The Bank of Canada announced that it would maintain its overnight rate of 1 percent this morning, thanks to disproportionate growth in the Canadian economy. According to the official release from the Bank, economic growth in Canada was slightly slower than expected in the first quarter of 2012. Even so, the underlying economic momentum appears largely consistent with projected expectations. As such, the latest release from the Bank appeared to ease up on the possibility of an imminent rate hike. However, the overall tone of the piece did little to dispel the fact that rates will increase eventually. Continue reading
Tag Archives: Mortgage Rates
Rates on the Way Up
Canada’s major banks have begun to increase rates, putting an end to near-historical lows across the country. News broke on Monday that several banks would be increasing their rates by 6/10ths of a percentage point, signifying a shift in the real estate market.
The largest increase was attached to the popular five-year fixed closed rate. The posted rates at Royal Bank, Laurentian Bank and TD Canada all went up from 5.25 percent to 5.85 percent. Of course, posted rates are routinely discounted. As such, RBC’s new discounted rate for the five-year term also increased 6/10ths of a percentage point to 4.59 percent. TD discount mortgage rates now sit at 4.55 percent, while the discounted rate at Laurentian is holding steady at 4.54 percent. Continue reading
How Do Consumers Feel About the Market?
Economists and mortgage experts are always quick to analyze the Canadian housing market. However, these industry leaders often forget to ask for consumer opinions and insights. Luckily, there’s the CMHC Annual Mortgage Consumer Survey to help fill this gap.
Conducting in February and March of 2012, the CMHC Mortgage Consumer Report surveyed 3,502 recent mortgage consumers in order to better understand how market conditions are impacting the average buyer. Findings from the report are extremely useful, not just for first time home buyers and competitive mortgage rate seekers, but also for mortgage brokers and lenders. Here’s a look at some of the top statistics. Continue reading
Housing Prices Now and Then – Are Things Really That Bad?
If you believe the headlines, housing prices are on the rise across Canada even as consumer debt continues to pile up. The allure of low mortgage rates has thousands of home hunters bidding on what appear to be overpriced properties. But is that really the case?
When it comes to understanding the true price of a home, there’s one main factor to keep in mind – affordability. When the affordability of homes good, demand will usually exceed supply, leading to a hot housing market. So, just how affordable are homes in the current market? The answer from the Bank of Canada might surprise you. Continue reading
Retirement and Risky Real Estate
It’s hard to think about decreasing property values when listing prices are through the roof, but failure to understand and plan for the inevitable “bubble” burst could leave you high and dry, especially if you’re rounding the bend on retirement. According to Ben Rabidoux, a correspondent for the Globe and Mail, the next decade will likely be one of the most tumultuous in Canadian real estate history. Here’s what you should know. Continue reading