Interest rate hike impacts Calgary housing market

By Logan Stein and Chim Uguru

Wednesday’s interest rate hike could be another blow to Calgarians’ wallets.

Mortgage payments are up for many people, and renters are also dealing with huge price increases.

This is the sixth time since March interest rates have been raised in the hopes of tackling inflation.

Christopher Audette, realtor with RE/MAX, says rising interest rates are heating up the housing market in Calgary.

“It really feels like the sky is falling for a lot of people right now. Really, we’ve just become very accustomed to extremely low — historically low — interest rates and we are just coming back to more of a normal situation right now,” said Audette.

He adds the higher cost of living and higher mortgage rates is having a huge impact on housing sales.

“It’s not necessarily falling but you’ve got to be careful with what your doing and not over commit yourself to large mortgages and purchases that you really can’t afford if something goes side ways,” Audette advises.

READ MORE:

He believes that as more people stay in the rental market, or re-enter it, they create more demand for somewhere to live. He says people need to consider what the safest option is for them.

Audette says no matter how you look at it, things are difficult for Calgarians.

“First time homebuyers are definitely the hardest hit in this market,” he said. “It’s becoming tougher and tougher for people to save for an adequate down payment in the face of a recession, their incomes become impacted as well, and the amount that they will qualify for on a new purchase are being lowered as well.”

Audette says Calgarians have been relatively lucky in the past five years, as the price of an average home remained stable, while the rest of Canada dealt with soaring home values.

However, he explains it goes both ways; as the rest of Canada’s housing market cooled, Calgary’s remained the same.

“We didn’t increase the way they did, so we didn’t come back down the way they did,” he said.

Audette adds it’s currently a sellers market in Calgary, however, everyone’s situation is different, and it’s important to talk to a financial advisor or mortgage broker for guidance.

As inflation starts to dip a little bit, he says the “hot” rental market could continue with more rate hikes expected in the coming months.

Top Stories

Top Stories

Most Watched Today