Yellowknife real estate brokers are urging homeowners and buyers not to panic following the Bank of CanadaSA国际影视传媒檚 interest hike.

The Bank of Canada raised its interest rate from 1.5 to 2.5 per cent on July 13 SA国际影视传媒� the largest single increase since 1998 SA国际影视传媒� in an effort to curb runaway inflation.

SA国际影视传媒淚 donSA国际影视传媒檛 think itSA国际影视传媒檚 going to crash our market by any stretch of the imagination,SA国际影视传媒� says Kim Knutson of RE/MAX.

SA国际影视传媒淥ur interest rates have been unnaturally low for so long that it was bound to happen that we were going to have rate increases. I mean, it wasnSA国际影视传媒檛 that many years ago, five per cent was was very common, five to seven.SA国际影视传媒�

She says autumn is also generally a time when the housing market slows down anyways.

She acknowledges the increased interest rates will make it harder for some prospective homeowners to get approved for a mortgage, SA国际影视传媒渨hich I donSA国际影视传媒檛 think is a bad thing, either. And I definitely donSA国际影视传媒檛 encourage people to max out their (borrowing).SA国际影视传媒�

Even if the interest rate increase wonSA国际影视传媒檛 be a catastrophe, the housing market in Yellowknife is already out of reach for many individuals and families. The cost of housing in Yellowknife reached an all-time high in 2020, in part due to the disruption of the Covid-19 pandemic. Beyond housing prices and mortgage rates, a 2019 survey found 42 per cent of residences in the territory had at least one major problem.

Rod Stirling of Coldwell Banker, a Yellowknife real estate broker for 38 years, says interest rates will likely still remain low compared to even a few decades ago.

SA国际影视传媒淧eople that have bought big consumer loans in (the last few) years here, they certainly were the benefactor of historically-low lending rates, but thatSA国际影视传媒檚 just not sustainable,SA国际影视传媒� he says.

SA国际影视传媒淏ack many, many years ago, people were still buying and selling real estate, and, you know, rates were twice what they are now.SA国际影视传媒�

However, he acknowledges the rate increase will make things difficult for first-time buyers.

SA国际影视传媒淚t certainly is a frustration for some people that are getting into the market right now,SA国际影视传媒� he says.

Stirling advises potential homeowners who are thinking about a purchase to make a decision soon before mortgage rates increase in response to the Bank of CanadaSA国际影视传媒檚 rate hike.

SA国际影视传媒淧robably sooner rather than later would be a good way for people to go, I think,SA国际影视传媒� he says.