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Where are interest rates going?

by Sam Perren

246 words (1 minute read)

Originally Published: 2019-02-01




A friend just commented on Facebook:
"Mortgage rates on the rise? Think again. Five year mortgage rates about to drop. Far lower now than a year ago. Why ? Canada's 5 year bond yield is now at or close to a TWO YEAR LOW following the US Federal Reserve removing its expectation of "further gradual increases" from today's statement." 


Also linked this site: https://www.ratespy.com/5-year-canada-bond-yield


I tend to agree with this view, and also saw an interesting few articles  on a recent quiet move my the Bank of Canada. My response:

"Smart observation! also with the recent BoC changes that allow them to purchase CSBs from CMHC, I think the BoC is well aware low rates will be here for a LONG time. Purchasing Canada Savings Bonds will allow the BoC to provide liquidity in the next credit crunch! Article and interesting commentary here: https://www.zerohedge.com/news/2018-11-24/bank-canada-start-buying-mortgage-bonds-canadian-housing-market-cools.  Another interesting article here: https://betterdwelling.com/the-bank-of-canada-officially-began-buying-canadian-mortgage-bonds/"


Moral of the story?

Buy income producing assets, and a prudent amount of leverage (good debt) will skyrocket your ROI.  The clues are in the news! You just need to be watching for them...

Until next time, Happy investing!



About the author: Sam Perren has helped dozens of investment partners acquire real estate, representing over $16Million CAD in purchases with rental income of over $100,000/mo. If you'd like access to Sam's "deal of the week" please click here.  To ask real estate related questions (or any other), click here.

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