The Canadian dollar has been on a tear lately, and it looks like December could be the beginning of a major run as the nation’s real estate market rebounds. Recent signs point to Toronto and Vancouver being the beneficiaries of this reversal. Home sales through the third quarter of this year in both cities hit a record high. As home sales reach new highs, buyers have started loading up on homes in North America’s most expensive housing markets. And with Canadian property market rates rising, investors stand to benefit even more as prices begin to climb even higher.
So why are we seeing such great Canadian dollar gains? One big reason is that interest rates in Canada have remained quite low due to the recent global economic slowdown. When interest rates rise, usually real estate related costs go down with them. As a result, Canadians are seeing a good deal of equity building up in their portfolios, and they’re taking advantage of it.
Another factor that has helped make for a Canadian real estate investment boom is the fact that the government has recently taken measures to stimulate the economy. For example, the federal government has injected billions of dollars into the market via the Canada Infrastructure Bank – or otherwise known as the stimulus package. This has helped make Canadian exporters competitive with their American counterparts, and it’s also helped make our country less dependent on U.S. exports. As a result, we’re getting more of our goods abroad, and the result is lower prices for our goods and services here at home. In short, we’ve been pretty lucky this year.
Why are we seeing these great Canadian dollar gains when house prices start to rise in both cities? The answer is really simple. Canadians are buying more real estate than ever before. When prices start to rise, suddenly everyone else has priced themselves out of the market, because the price has gone up so much for them that they can’t sell. But first…
Which leads us to our next point. In addition to Canadians buying more real estate than ever before, we Americans are also taking advantage of the low interest rates right now. Interest rates are very low in the United States, which makes for very attractive real estate pricing situations. It’s just as if Canadians have been waiting for the Federal Reserve to change the tone of the interest rate. And the Federal Reserve is considering raising interest rates.
Which means Canadians, and especially homebuyers, now have a rare chance to buy a low-priced home. You might be wondering why interest rates are being looked at by the Federal Reserve – well, it’s all about balancing the national budget. And interest rates are a major component of the budget. If they go up, well, that’s a bad thing, right? It’s easier for a homebuyer to get a low-priced house if interest rates are low.
Now then, homebuyers should understand that while this is a wonderful time for homebuyers, things are not so rosy across the Atlantic coast either. While Canadians have been able to weather the storm in the real estate market, we Americans have been dealing with some very high mortgage rates recently. As a result, many American homebuyers find themselves without a home to live in. That’s not good news for those who are trying to buy real estate in Canada.
Okay, so how do you buy when these things happen? Well, you could take a Canadian house loan. Yes, those mortgages have been increasing in value recently, which makes it easier for you to buy an expensive house. If you want to make sure that you are getting a good deal on your Canadian house loans, you should use a mortgage broker to help you out. With a mortgage broker, you can ensure that you are getting a good deal on your house prices and get on the road to owning that dream home of yours.