Bank of Canada to raise rates 25 basis points on July 12, possibly the last: Reuters poll
www.reuters.com
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The Bank of Canada will raise interest rates by a quarter-point for a second straight meeting to 5.00% on July 12 following a five-month pause earlier this year and then hold well into 2024, according to a majority of economists polled by Reuters.

Raising rates seems to do two things to housing:

  • encourage targeting luxury housing - if you’re rich, prices aren’t as important
  • encourage selling to larger landlords - more apartments, fewer condos/townhouses

Builders are still going to build, they just need to target people who can afford the higher prices.

Looking at the construction industry in Quebec, builders aren’t building anything… There’s zero clients right now…

Avid Amoeba
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21Y

Meanwhile in Ontario there’s not enough labor in construction.

The problem is that people increasingly CAN’T afford the prices. Where are all they people that can afford near million dollar homes for 8% interest (or cash) come from?

At best, they’ll be people who are landlords who already have significant wealth and will rent at sky-high prices…

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