Tag Archive: fixed mortgage rates


5-year Fixed Rates Back Under 3%

Canada’s spring mortgage market is officially underway. HSBC kicked it off today with a head-turning 2.99% 5-year fixed rate. It’s the first time since September 24, 2018, that Canadians have seen the best 5-year fixed rate start with a “2.” Much has changed in those five short months: Market expectations have gone from 100+ basis points of rate hikes in the next few...

Interest Rates on Thin Ice?

Have you ever walked on a frozen lake and worried you’re going to fall through? That’s the feeling of many traders right now — the ones shorting Canada’s 5-year government bond. The yield on that 5-year bond is what guides fixed mortgage rates (among other things), and it’s seemingly on the verge of making a new 14-month low. The magic...

A Major Bank Finally Drops 5-year Fixed Rates

At long last a Big 6 bank has cut its advertised 5-year fixed rate. RBC set the trend today in lowering its “special offer” 5-year fixed rate by 15 basis points, from 3.89% to 3.74%. (See: RBC mortgage rates) It only took a month and a half after five-year bond yields fell enough to warrant a rate cut. (Bond yields typically guide fixed-rate...

The Fixed-Variable Spread Shrinks Further

A regular consideration when choosing between a fixed or variable rate is the difference between them. As of late that “fixed-variable spread,” as we jargony industry people call it, has been slowly narrowing. So far, it has mostly been a result of diminishing variable-rate discounts. Just this morning, for example, TD hiked its advertised variable rate a head-turning 20 bps....

Mortgage Rates & Oligopoly Costs

Five-year Canadian yields are down 60 basis points in two months. Average 5-year fixed mortgage rates are down a measly 4 basis points.* Meanwhile south of the border, where they have this thing called mortgage competition, 5-year yields are down 54 bps and average 5-year fixed rates have fallen 16 bps so far. Average rates on the most popular U.S....

2018 – One Tough Mortgage Year

Few years have altered the mortgage landscape like 2018. Canada experienced what is arguably the biggest mortgage rule change of all time (OSFI’s B-20 and its “stress test”). It was a policy that hammered mortgage growth to almost three-decade lows, slashing buying power over 20% for uninsured mortgagors and forcing roughly 1 in 7 borrowers to change or abandon their mortgage...

A “New Era” for Mortgage Rates

“Last year marked the beginning of a new era for Canadian households,” said CIBC Economics on Thursday. “For the first time since the early 1990s, interest rates on five-year Government of Canada bonds were higher than they were five years before.” The bank adds, “With that trend set to continue, we estimate that 70% of households with five-year fixed rate mortgages...

Canada’s “Neutral Rate” in Perspective

The “neutral rate” has taken on a life of its own. The Bank of Canada is talking about it, analysts are talking about it, the media is talking about it and everyday mortgagors are talking about it. Millions of Canadians, us included, use it as reference when trying to estimate how high rates might go. But the neutral rate is...

New Mortgage Rate Insights From BMO

Rising rates and new mortgage regulations aren’t enough to scare nearly 1 in 4 Canadians. That’s how many plan to buy a home within the next year. This comes from a new BMO survey, which also found the national average price buyers expect to pay is about $474,000. That jumps to $580,000 in Toronto and $603,000 for Vancouver buyers. Most concerning...

TD Ramps Up Its 5-year Posted Rate

We’re seeing government bond yields approaching seven-year highs, and now this. TD has just boosted its posted 5-year fixed a whopping 45 basis points (bps) to 5.59%. Over the last decade, the average increase to posted 5-year fixed rates has been 24 bps. A 45-bps bump is rare, and the most in eight years. If at least two other Big 6 banks...