Tag Archives: Mortgage Rates

Fixed Mortgage Rate Forecast – August 2014

Fixed mortgage rate forecasts over the past few years have been fairly consistent in forecasting continued low mortgage rates in the near term with some upward pressure expected in medium term.  A historical look at the last 12 months however reveals a different reality.  Mortgage rates and the bonds that drive them have actually fallen almost in tandem by a half a percentage point.  Although that forecast remains unchanged today, … Read More

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4 Year Mortgages Make a Comeback

It must be Spring time, the mortgage wars are back.  It seems like a repeat of last year with Bank of Montreal (BMO) reducing the rate on their 5 year “no frills” mortgage to 2.99%.  There’s something about a rate below 3% that kicks off a flurry of responses from the competition.  Along with the usual warnings about the added costs of going with a “no frills” option, the banks … Read More

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Bank of Canada Stands Pat

Yet again, the Bank of Canada decided to stand pat when it comes to interest rates. The Bank announced it would maintain its target for the overnight rate at 1% – a decision that spells good news for variable rate holders.  The primary reason for the decision was low inflation – something that is expected to continue for the remainder of 2014. While consumer energy prices and a low Canadian … Read More

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Fixed Mortgage Rate Forecast – 2014

It appears that an era of consistently low mortgage rates with no significant prospects for increases is about to come to an end.  At least for long term fixed mortgage rates. Mortgage rates are directly tied to the market yield for government bonds of similar duration, and a significant economic stimulus program is beginning to wind down. The US Federal reserve began a bond purchase program in November of 2008 … Read More

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A Look Back at 2013 5 Year Mortgage Rates

Mortgage rates were a hot topic throughout 2013.  Governments intervened in money markets to manipulate mortgage rates in both Canada and the US.  While the US’ quantative easing (QE) program was focused on keeping rates low, Canadian policy makers were busy threatening rate increases and chiding banks for low mortgage rates.  Looking back at 2013 we can see that the US won the rate manipulation game. Quantative easing used the … Read More

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BOC Hints at Rate Decrease

Last week’s Bank of Canada (BOC) rate announcement was a stunning departure from the Bank’s long held position that rates had nowhere to go but up.  Since Stephen Poloz took over as BOC Governor he’s been steadily moving away from his predecessor’s position that a rate hike was imminent, but this recent announcement took many by surprise. Official Bank of Canada announcements are carefully drafted with subtle wording to prepare … Read More

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Variable Mortgage Rate Forecast – November 2013

Variable mortgage rates don’t appear to be going anywhere for at least the next 2 years.  And for the first time in 3 years there’s an equal possibility that the next variable rate change will be either up or down.  This change in the forecast for variable rates has more to do with the new Bank of Canada (BOC) governor, Stephen Poloz, than it does with a change in market … Read More

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Stephen Poloz Balances the BOC

As expected, the Bank of Canada (BOC) kept the prime lending rate at 3% yesterday.  This decision moves the clock to 3 years and 1 month with no change to the overnight lending rate and in turn the prime lending rate.  Currently set at 1% the overnight rate is well below its 10 year average of 2.07% and significantly below the high of 4.50% hit in July of 2007.  The … Read More

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Fixed Mortgage Rate Forecast – October 2013

The fixed mortgage rate forecast for October 2013 is for rates to decline in the near term.  Fixed mortgage rates, particularly the most popular 5 year fixed mortgage rates, are tied to 5 year benchmark bond yields.  Insight into the direction of bond yields provides us with a crystal ball with which to predict near term fixed mortgage rates. The price of bonds have been kept low by the US … Read More

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Fixed Mortgage Rate Forecast – September 2013

The mortgage rate roller coaster continues as bond yields dip 20 basis point last week.  This dip comes as a result of the US Fed’s announcement that it will continue to support its bond buying program known as quantative easing.  The announcement surprised and rallied markets reversing upward march of bond yields. Lower bond yields remove upward pressure on mortgage rates and will eventually allow competitive lenders to lower their … Read More

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