The Bank of Canada’s rate announcement is tomorrow and many of the expert expect the Federal Bank to hold their target for the overnight rate steady at 0.25%. This means variable rates should, in theory, remain steady for the next little while. However, we’ve seen some variable rates come down to as low as Prime – 0.10% for a 4 year variable closed rate, with a 45 day quick close. This is the first variable rate offered below prime that we’ve seen for months and is great news for mortgage shoppers. Could this be a sign of confidence in an economic recovery from the banks? Or simply that inter bank lending is returning to normal and banks no longer need to hoarde cash.
| 5-year variable | |||
| Company | 10-Sep-09 | 03-Sep-09 | Difference |
| Best broker | 2.25% | 2.40% | -0.15% |
| BMO | 2.55% | 2.65% | -0.10% |
| CIBC | 2.65% | 2.65% | 0.00% |
| HSBC | 2.60% | 2.70% | -0.10% |
| ICICI | 3.50% | 3.50% | 0.00% |
| ING | 2.55% | 2.55% | 0.00% |
| RBC | 2.55% | 2.65% | -0.10% |
| Scotia | 2.45% | 2.65% | -0.20% |
| TD | 2.55% | 2.45% | 0.10% |
We’ve also seen fixed mortgage rates come down in the past week as shown below. This is mainly attributable to the fact that the Government of Canada 5 year bond price has increased over the past week by 2.80%, reducing the yield, and enabling banks to drop 5 year rates. After speaking to a few brokers in the last day or so, they believe rates will come off a bit more in the near future. Again, it’s difficult to time these things, and if you do need a mortgage soon, it’s probably best to look into it now and get pre-approved, rather than trying to time the absolute bottom of the market.
You can keep track of the latest mortgage rates here, or through our Ratewatch service, which will send you a quick update whenever the best mortgage rates on the site change.
| 5-year fixed rates | |||
| Company | 10-Sep-09 | 03-Sep-09 | Difference |
| Best broker | 3.79% | 3.79% | 0.00% |
| BMO | 5.49% | 5.85% | -0.36% |
| CIBC | 5.85% | 5.85% | 0.00% |
| HSBC | 5.79% | 5.79% | 0.00% |
| ICICI | 5.85% | 5.85% | 0.00% |
| ING | 4.19% | 4.19% | 0.00% |
| RBC | 5.49% | 5.79% | -0.30% |
| Scotia | 5.49% | 5.85% | -0.36% |
| TD | 5.55% | 5.85% | -0.30% |
We’ll look out for the Bank of Canada announcement tomorrow and post the results as soon as we get them.