Quote:
Originally Posted by johny
Thats gay. why are fixed rates going up when the BOC and bank prime isn't?. the fixed rates droped way less then BOC and bank prime rates. fixed rates should still be going down not up.
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Fixed rates are based on the long-term, while prime rates are based on the short-term.
This is very simplified:
The economy still sucks, so short-term rates must stay low to keep the economy chugging along. Yet investors are seeing hope for a recovery, so long-term rates are increasing to entice investors to keep buying bonds instead of switching to stocks now that they are having better returns.
Quote:
Originally Posted by johny
oh well. I locked in a rate a couple weeks ago for 120 days. but with no raise, and lots of layoffs at work. I won't be buying anything this summer as I had thought about.
unless I'm lucky and interest rates go to 15% within the next month, causing house prices to drop 50%. then I'll I have 3 months to go look / buy at the low rate  |
I think this is a dead-cat bounce, no way oil should have gone up this much this quickly. So what you're seeing a temporary spike in prices that will fall and hopefully bring rates down again by year-end.
If I were you I would wait till next fall to buy. Rents are cheap compared to purchasing right now, use the money you save renting to put down a bigger downpayment.
Property values drop after the Olympics, I cannot find a single Olympic city where this did not happen. Add to that:
- Vacancy rates are up in Vancouver
- There's more unsold inventory now than at the height of the bubble. Weird, since usually people hold onto properties when they go down in value to ride out the decrease till the next gain.
- There's LOTS of developments speculated to finish in early 2010, adding more unsold inventory to the already increased number.
- Unemployment just spiked
- Lots of construction projects will finish by 2010, adding more people to the unemployment line.
- Mortgages rates are going up, so that'll knock even more of the decreasing number new buyers out of the market.