Interest rate hike leaves uncertainty in Simcoe County
According to economists, key interest rates could jump three-quarters of a percentage point on Wednesday.
The increased rate comes as Canada looks to tame inflation after it reached a four-decade high of 7.7 per cent in May.
Last month, the Bank of Canada rose its key interest rate half of a percentage point to 1.5 per cent, and Wednesday, a jump of 0.75 per cent, will be the third increase of the year.
"Essentially, for every $100,000 of a mortgage, that would result in somewhere around $750 per year," said Steph Quenneville, the owner and broker of Mortage Sense in Barrie.
"Apply that to a $500,000 mortgage, and you're talking about a big number."
The rising interest rate is believed to be one factor leading to the housing market cooling in Simcoe County after record-breaking years during the pandemic.
Houses in Simcoe County were selling on average for one million dollars at the market's peak in late 2021 and early 2022 but have since dropped in price.
"You don't sell a house in 30 seconds. There aren't 17 people waving their cheque books at you. This is normal stuff," said Lance Chilton of Remax Hallmark Chilton Reality.
According to the Barrie and District Association of Realtors (BDAR), although prices have dropped around 20 per cent since the peak, the market remains healthy, with homes selling ten per cent higher than this time last year.
"Earlier in the year, sellers were winning hand over fist now were a little more balanced for buyers who may have been priced out," said Luc Woolsey, the president of BDAR.
The recent news of homes dropping in price comes as a glimmer of hope for new Simcoe County resident Luke Hyde.
The UK native moved to central Ontario in 2018, hoping to purchase a family home eventually. Since then, he's watched prices skyrocket, forcing his young family to rent a while longer to save.
"For me, every one per cent the house rate needs to come down $100,000 to balance itself out, so I'll be paying the same, but I might benefit from that in ten years, maybe," said Hyde.
As first-time homebuyers gauge the market, there doesn't seem to be a clear path back to normality,
The Bank of Canada suggests the rising inflation it's trying to address is caused by domestic and international factors. The central banks say there's excess demand in the economy, while supply chain problems persist around the world.
CTVNews.ca Top Stories
From essential goods to common stocking stuffers, Trudeau offering Canadians temporary tax relief
Canadians will soon receive a temporary tax break on several items, along with a one-time $250 rebate, Prime Minister Justin Trudeau announced Thursday.
She thought her children just had a cough or fever. A mother shares sons' experience with walking pneumonia
A mother shares with CTVNews.ca her family's health scare as medical experts say cases of the disease and other respiratory illnesses have surged, filling up emergency departments nationwide.
Trump chooses Pam Bondi for attorney general pick after Gaetz withdraws
U.S. president-elect Donald Trump on Thursday named Pam Bondi, the former attorney general of Florida, to be U.S. attorney general just hours after his other choice, Matt Gaetz, withdrew his name from consideration.
A one-of-a-kind Royal Canadian Mint coin sells for more than $1.5M
A rare one-of-a-kind pure gold coin from the Royal Canadian Mint has sold for more than $1.5 million. The 99.99 per cent pure gold coin, named 'The Dance Screen (The Scream Too),' weighs a whopping 10 kilograms and surpassed the previous record for a coin offered at an auction in Canada.
Putin says Russia attacked Ukraine with a new missile that he claims the West can't stop
Russian President Vladimir Putin announced Thursday that Moscow has tested a new intermediate-range missile in a strike on Ukraine, and he warned that it could use the weapon against countries that have allowed Kyiv to use their missiles to strike Russia.
Here's a list of items that will be GST/HST-free over the holidays
Canadians won't have to pay GST on a selection of items this holiday season, the prime minister vowed on Thursday.
Video shows octopus 'hanging on for dear life' during bomb cyclone off B.C. coast
Humans weren’t the only ones who struggled through the bomb cyclone that formed off the B.C. coast this week, bringing intense winds and choppy seas.
Taylor Swift's motorcade spotted along Toronto's Gardiner Expressway
Taylor Swift is officially back in Toronto for round two. The popstar princess's motorcade was seen driving along the Gardiner Expressway on Thursday afternoon, making its way to the downtown core ahead of night four of ‘The Eras Tour’ at the Rogers Centre.
Service Canada holding back 85K passports amid Canada Post mail strike
Approximately 85,000 new passports are being held back by Service Canada, which stopped mailing them out a week before the nationwide Canada Post strike.