Canadian Mortgage Rates Update: The lowest national fixed mortgage rates have increased by 20 to 35 basis points in recent weeks. If the Bank of Canada frightens the market into believing it will be more aggressive with rate rises, yields and fixed interest rates could increase further. A basis point is equal to one-hundredth of a percentage point.
The moment of truth will occur the following Wednesday at 10 a.m. ET. The central bank will release its next policy statement at that time. According to rates implied by the bond market, there is a one-in-three probability of a rate hike.
Currently, the lowest fixed-rate offers remain below 5%. From a market psychology perspective, this is not negligible. Some borrowers are unwilling or unable to clear the government’s mortgage stress test when mortgage rates exceed this threshold.
Canadian Mortgage Rates Update
Therefore, even this recent modest increase in mortgage rates may be sufficient to halt the home price recovery observed since January.
Meanwhile, all you-value consumers should not neglect local lenders and brokers. They have some of the most alluring bargains available. Here are a few examples for borrowers with default insurance who still favour five-year fixed rates:
- 4.34 per cent at Manitoba’s Affinity Credit Union
- 4.34 per cent at Saskatchewan’s Conexus Credit Union
- 4.39 per cent at ATB Financial in Alberta
- 4.49 per cent at Ontario’s Meridian Credit Union
- 4.49 per cent at British Columbia’s Vancity Credit Union
A few of these lenders also provide up to $4,000 in cash rebates; therefore, inquire about rebates where applicable. Please be aware that debtors who prepay their mortgage must typically repay a portion or all rebates.
Providers who advertise rates online and lend in at least nine Canadian provinces as of June 1, 2023. When purchasing a home with less than a 20% down payment, or when transferring an existing insured mortgage to a new lender, insured rates apply. Uninsured rates may include applicable lender rate premiums for refinances and purchases in excess of $1 million. For service providers whose rates vary by state, their highest rate is displayed.
