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Bank of Canada holds interest rate steady

Are you a homeowner or homebuyer who is juggling budgeting for your mortgage amidst an ever-changing economy? We have some news for you: The Bank of Canada has announced that it will hold its benchmark interest rate steady. This positive news could mean savings in your pocket and lower overhead expenses on housing if inflation. Assuming of course that as projected by the Bank, slows down this year. Read on to learn more about how this decision can affect you as a homeowner or prospective buyer.

The Latest Bank of Canada NEWS

The Bank of Canada held its breath, keeping interest rates at a steady 4.5 per cent, bracing for the impact of its previous hikes to settle. Economists were expecting this decision, after the bank’s announcement that it would take a break from raising rates. The bank had raised rates eight times between March 2022 and February of this year. Stemming from their aggressive campaign to increase rates after the pandemic’s early days, when they slashed the benchmark lending rates. With inflation soaring, Canada’s inflation rate reached its highest level in decades, peaking at over eight per cent in June 2022. This before cooling to just over five per cent by February 2023. Stay tuned for next week’s data on March where it is expected to show continued progress downward.

What’s Next for the Bank of Canada RATES?

The Bank of Canada has made the wise decision to hold off on any major policy changes. At least until further notice due to the cooling of inflation. The latest Monetary Policy Report predicts that the official inflation rate will dip to three per cent in the coming months.  Eventually, it is expected to reach the bank’s target rate of two per cent next year. Governor Tiff Macklem acknowledged the relief that Canadians will experience, but also emphasized that their work is not done until price stability is fully restored. The destination is clear and the bank is determined to stay the course.

Have Rate Hikes worked to battle Inflation?

The bank’s top officials are keeping a close eye on inflation. They indicate they will not hesitate to increase rates again if necessary. However, it is confident that the current rate hikes have been effective in achieving the desired results. Deputy Governor Carolyn Rogers did note that the previous increases have already slowed down consumption and restored economic balance.


Mortgage Pre-Approval Survival Tips

Buying a home is an exciting experience and a significant financial decision. It’s important to take every precaution to ensure that it will be a successful purchase, and one of the best ways to do this is through mortgage pre-approval. Mortgage pre-approval gives you guaranteed access to the funds needed for your desired home loan, as long as you are approved by your chosen lender. To make sure your mortgage pre-approval process goes smoothly, we’ve gathered some useful Mortgage Pre-Approval survival tips that you should know. Read on to learn more about how you can successfully navigate the mortgage process with ease.

Finding a Home Before Getting Pre-Approved

The excitement of house hunting can easily cloud the importance of getting a mortgage pre-approval. Unless you plan on paying cash for the property, it’s crucial to prioritize this step. You wouldn’t want to fall in love with a dream home only to have your lender reject your application. Taking the time to get pre-approved first is the smarter way to approach the house hunt. Don’t leave your search to chance – get pre-approved and confidently begin your search for the perfect abode.

Do Not Use All Your Cash on the Down Payment

Buying a home is a major investment and requires a solid financial plan. Saving up for a down payment is just the beginning – there are other costs to consider such as earnest money, closing costs, and moving expenses. First time home buyers should not rely on the seller to foot the bill for all closing costs. Furthermore, owning a home comes with the added responsibility of maintenance and repairs, so it’s important to budget accordingly. It’s wise to leave some funds in savings to prepare for unforeseen repairs. Don’t let unexpected expenses catch you off guard – be prepared with a comprehensive financial plan for your home purchase.

Buying a Home is MUCH MORE Than the Monthly Payment

Buying a home is an exciting process, but it’s important to remember that there are costs beyond the down payment and monthly mortgage payments. Lenders often require buyers to prove they have funds for closing costs, which includes money for property taxes and homeowner’s insurance. If the buyer doesn’t make a 20% down payment, they will also have default mortgage insurance which will be added to the mortgage principal. And these are just the basics! Homeowners also face expenses like association dues and higher utility bills. It’s important to budget for all of these costs to ensure a smooth transition into homeownership.

No New Debt After Getting Pre-Approved

The news of being pre-approved for a home loan can give people a sense of invincibility. Suddenly, the world seems full of possibilities and obstacles seem conquerable. However, it’s crucial to remember that this pre-approval is based on the borrower’s current debt situation. Financing a new car or furniture may seem enticing, but it can actually jeopardize the pre-approval status. Any new debt can cause lenders to reconsider and potentially cancel the pre-approval altogether. So, it’s important to resist the temptation to make big purchases before finalizing the home loan process.

Do Not Try to Save Pennies by Doing Everything Yourself

For first-time home buyers, the excitement of purchasing their dream home can lead to foolish decisions like handling all real estate negotiations themselves. The consequences of skipping important steps like a home inspection and property survey could be catastrophic. This is arguably the most important mortgage pre-approval survival tip! A seasoned agent can help locate the perfect home, negotiate a fair price, and entertain any potential issues that may arise. Keep in mind, the agent representing the seller is working in their client’s best interest, not the buyer’s. That’s why it is critical for buyers to have their own agents to advocate for their needs.

Anxious woman looking at laptop screen while biting on pencil.

Tax-Free First Home Savings

The Canadian government has introduced a new and exciting program called the Tax-Free First Home Savings Account, which will launch on April 1st, 2023. The program is designed to help young people save for their first home purchase by offering tax savings benefits. Contact Callum Greig today to get the ball rolling on this initiative.

How it Works – Tax-Free First Home Savings

Under the program, eligible members can put away up to $40,000 per person or $80,000 per couple in a special tax-free savings account. The balance in the account can be accessed anytime without incurring taxes when it comes time to make your down payment on your first property purchase. This program is in addition to regular TSFA accounts which also enjoy tax-free savings status. AND just like an RSP contribution the Tax Free Savings is also tax deductible.

This program is great news for those trying to save for their first home. It will allow them to accumulate greater savings than with other programs that only offer tax credits or rebates. Plus, you won’t have to worry about paying taxes when you withdraw funds from the account for use as a down payment on your home.

Who to call – Tax-Free First Home Savings

In addition to the tax advantages of this first home savings account, members also have access to financial advice from mortgage brokers who are knowledgeable about this type of saving product and familiar with its various rules and regulations. This service can be invaluable when determining the best financing options available and applying for mortgages.


Individuals can also combine their Tax Free First Home Savings Account with other incentives such as RSP HB Plan. This will make it easier to access additional funds which will go towards their dream home’s down payment. Finally, prospective homeowners have more flexibility when planning their finances and making decisions around purchasing.

Are thinking of buying your first home and looking for ways to save money before taking out a mortgage loan? Look no further than the Tax Free First Home Savings Account. Inquire today to learn more about this incredible opportunity.  Plan ahead and start benefiting from these amazing tax savings benefits come April 1st 2023.