Category Archives: Mortgage Rates

Fixed Mortgage Rate Forecast – August 2012

Over the past 30 days we’ve seen the 5 year Government of Canada benchmark bond yields edge up 0.20% to a 30 day high of 1.43% as of yesterday.  This bond yield represents the cost of funds for 5 year fixed mortgage rates and as such has squeezed the profit from mortgage lenders.  Although there haven’t been any Canadian mortgage rate increase announcements we have seen the evaporation of some … Read More

Posted in Blog, Mortgage Rates | Tagged , , | Leave a comment

Where’s the Mortgage Rate War?

The summer of 2012 is delivering record low 5 year Government of Canada benchmark bond yields aka the cost of mortgage funds.  If the cost of providing a 5 year fixed mortgage rate keeps dropping you’d expect to see mortgage rates offered to customers dropping as well, but that hasn’t been the case.  In fact BMO Bank of Montreal, the instigator of the last mortgage rate war, is keeping their … Read More

Posted in Blog, Mortgage Rates | Tagged , , , | Leave a comment

Bank of Canada Holds Mortgage Rates

The Bank of Canada announced yesterday that they will maintain the overnight rate at 1%.  This ultimately will keep variable mortgage rates where they are at least until the next meeting date, scheduled for September 5th.  This announcement was uniformly expected by economists and mortgage planners alike. In the announcement Mark Carney downgraded the Banks’ growth prediction for the Canadian economy down to 2.1% for 2012 and 2.3% for 2013.  … Read More

Posted in Blog, Government Policy, Mortgage Rates | Tagged , , , | Leave a comment

Hot Summer Mortgage Rates

The summer of 2012 is shaping up to be one of the hottest on record, and I’m not just talking about the weather.  Record low mortgage rates continue across the country make this the ideal time to buy a home or refinance your existing mortgage.  And you don’t need to worry about over-extending yourself; the government is making sure nobody does. Homeowners can lock in now with a 5 year … Read More

Posted in Blog, Mortgage Rates | Tagged , , | Leave a comment

Higher Mortgage Rates for Rentals

Buying a rental property may not be as good an investment as you think.  When calculating the benefits of owning a rental property many Canadians will assume that the mortgage financing is the same as if you were buying a residence.  This is not the case.  Mortgages on rentals require bigger downpayments, higher incomes and they often come with a higher mortgage rate. It wasn’t that long ago that you … Read More

Posted in Blog, Mortgage Rates | Tagged , , , | 1 Comment

Home Prices Hit Ceiling – For Now

You know we’ve hit the ceiling when one of Canada’s leading real estate companies becomes pessimistic on home value appreciation.  Phil Soper, president and CEO of Royal LePage Real Estate Services is concerned over the recent mortgage rule changes.  “The most recent set of mortgage changes, the fourth in four years, is also the most aggressive.  The cumulative impact of these new regulations has created a significantly higher hurdle for … Read More

Posted in Blog, Canadian Housing Market, Mortgage Rates | Tagged , , | Leave a comment

Fixed Mortgage Rate Forecast – July 2012

Fixed mortgage rates are based on government benchmark bonds yields.  These bond yields are essentially the cost of funds for mortgage lenders who then factor in their operating costs and profit margins before establishing their 5 year fixed mortgage rates.  These days the premium over the bond yield hovers between 1.85% and 2.10%. 5 year benchmark bond yields continue to bounce around record lows in the 1.25% range.  Over the … Read More

Posted in Blog, Mortgage Rates | Tagged , , | Leave a comment

Variable Mortgage Rate Forecast – July 2012

The next Bank of Canada interest rate announcement date is 2 weeks from today with zero chance of a rate change.  In fact, there’s very little chance of a variable mortgage rate change for the next 12 months. Just earlier this year Mark Carney was hinting at possible variable mortgage rate increases sometime this fall, but recent global economic events have reduced that likelihood to near zero.  Dismal growth prospects … Read More

Posted in Blog, Mortgage Rates | Tagged , , , | 1 Comment

Mortgage Rates Not Going Anywhere

The federal government along with the Canadian Central Bank is growing increasingly concerned with our low interest rate environment.  Traditional thinking stipulates that these low rates are un-natural and in time, when the global economy rights itself, interest rates will rise to 6%-7% back to their natural norm.  This is a reasonable expectation although as time goes on the strongest argument in favor of the 6.5% natural interest rate theory … Read More

Posted in Blog, Government Policy, Mortgage Rates | Tagged , , , | 2 Comments

Mortgage Rates New Normal

Here in Canada, the buzz is all about rising mortgage rates.  Interest rates and specifically mortgage rates have been at record lows for an extended period of time and the prevailing logic is what goes down, must come back up.  However as time goes on, we have to start questioning traditional economic logic.  Just because it’s always been that way doesn’t mean that interest rates have to go back up … Read More

Posted in Blog, Mortgage Rates | Tagged , | Leave a comment