The Royal Bank recently increased its the five year fixed rate by 50 basis points. A move of 50 basis points is a significant shift.
The move in interest rates is as a result of inflation moving up. The primary driver of inflation is the price of oil. We live in a petro economy. The price of oil has moved from the mid $30′s to the $80 range this year. Along with this increase in the price of oil is a price increase in anything moved by, made by, financed by oil in the past 3 months.
What does this have to do with BC mortgages and real estate… Just about everything.
The consumption of petrochemical products by the housing industry is staggering. The new home industry relies on petrochemicals from the gas they use to get to the job site; to the sheathing used to protect the house from moisture, to the carpeting on the stairs. I think you get the point.
The real issue is the impact on BC remortgage rates. Mortgages are driven by payments and payments are governed by debt service ratios. An increase in rates will impact the ability of homeowners to finance greater debt. The impact on resales may be a decline or flattening in prices.
With some pundits forecasting a 300 basis point increase in BC mortgage rates the future looks interesting.
And with rates still near all time lows remortgaging or debt consolidation will still be affordable…now is the time.
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Are there any more websites that gives detail about debt consolidation?
i would love to have some debt consolidation and have financial freedom in the years to come ‘,: