Tag Archive: fixed or variable


Mortgage Rates Heading South Again

There’s an increasingly ominous vibe to Canada’s economic outlook, and that’s got the market taking rates down another notch. Canada’s 5-year bond yield is seven basis points lower today—to 1.63% as we write this. That’s the lowest it’s been since December 2017. All told, the 5-year yield has now sank 83 basis points since the November high. With the Bank of Canada...

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....

The Odd Spike in Insured Variable-Rate Mortgages

Something unusual has happened in the high-ratio mortgage world. Homebuyers with less than 20% equity are gravitating to floating-rates — more than ever in recent history. New data from the country’s top default insurer (CMHC) shows that almost a third of transactionally insured borrowers (31.3%) chose a variable- or adjustable-rate mortgage from July 1 to September 30. Jargon-Buster: “Transactionally insured” just...

Variable Rates Maintain Appeal, Despite Higher Rates

Despite higher rates, a healthy slice of our population is staying open minded to variable mortgage rates. A CIBC poll today finds that: 72% of Canadians expect rising interest rates over the next 12 months (26% think they’ll stay the same) An overwhelming 83% of Canadians favour “predictability and stability over risk” when it comes to their finances (unsurprisingly) 77%...

The Bank of Canada May Do You a Favour

The market is betting on rates heading higher this Wednesday. That’s bad news for mortgage shoppers. Or is it? One could argue that a rate hike on July 11 makes the fixed or variable rate decision even easier. Essentially the Bank of Canada is doing mortgage shoppers a favour. Here’s why… Closer to the Finish The higher rates go, the...

How a Trade War Could Hold Rates Down

“We cannot withstand a trade war with the United States” – Rona Ambrose. When over 70% of your exports go to one country, and that country’s representatives say, “There’s a special place in hell,” for your Prime Minister, that’s a problem. This is what the state of relations has come to between two of the world’s closest allies. Given Trump’s tendency to...

It’s Status Quo for Prime Rate

Here’s the latest on today’s Bank of Canada rate announcement: Rate Decision: No change in rates Prime Rate: Remains at 3.45% Market Rate Outlook: Two more hikes in 2018 BoC GDP Outlook: 2% growth in 2018 and 2019; 1.8% in 2020 BoC Statement: Click here The Money Quote: “…Developments since April further reinforce Governing Council’s view that higher interest rates will be warranted to keep...

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...

Canada’s Most Misconstrued Mortgage Study

If we only had a milli-bitcoin for every time someone said this: “…Long-term data tells us that a variable-rate mortgage is the best option.”—LowestRates.ca No, it doesn’t. What the “data” tell us is that a variable-rate mortgage was the best option in a specified timeframe based on particular assumptions. The data in no way mean that a variable-rate mortgage is the best...