Mortgages

The latest Canadian inflation numbers for February are in, and they were higher than expected—to say the least. Economists predicted inflation would land at 2.2%, up from January’s 1.9%, largely due to the expiration of a temporary federal tax holiday. But Statistics Canada reports that inflation surged to 2.6%, the highest level in eight months. So, what does this mean for mortgage rates moving forward? Will the Bank of Canada Hold or Cut Rates? It’s no secret that the Bank

Well, here we are again. The Bank of Canada (BoC) just delivered another 0.25% rate cut this morning, marking their seventh consecutive cut. This brings the prime rate down to 4.95%, once the banks and mortgage lenders follow suit—which typically happens within a few days. Just a few weeks ago, many were expecting the BoC to hold steady today, largely due to January’s higher-than-expected inflation numbers. But then came the tariffs, shaking things up and forcing the BoC’s ha

It’s almost impressive how Trump manages to create chaos where none previously existed. On Monday, March 3rd, he announced that a 25% tariff would, in fact, be slapped on Canada and Mexico, effective March 4th., stating that "there is no room left" for a deal. The stock market immediately panicked, with the Dow Jones Industrial Average nosediving more than 600 points and the Nasdaq shedding close to 500. Bond yields took a dramatic plunge, hitting their lowest point since Feb

Every time Donald Trump starts talking tariffs, the markets go on a rollercoaster ride. And for Canadians, that means one thing—bond yields drop, which puts downward pressure on fixed mortgage rates. Earlier this month, when Trump confirmed new tariffs on Canada and Mexico, Canadian bond yields took an immediate dive. Then, when he announced a 30-day pause, they rebounded—though only by about half the drop. Despite all this tariff turbulence, Canada’s big six banks have mostl

January’s inflation numbers are in, and they’re not exactly what the Bank of Canada (BoC) was hoping for. Headline inflation ticked up by 0.1% to 1.9%, according to Statistics Canada. While that might not seem like much, inflation would have been even higher if not for the federal GST holiday.  The biggest driver?  Energy prices, which surged 5.3% year-over-year, with gasoline alone jumping 8.6%. With rate cuts widely expected in 2024, many were hoping for a March cut. But th

With all the buzz about falling mortgage rates, the idea of rate increases feels like something out of an alternate universe. But here’s the truth: even when rates are trending downward, it’s never a straight shot. One week we may be talking about mortgage rates dropping and the next week could see them ticking upward.  This leads us to wonder: Where are fixed mortgage rates heading next?  Fixed Mortgage Rates: A Roller Coaster Without a Seatbelt  Trying to predict where fixe

If there’s one thing Donald Trump loves, it’s making headlines. Whether it’s a surprise announcement, a bold policy move, or a sudden change of heart, he knows how to keep the world on its toes. His latest act? Threatening a 25% tariff on goods imported from Canada and Mexico—and then signing them into action on February 1st. Naturally, the markets reacted faster than a cat spotting a cucumber. On February 3rd, the next business day, Government of Canada bond yields plunged b

As widely expected, the Bank of Canada has announced a 0.25% cut to its overnight rate in its first scheduled announcement of 2025. This marks the sixth consecutive cut, bringing the total reductions to 2.00% since the BoC began easing rates in June of last year. With this latest move, the prime rate is set to drop to 5.20%, and we can expect mortgage lenders to adjust their rates accordingly by the end of the week. While projections suggest that the Bank of Canada will conti

As we prepare for the Bank of Canada to continue with their rate cuts, mortgage lenders have now started reducing their variable rate discounts off prime rate. In other words, mortgage lenders are becoming less aggressive with their variable rate offerings, meaning those currently shopping for a variable rate mortgage would now be offered higher effective rates.  Why are Variable Rate Discounts Being Reduced?  Whether we're talking about fixed or variable rates , multiple fac

Since the Bank of Canada’s aggressive rate hikes in 2022, variable rate mortgages became as popular as flip flops in a snowstorm. Given that the prime rate had increased faster than anyone expected, the Bank of Canada included, very few could stomach the risk. Variable rate mortgages came with a significant rate premium, starting borrowers off at a disadvantage. The uncertainty was too much for most to handle driving the vast majority to fixed rates.  But times are changing. 

