The Toronto Sun recently reported that anticipated lower interest rates, spurred by the Brexit vote alludes that the Canada housing markets may see downward pressure on rates and may help generate more market activity; while having a moderating influence on British property prices.
The implications of the vote result of the Brexit referendum, concerning the exit from the European Union, will certainly generate long-term effects to be felt across the Atlantic; with ripples extending to the world all over, economically speaking.
Canada’s real estate marketplace may be able to leverage the now altered global financial landscape to its own advantage. Canada could serve as a safer haven for investors seeking more economic certainty. The expected forthcoming market uncertainty over the next half a year could make Canadian investors with global portfolios more nervous – and instead invest more domestically. They just want the stability that Canada’s real estate market has to offer when parking their money.
The vote result should also have a parallel effect on Federal Reserve rates. Therefore, interest rates worldwide are more likely to remain even lower than they have been, for even longer projections than have been cast before – resulting from the deep uncertainty over Britain’s and the EU’s economic fate. It is likely that Canadian rates will sink to all-time lows, keeping mortgage rates at an extreme low; enabling more activity in all sectors of Canadian Real Estate.
Vancouver and Toronto are expected to remain overheated due to more downward pressure on interest rates.
We are also likely going to witness a weakening of the British pound, which would make U.K. goods cheaper to import, but create a higher wall for Canadian exports to the United Kingdom. Also Canadian politicians have been working on free trade agreements with the European Union, which will now have to be tailored to mesh singularly with the UK. That could take our sloth-like politicians years to reformulate.
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