This latest survey in Canada says that 25 % of homeowners will need to sell their houses if Interest rates go up any more…
But the Bank of Canada says it needs to keep raising Interest rates indefinitely.
hmmm..
The situation does not look good.
Nearly one in four homeowners say they will have to sell their home if interest rates go up further, according to a new debt survey from Manulife Bank of Canada.
In other News:
Bank of Canada increases policy interest rate by 50 basis points, continues quantitative tightening
The Bank of Canada today increased its target for the overnight rate to 1½%, with the Bank Rate at 1¾% and the deposit rate at 1½%. The Bank is also continuing its policy of quantitative tightening (QT).
Source: https://www.bankofcanada.ca/2022/06/fad-press-release-2022-06-01/
Bank of Canada Governor Tiff Macklem said rising interest rates aren’t expected to derail the nation’s economy and may even produce a “healthy” slowdown in the housing market.
Meanwhile …
The survey, conducted between April 14 and April 20, also found that 18 per cent of homeowners polled are already at a stage where they can't afford their homes.
Over one in five Canadians expect rising interest rates to have a "significant negative impact" on their overall mortgage, debt and financial situation, the survey found.
The Bank of Canada remains on a rate-hike path as it tries to tame inflation, which is now at a 31-year high at 6.8 per cent. On June 1, the central bank increased its key interest rate by half a percentage point to 1.5 per cent.
Additionally, close to half of indebted Canadians say debt is impacting their mental health, and almost 50 per cent of Canadians say they would struggle to handle surprise expenses.
Source: https://www.bnnbloomberg.ca/bank-of-canada-sees-housing-market-slowdown-as-healthy-1.1776541
Many Canadians will need to rely on their solid stock market returns to buy food and other necessities.
This sounds like a recipe for disaster.
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