For the past 8 years or so, Canadian interest rates have been relatively low and stable. However, the market can fluctuate at any time, which is why it’s important to stay on top of the latest economic developments to see how they might affect Canadian mortgage rates. Here is some of the most recent data available about Canadian mortgage rates so you can prepare for what may be coming down the road.
Connection to the US Market
Right now, the Canadian economy is relatively sluggish and so economic forecasters don’t predict any drastic change to our rates in the near future. While our economic fate is closely linked with that of the United States, even if the US economy starts to strengthen the Canadian economy won’t necessarily do so as well, which means Canadian mortgage rates may not necessarily follow suit.
The Bank of Canada’s Overnight Rate
However, the chief economist at BMO Nesbitt Burns Douglas Porter has stated that the consensus doesn’t have the Bank of Canada raising interest rates until 2018.
The Bank of Canada’s overnight rate often dictates the prime rate trends for major banks. The prime rate is connected to your variable rate mortgage. Because no large rate increases are predicted from the Bank of Canada until 2018, you may have some stability in your variable rate for the next little while.
In the next six months, it is possible that fixed rates will increase slightly and variable rates will stay steady. According to Douglas Porter, the likelihood that these rates will drop is unlikely—that would require the US economy to falter or for there to be another drop in oil prices, which isn’t predicted in the near future.
The best way to effectively navigate your mortgage is to stay up-to-date on the latest economic trends. Find the best mortgage rates possible with the experienced and professional brokers at Team Levine. Contact us today to find out how our mortgage broker service can work for you.