that we can expect mortgage rates to remain low for another couple of years, perhaps even longer. So please forget any media hype about rates rising soon. Such negative hype is designed to sell more magazines and newspapers, and is rarely credible.
Folks, this is good news, no it’s GREAT NEWS! House prices, house sales and affordability should now continue to remain healthy. However, with global financial volatility becoming entrenched, the prospect of a ‘double dip’ recession is still not out of the question.
What all this means is that this we have an opportunity of a lifetime to get into home ownership and for existing homeowners to get their financial houses in order. In other words, eliminate credit card debt and lines of credit, STOP PAYING HIGH INTEREST & START SAVING.
For expert advice and financial solutions beyond what you’re bank can give you, please call us to help you eliminate consumer debt and generate wealth. We’ve got you covered.