With 2011 wrapping up, it's time for everyone to peer into their crystal ball and attempt to predict the future of real estate and mortgage rates in Canada. Below are some of last week's more notable predictions:
- The Economist says that Canada is one of nine countries whose housing market is overvalued by 25% or more “ and with prices hovering around those of the U.S. housing crisis, the article surmises a bust is imminent. The theory is dismissed by many, however, including Ben Myers of Toronto's Urbanation, who says the Economist's methodology is flawed because it's too simplistic. It also completely ignores the strength of our banking sector.
- In the wake of Canada's most recent disappointing job numbers, the Financial Post wonders if variable rates are on their way down. David Madani, of Capital Economics, believes the Bank of Canada might cut its lending rate by 0.5% starting in April due to global economic uncertainty.
- With 10-year rates at an all-time low of 4.39%, many are wondering if fixed rates might be on their way down in the short-term as well.
Confused? You're not alone. We will be watching the market like a hawk.
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