Here’s the latest on mortgage rates following the maniacal once-or-twice-a-decade-type week we just had in the markets… Where Mortgage Rates Landed A quick look at this week’s major rate drops from the Big 6 banks: Prime Rate Banks slashed their prime rates on Thursday from 3.95% to 3.45%—the most since the credit crisis.That story. 5-Year Fixed Rates Typical big-bank unpublished...
One of the best short-term leading indicators of 5-year fixed mortgage rates is making a beeline towards a 2.5-year low. Canada’s 5-year swap rate is now just 1/10th of a percentage point away from this key threshold, which, if broken, will lead to further fixed-rate cuts. Banks routinely price fixed mortgages against swaps, which are interest rate derivatives used to...
Bond yields are plummeting globally as the coronavirus spreads to South Korea (833 cases), Italy (215 cases) and Japan (154 cases), among other countries. Media outlets are increasingly using the “P” word (pandemic), and the more they do, the more yields will drop. Even though we have just 9 cases so far, Canada is not an island in this crisis....
For years you’ve been able to apply for a big-bank mortgage on the internet. But you’ve never been able to complete the entire approval—including choosing a good rate—100% online. That changed in 2019. TD and Scotiabank became leaders by launching digital mortgage applications where consumers could process almost the entire mortgage online—by themselves—including choosing a discounted rate. And that rate...
TD has become the first Big 6 bank to lower its posted 5-year fixed rate since July 2019. The move comes amid plunging bond yields and just 11 days after the banking regulator (OSFI) essentiallyblamed banks for keeping posted rates too high. By doing so, banks haveinflated the federal mortgage qualifying rate, makingit unnecessarily difficult for borrowers to pass the...
The 2020s won’t be the decade to lock into a long-term fixed mortgage, not if you believe RBC Economics. It’s projecting just 1.7% annual economic growth for the next 10 years, give or take. That’s roughly a full point less than before the Great Recession. At 1.7% GDP, there’s generally very little reason for rate hikes. Quite the opposite, RBC...
motusbank and Tangerinehave been putting the screws to HELOC competitors for months now. Their respective 3.75% and 3.85% HELOC rateshave undercut almost every lender in Canada since last spring. That’sfar longer than other lenders ever expected (or hoped). The more that consumers learn about these rates, the more it becomes an issue for the major banks. Reason being,HELOCs are usually...
Compared to the chilling regulatory news of 2018 (i.e., the launch of OSFI’s mortgage stress test), this was a year of turnarounds in the mortgage market. For one thing, the year ended with palpable optimism in the housing sector. It was a degree of bullish sentiment that many didn’t think we’d see when 2019 began. Below we recap that and...
6.2%. That’s how much Canada’s average home price could rise in 2020, according to CREA. The national average home price is already up 8.4% in the last 12 months. A country-wide average doesn’t tell the whole story, of course. The Prairies and Newfoundland are seeing much softer markets. And,economists’ 2020 consensus price growth estimate is just 3%. But given we’re...
Rates are breaking out. Canada’s widely watched 5-year bond yield just hit a seven-month high. That’s typically bullish for fixed mortgage rates. Trendsetter RBC wasted no time this morning. It ran a press release announcing it was boosting 3-, 4- and 5-year fixed rates by 10, 20 and 20 bps, respectively. RBC doesn’t usually issue press releases when it’s merely...
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