Residential Market Commentary - September 21, 2015
Sep 21, 2015, 13:44 PM
Both the U.S. Federal Reserve and the Bank of Canada have decided to leave their trend setting interest rates where they are. In the States that is 0 – 0.25%. In Canada it is 0.5%.
The U.S. Fed appears to be more concerned about volatility internationally, especially China, while the BoC is focusing on getting inflation above 2.0% without assistance from a falling Loonie.
Market watchers now see December as a likely date for an interest rate lift-off in the U.S. – probably a 25 bps increase. In Canada at least one of the big banks sees our central bank staying on the sidelines until 2017.
Low rates continue to fuel the Canadian housing market. In its latest forecast CREA is calling for a 2.0% price increase in 2016, for an average of more than $442,000. Of course Vancouver and Toronto (which account for 60% of Canada’s real estate activity) will skew what is a softer and more balanced market in the rest of the country.