Money Trends to Look out for in Canada in 2017

2016 saw many things change for Canadians. Purchasing a home became quite a bit more difficult, more rules were put in place for first-time homebuyers, foreign investors face new taxes, and interest rates rose. So, what does 2017 have in store after all of this?

Here are some predictions for 2017 that may have a direct effect on your life:

Mortgage rates may go up

In 2016, we saw a few of the major Canadian banks raise their prime lending rate, and this trend could definitely continue into the new year. This could mean that the house you were planning on purchasing could end up costing you more than you bargained for. Make sure you’re on your way to saving a sizeable down payment and raising your credit score, to minimize the effects of rising interest rates.

Fewer foreign investors

Foreign investors in Vancouver, one of Canada’s key housing markets, have already dropped off since the government rolled out a 15% tax for non-Canadian homebuyers. As fewer foreign investors bring their money to Canada, there is less competition in the housing market, resulting in lower housing costs.

Housing market will slow

Higher interest rates, fewer foreign investors, and harsher mortgage rules will all lead to a continued slowing of the Canadian real estate market. This could bring the average cost of a home in Canada down, making homeownership within the reach of many more Canadians than it is now.

House prices will drop

It is likely that with all the new rules surrounding buying a home in Canada, as well as the high cost to foreign investors, Canadians may see a significant drop in the cost of homes in Canada. In essence, the real estate bubble in Canada could finally burst, opening new doors to first-time Canadian buyers.

Our economic growth is due to slow

The rate at which Canada’s economy has grown over the past few years is due to slow down. This could see the Canadian economy drop a few spots as one of the largest economies in the world, and it could have a myriad of effects on everyday Canadian life. Job creation could slow, prices could drop, etc. With the changes in the oil industry and the predicted slowing of the housing market, our economy is already beginning to slow.

In short, everything to do with money looks like it might be slowing down. The biggest effects of this should be felt in the housing market, as many Canadians are hopeful the changes in the real estate market will enable them to finally step into the ring as homeowners. The changes throughout the rest of our economy should be minimally felt, as Canada continues with business as usual in 2017.

What are some money trends you think will take shape in 2017? Let us know in the comments!