Ahhh, the good old days.
Or were they, economically speaking? Let's take the early 1980's as an example.
We bought a home in early 1981 near the bottom of the housing crash caused by PE Trudeau's NEP (National Energy Policy), which dropped that home's value by about 20% from $111,000 to the $91,000 that we paid.
Read more: The Good Old Days, when homes were cheap, or were they?
Your Variable Mortgage Rates are driven by your bank’s Prime Rate which is set individually by each Bank. They normally (but not always) move in sync with changes in the Overnight Rate, which is set by the Bank of Canada (BoC) and is used as a basis for one-day (or "overnight") borrowing between the major lenders and financial institutions.
Read more: Understanding what drives Variable rates and Fixed rates
Here is a very good analysis of this week's Bank of Canada (BoC) Overnight Rate reduction, how the banks reacted, how this plays into Inflation, possible implications on the housing market, and more.
Read more: Analysis of the July 2015 BoC Overnight Rate Cut, a Primer on the current mortgage market, and...
Are low interest rates the new normal? Many are beginning to believe this is indeed the case, while as many others are expecting interest rates to return to more historic normals (ie a Prime Rate of around 6%). Economists around the world are divided on the issue, and they all seem to have a good argument to support their position.
Read more: Low interest rates – the new normal?