Summary: Fixed interest rates have been decreasing steadily over the past two months. At the same time, the variable rates have increased (the discounts off of the prime rate have decreased). At this time, the vast majority of clients are going with the 3-year fixed rate. |
The changes in rates above in (mostly) green show the difference from 1 month ago.It’s important to note that these rates are not final – we can get better rates in many circumstances. The rate offered is subject to: your lender, date of closing of your mortgage, as well as mortgage size. The sooner the mortgage closes from the rate request, the better the rate, and the higher the mortgage size, the better the rate. |
Quick Economic Analysis: On June 5th, the Bank of Canada (BoC) decreased the overnight rate by 0.25% to 4.75%. This has decreased bank prime rates to 6.95%. It is widely expected that another rates cut may be on the horizon but inflation unexpectedly rose in May, disappointing the BoC as it deliberates the possibility of another rate cut next month. The Consumer Price Index (CPI) rose 2.9% in May from a year ago, up from a 2.7% reading in April. This increase primarily reflects higher prices for services and, to a lesser extent, food. According to a Bloomberg survey, economists had expected 2.6% inflation last month. However, the June inflation data will be released on July 16 (before the July 24 BoC meeting). Barring a significant drop in June inflation, the next interest rate cut will likely be at the September meeting. That’s not good for the housing market, which has slowed to a crawl in recent months across Canada as a whole. Vancouver is still humming along but anecdotally, many buyers are still waiting on the sidelines. Interest rate cuts will be more gradual because rapid population growth has boosted economic activity (more on that reversal below), forestalling a recession and adding to inflationary pressure. Dominion Lending Centre’s Chief Economist, Dr. Sherry Cooper, expects the central bank’s overnight policy rate, now at 4.75%, to gradually move to 3.0% by the end of next year. |
Current Interest Rates
Category: First Time Buyer,
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Why New Condos May Be a Bad Investment
Category: Education and Learning,First Time Buyer,Home Purchase,
Our housing market has been strong and home values have significantly increased over the past several years due to:-Too little construction of new housing, and-Underinvestment in single family housing-A decade of historic low interest rates-Speculation in housing for house flipping,-More investors (mom and pop) as well.-Private/alternative credit/mortgages is helping.-The magnitude of the population boom!!! This […]
30-Year Insured Mortgages
Category: Education and Learning,First Time Buyer,Home Purchase,
30-Year Insured Mortgages The government just released guidelines for 30-year insured amortizations. These extended repayment periods are earmarked for first-time purchasers of newly-built residences and kick off this August. To get a 30-year insured amortization: 1. At least one of the borrowers on the application must be a first-time homebuyer, meaning they meet one of the following […]