Posted at 2:00 p.m
written in the sky
It was written in the sky that one day interest rates would rise. The economy is cyclical and the last one ended up breaking all longevity records with its rates. Now we must come back to earth and embrace the increases to come. What is certain is that these hikes will hurt, as Canadians’ over-indebtedness will have dire consequences for many.
Christian Boily, Rouyn-Noranda
The Bank of Canada has already taken too long to raise interest rates. Also, she’s now adjusting with what I feel are insufficient increases. It would have taken a 75 basis point move higher this week for a strong signal. I’m retired and inflation is my worst enemy. I also remember the 20% interest rate on mortgages in the early 1980’s.
Yves Bourassa, Maurice
A little breather
I hope the bank will raise interest rates to at least 3%. Real estate prices have skyrocketed, among other things due to low interest rates. This makes access to property very difficult for our youth. This increase will surely cause property prices to fall. In addition, there should be an impact on consumption levels, which should also decrease. It should have a broader impact on manufacturing output. So less greenhouse gases in the atmosphere and maybe a little breather from the labor shortage.
Price to be paid
That’s the price of trying to fight inflation. Much easier than paying over 6% inflation, which applies to everything, not just our mortgages and debt.
Pierre Huot, Cowansville
manage inflation better
We are happy about the rise in interest rates. Being retired allows us to better manage inflation without diving into our inheritance money reserved for our daughter and granddaughters.
Rising interest rates are already affecting the number of properties for sale. There were 395 properties for sale in our region last December. Currently it’s more than 600. Before the pandemic it was more than 1000. So the market seems to be slowing down. If interest rates rise to 3%, there will be fewer buyers. Those who need to renew their mortgage will see their monthly payments increase, that’s for sure. The stock markets have been very volatile for me since January and my pension fund is falling very quickly. Enough to tell me that as soon as the stock markets hit a slump, I’ll move into safe haven investments that will yield less returns but allow me regular returns!
Serge Leduc, Pincourt
How am I supposed to cope with a 3% interest rate hike? Quite simply by drinking a good coffee and thinking about the people who will complain about this increase. In 1983 we, the young people of that time, paid 20% of our mortgages. People living beyond their means didn’t find it funny, some had to put their house keys in the bank, others more so low profile, only need to lower their mortgage amount to get the same monthly payments. It will be the same today. Young people want the big house, two cars, trips south, pedigree dogs, and find their pants on the floor even if interest rates go up a few percentage points. Count yourself lucky, young people, that this future rate hike will not reach the 20% of 1983. You’re fat and you don’t even know it.
Guy Sirois, Quebec
save the day
Our daughter bought a home after a horrendous overbid that smashed the asking price by $150,000… Every time the interest rate increases by 1%, her monthly mortgage payments increase by $350. With a 2% increase, we reach $700 per month. She has already reached the maximum of her ability to repay to finally get a house, after often losing her appetite to buy. No question of the unforeseen in such a situation. We had warned her but she remained confident that the potential climb would not happen. Who do you think will balance the deficit to avoid a bank failure and financial foreclosure? Almost $10,000 a year with that 3% rate hike just to save the day. We’re a long way from Mr. Legault’s $500 gift!