Happy New Year! It’s hard to believe we’re stepping into 2025 already. Time sure flies! 2024 was an exciting year for the mortgage market, as many Canadians eagerly awaited rate cuts from the Bank of Canada—and they got them. At the start of the year, forecasts ranged from a modest 1.00% cut to a more aggressive 1.75%. The most optimistic predictions turned out to be correct, with a total rate reduction of 1.75%. Kudos to National Bank for nailing that forecast! But now that

The Bank of Canada handed out an early holiday gift on December 11th with a much-anticipated 0.50% rate cut. If you have a variable-rate mortgage, you’re probably smiling as your rate just dipped. And if you’re in an adjustable-rate mortgage, your monthly payment joined the party.  But here’s the twist: on the very same day the Bank of Canada lowered rates, bond yields spiked upward, almost as if they didn’t get the memo. In fact, bond yields have been climbing nearly every d

As expected, the Bank of Canada announced that they are cutting their overnight rate by another 0.50% this morning. As the standard movement is 0.25%, anything greater is considered an oversized move.  Just weeks ago, it seemed like a smaller 0.25% cut was on the horizon. However, given higher unemployment data released on Friday, it gave the Bank of Canada the confidence to move forward with the double cut. Until then, it was a coin toss. How the Cut Affects Variable Rate M

The prospect of lower mortgage rates always brings excitement, especially as the Bank of Canada has already reduced its rate by 1.25% this year. With additional cuts projected into 2025, the landscape appears favorable—yet not without complexity. Interestingly, fixed mortgage rates have recently moved in the opposite direction, rising by roughly 0.30% over the past few weeks.  What does this divergence mean for borrowers over the next two years?  Let’s break it down.  Current

Many clients tell us they’re waiting for the next Bank of Canada rate announcement before locking in a fixed mortgage rate. However, it’s important to understand that fixed rates don’t move in tandem with the Bank of Canada’s rate. In fact, they can sometimes move in the opposite direction. For example, while the Bank of Canada announced a 0.50% rate cut on October 23 and is expected to cut rates again on December 11, fixed mortgage rates have been trending upward. So, what’

Since 2018, anyone applying for a mortgage in Canada has been required to pass a mortgage “stress test.” This test ensures borrowers qualify at a higher interest rate than the rate their payment was based on, acting as a safety net if rates increase. While some have criticized the stress test, I’ve always supported it—especially during the era of rock-bottom mortgage rates.   The biggest problem was if rates were to rise, then many would no longer be able to afford their mort

If you locked in your mortgage during the latter half of 2023 or the first half of 2024, there’s an exciting opportunity to potentially save thousands of dollars by switching to a lower rate mid-term. Many of my clients have saved between $5,000 and $10,000 by making the move—and in some cases, even more. Who is Eligible to Take Advantage of the Lower Rate Savings?  Even if lower rates are available, this doesn’t mean that savings are automatic when making the switch. There a

It seems like just about everyone was following the US election last night. As I mentioned in last week’s blog , a Trump victory would likely trigger an increase in bond yields—and that’s precisely what happened. Bond yields spiked immediately following the election results, setting the stage for higher fixed mortgage rates. We have already seen some increases in fixed mortgage rates over the past week. While we were seeing 3-year fixed rates as low as 3.99% in some situation

Since October 2023, fixed mortgage rates have dropped by about 2.00%, creating a buzz among homeowners and buyers. Now, with predictions that the Bank of Canada may lower its rate by up to 1.75% by Q3 of next year… including another potential oversized cut on December 11th, excitement is high.  However, it’s possible if not likely that fixed mortgage rates may not fall much further than they already have.  This doesn’t mean that they won’t come down. Just not quite as much as

The Bank of Canada has cut rates by 0.50%, a move that was widely anticipated. While there were some signals that they might take a more conservative approach, the drop in CPI inflation to 1.6% in September pushed the Bank to make this significant cut. The goal was to bring inflation down to 2%, which they expected to achieve by the latter half of 2025. However, inflation has not only hit the target but exceeded it—nearly a year ahead of schedule. With this rate cut now in ef