Personal Finance Guide

At the end of October the Bank of Canada reported it was to hold interest rates at the current level of 0.25%. This judgment was exactly what experts conclude to be the way forward for Canada.

The low figures have already been in force for 6 months and the bank want to keep it for another 8 months at least. As any real estate agent would tell you, one of the key factors in the property market recovery and continued prosperity in that area are these low interest rates.

Sadly there is always a few that call for interest rate hikes. Due to big economic growth in certain areas many individuals are being very guarded. By increasing the rates of interest, many believe this will stop the bubble from exploding. Despite rising prices and a faster pace in the real estate trade, most of the experts state it is not the time to raise rates.

Canada’s overall economic performance did not follow the BoC’s forecast of a 2% rise for the third quarter of 2009 and this is why most professionals don’t believe an interest rise should occur. While there are still large debts within the domestic industry, experts believe that increasing interest rates will damage the recovery which is already painstakingly slow.

At this time there’s also no evidence that leveraging is on the increase, whilst this has its risks, it’s also a sign that the market is more sturdy. There’s more confidence around due to inflation running at about -1%. The other ingredient, is all this is the property market, which doesn’t seemed to have crashed as anticipated. Properties passing through realtors office’s remain steady and prices are rising. With the property downturn last winter there was a backlog of properties which are now selling, as the demand is greater so the prices rise.

Even though there are never any guarantees it is fairly positive that the BoC will fulfil its assurance to keep the interest rates low for a good few months yet. This means good news to any possible home buyer.

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