Economics
Bank of Canada Warns Home Buyers Rates Will Eventually Rise
- Macklem says financial system proved resilient through Covid
- Also flags mortgage quality, climate miscpricing, crypto risks
This article is for subscribers only.
Bank of Canada Governor Tiff Macklem said recent gains in home prices aren’t sustainable and warned households against taking on too much mortgage debt because interest rates will eventually rise.
In an opening statement at a press conference to discuss financial stability, Macklem said some households have taken on “significantly” more debt, with many carrying very large mortgages relative to income. Borrowers and lenders need to understand that interest rates won’t always be at historic lows, and home buyers won’t be able to rely on rising values.