BCREA: Mortgage Rate Forecast June 2022
BCREA has released it’s latest mortgage rate forecast. To summarize their report:
- In the last report BCREA forecasted that the 5 year fixed mortgage rates would reach 4% later in 2022. Instead they are at 4.69% to battle inflation.
- Bond markets expect very aggressive Bank of Canada.
- Expecting the 5 year fixed mortgage rate to reach 5% which is the first time since 2009.
- Current Buyers currently qualified at a rate of 6.49% with it likely going up to a 7% qualification soon. This has not been seen in the Canadian market since the early 2000’s.
- Bank of Canada’s main focus is to lower inflation at this time.
Economic Outlook
- Growth in the first quarter of 2022 was 3.1%.
- Likely will see a slow down in growth due to inflation.
- Growing concern that 2023 will see a recession but indicators suggest the economy is not currently in a recession.
Bank of Canada Outlook
- The ultimate end for interest rate increases will depend on the trajectory of inflation over the next few months.
- Some see signs of inflation peaking while consumer and commodity prices continue to rise.
Full Report is included below or download the PDF here.
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