Put On Your Seat Belts – We’re In for a Mortgage Ride

As we head into the Victoria Day long weekend, Canada’s major banks have announced that they are lowering five-year rates on mortgages – for the second time this month – effective today.

Rates started out the month at 6.25% and have since dropped by 26 bases points, according to a Canadian Press report published Thursday by major media outlets.

In an interview with the Toronto Star, BMO Deputy Chief Economist Doug Porter says that the hold on interest rates has more to do with global financial instability than the Canadian economy. There’s a reluctance by the Bank of Canada to raise rates right now, despite domestic influences that would otherwise push them upward.

This could come as good news for Canadian homebuyers. Earlier this week, media reported that inventory of homes listed for sale was starting to catch up to demand and even exceed it in some markets – putting downward pressure on prices.

What does all of this mean? Well, if you’re in the market for a property, you might want to check out some real estate this weekend, and sharpen your pencil with a mortgage calculator to find out how much you'll save.
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