On July 15, 2015, the Bank of Canada reduced its overnight lending rate to 0.5 per cent from 0.75 per cent. As money lenders typically follow the Bank of Canada, we are likely to see a lowering of mortgage interest rates again. In fact, Toronto-Dominion Bank was first out of the gate, cutting its prime rate by 10 basis points to 2.75 per cent.
Opinions among experts differ, but I see this as yet another boon to the new home real estate industry. With mortgage money even cheaper, the demand for homes may exceed supply, and prices will increase. With the average new home prices in the GTA already at an all-time high, the lower rates will make it possible for more first-time buyers to live their dream of home ownership. In addition, the opportunities for investing are phenomenal.
Through it all, condominiums are sure to remain the popular choice for the spectrum of the buying public looking for a great return-on-demand. The recent Bank of Canada move fuels that trend, and we have continued stability to look forward to.