2023 vs 2024: Financial Planner’s Predictions for Mortgage Renewal Amid Rising Interest Rates

Marked by a sustained rise in interest rates, will 2023 be different from 2024? A financial planner takes stock of what awaits homeowners regarding mortgage renewal.

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While the Bank of Canada has not made any further increases in the key rate since September 6, the financial institution’s strategy could align with a gradual reduction in the key rate.

According to what American experts suggest, the FED could lower the key rate from mid-2024.

In an interview on LCN, Antoine Chaume Legault, financial planner and wealth management advisor at ASSANTE capital, shares the same opinion regarding possible decisions by the Bank of Canada.

“We are seeing interest rate reductions, these reductions will perhaps occur in the middle of the year or perhaps more towards the end of the year. The industry average expects a mid-year decline. We see a drop of up to 125 basis points, so potentially a 1.25% drop in 2024,” he says.

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Out of breath by the increase in the price of their mortgage, owners who have chosen a variable rate will thus have “more room to maneuver”, underlines the expert.

Faced with the persistent inflationary context, the latter warns consumers regarding their mortgage renewal.

AFP

“On the other hand, we definitely have to be careful. We must review our budget, review our economic conditions for 2023,” he suggests.

For future owners, they must not throw in the towel, while tools like CELIAPP will allow young adults to access property.

“Young people need more and more support from parents in order to have access to property […] for 2024 and 2025, with rates likely to fall more or less quickly, this risks giving momentum,” concludes Mr. Chaume Legault, specifying that the real estate market is currently experiencing a “slowdown.”

*Watch the interview in the video above*

2023-12-31 20:27:08
#Mortgage #renewal #homeowners #benefit