Despite talks and concerns that Jim Flaherty will intervene in the housing market once again, this should not be an issue worrying Canadians anymore. This is because his first four attempts have apparently worked and avoided a Canadian Housing Crisis. Flaherty has warned Canadians not to take on a high-cost mortgage, as it could be unaffordable as rates begin to rise. This on top of a high consumer debt load would prove for disasters for the average Canadian household. According to Flaherty, he is ‘not worried at the moment’ about a housing crisis but is ‘prepared with contingency plans’ if the need arose. He specifically addressed the Condo market in Toronto and Vancouver and said there were ‘some bumps in the road in regards to the condo market in Toronto and Vancouver’ but still remains optimistic for the overall real estate market.
Household finances and consumer debt have seemed to be the biggest concern and risk to the economy, according to the Bank of Canada. Flaherty has spoken out against stimulus into the US and Europe economies by saying ‘the budget for 2015 will surely be balanced to put Canada in a position of strength’. Canadians have not be fond of all the rules and changes being implemented however, the danger really lies in inflation, according to Flaherty. This is to be addressed at the next meeting of the Group of 20 officials.
Global bond investors have loved the Canadian economy because of our top stable economy, deficit reduction, and decent credit ratings, according to Flaherty. “We can sell anything we produce in Canada around the world, whether it’s in Canadian dollars, U.S. dollars or euros,” in reference to Flaherty’s sales of his government bonds. For the $19-billion divestment of Canadian Bonds in June by foregin investors was caused by ‘some weakness in the Canadian dollar’ according to him. Overall the Canadian dollar depreciated by 1.4% compared to the US dollar this past June, compared to May, the drop was 3%. This bond sale was in part, due to the worry that interest rates rising because of the US Federal Reserve cutting down on their bond purchases. As well as in US and Europe, they are starting to show signs of continual growth according to economists and investors.
Based on this, contact Robert Clancy today to ensure you receive the lowest rate possible while the economy is still in the process of rising rates!