The possibility of higher interest rates is worrying homeowners across Canada, but fears of rising costs differ in Saskatchewan, according to homebuilder associations in the province’s two largest cities.
As interest rate speculation continues, one in four Canadians fear they will have to sell their house whether rates continue to rise, according to a recent Manulife Bank survey.
However, the head of the Regina Home Builders Association said while inflation is a major concern for home buyers in the province, the financial impact is relative to the housing market.
“If you had a $300,000 mortgage, in Regina your monthly mortgage payment would go up by $130, and that’s not a small thing, but it should be manageable,” said Stu Niebergall, president and CEO of Regina and Region Home Builders’ Association.
If the Bank of Canada raises interest rates by about 0.75%, Niebergall said he expects many people in Regina will be able to absorb that cost.
“I believe the one in four that Manulife is talking about really reflects the concerns and fears of many other markets in Canada, you think Vancouver or Toronto,” he said.
He points out that Saskatchewan has some of the lowest average house prices in the country.
“You know, we haven’t been through the pandemic, the dramatic increases and housing prices that we’ve seen across the rest of the country,” Niebergall explained.
While Niebergall said residents of his association in Regina weren’t too worried, the Saskatoon Region Homebuilders Association said the pressure was already being felt by residents of Saskatchewan’s other major city.
“I think everyone is feeling the pressures of inflation and rising interest rates, and so we’re hearing anecdotally, absolutely, there’s a lot of pressure there,” CTV told CTV. Chris Guerette, CEO of the Saskatoon & Region Homebuilders Association.
“It costs a lot more today to live stat quo than it did last year, but you don’t get more out of it.”
She said the fear among landlords in Saskatoon and Saskatchewan in general is that with the shift to working from home, people have already had to adjust their current living situation, and now with rising rates, d other adjustments will need to be made.
“That’s the big question, what does it look like in Saskatchewan, we don’t know, but we know there will be an impact.”
The Manulife Bank of Canada Debt Survey was conducted among 2,001 Canadians from all provinces between the ages of 20 and 69 with household incomes over $40,000. The survey was conducted between April 14 and April 20, 2022.
More details to come..