Tag Archive: rate research


Foreigners Sway Canadian Mortgage Rates

Do you care if some investor in China or France dumps Canadian bonds? Many would answer, no. But when foreign demand for Canadian bonds drops, other things equal, bond prices drop. And given bonds and yields (interest rates) move inversely, and given fixed mortgages are partially funded in the bond market, when overseas demand for Canadian bonds falls, it usually...

HELOC Growth Isn’t What Everyone Thought

It turns out home equity lines of credit (HELOCs) aren’t growing as fast as previous government reports suggest. Prior regulatory filings showed HELOC balances increasingly at roughly double the pace of mortgages. Now, a new report from the Bank of Canada confirms the opposite. “The total balance of HELOCs contracted by 1% year-over-year…” in the fourth quarter of 2018, it...

Could a U.S.-China Trade Pact Send Mortgage Rates Higher?

You’ve probably seen the U.S. and China wrangling over trade in the news lately. Hanging in the balance is a major trade agreement—if they settle their differences (and they eventually will). Such an agreement would be historic. It would finally end their trade war while chipping away at America’s $419+ billion trade deficit (on goods) with China. A deal could...

Fixed and Variable Rates are Closest Since 2016

The gap between the best 5-year fixed rates and best variable rates is the smallest its been in two and a half years. We’re talking less than 1/8th of a percentage point between them. Depending on the equity a borrower has, folks can even find 5-year fixed rates that are below the best variable rates. What’s Provoking It One reason...

It’s Time to Rethink the Stress Test: CIBC

“You usually need to be in a recession to see household credit rising this slowly.”—Ben Tal, CIBC Here’s something everyone in the mortgage industry already knew, and CIBC just re-confirmed. The government’s mortgage stress tests have caused most of Canada’s lending slowdown since 2017. That’s the conclusion of CIBC Economics. As a result, the bank’s widely-respected econo-wizard Benjamin Tal concludes, “…Regulators should...

3-year Fixed Rates Are on Fire

Can anyone remember the last time 3-year fixed rates were the lowest widely available conventional mortgage rates? We can’t. But that’s now the case if you’re putting 20% down. For most well-qualified borrowers with 20-29.99% equity, we’d venture to say there’s no better deal right now than the three-year. Not a 1-year fixed, not a 2-year fixed, not even a...

Rate Nuggets: Yields Slow the Descent in Fixed Rates

Bond yields have found at least a near-term bottom after four-and-a-half months of declines. That means Canadian fixed mortgage rates may also have found a bottom…for now. Here’s a quick look at the lowest effective 5-year fixed rates, and how far they’ve fallen since the peak last fall: Insured: 2.79% -44 bps Insurable (80% LTV or less): 2.93% -40 bps Uninsured:...

Rates Slip Further

Canadian interest rates are still sliding. On Monday, Canada’s 5-year bond yield—which drives fixed mortgage rates—closed in the 1.50% range, something it hasn’t done since November 2017. Dozens of lenders have trimmed fixed rates in recent days as yields keep tumbling. And big banks are not excepted. With skidding home sales, weakening property values and mortgage growth near multi-decade lows, the...

Why Aren’t Rate Sites Showing You the Lowest Rates?

The number of Canadians who blindly trust mortgage rate comparison websites is staggering. This year, almost two million households will renew or take out a new mortgage. Of these, CMHC found that over 78% who research mortgages online compare interest rates. The majority of these folks, those who visit a rate comparison website, are simply not being shown the market’s best...

Perpetuating Online Mortgage Myths

Hopefully people don’t believe everything they read, especially when they read stories like this: “Instant mortgages are coming soon – what could go wrong?“ We’ve been meaning to comment on this piece of imaginative writing for a few months now, but real news got in the way. The article, originally published in October—from a respected journalist no less—is heavy on...