RateSupermarket.ca’s Expert Mortgage Panel calls for a fixed rate increase as lenders face new funding challenges
August 9, 2013 – Toronto, Ontario: Look up… Way up! That’s the direction fixed mortgage rates will trend in August, according to RateSupermarket.ca’s expert mortgage panel. New limitations introduced by the CMHC to lender mortgage securities follow a month of investor unease as a result of U.S. bond buying speculation. Both factors are expected to have an elevating effect on fixed rates. However, variable mortgage rates will uphold the status quo, as little change in economic growth calls for sustained stimulus measures from the Bank of Canada until 2014.
Fixed Mortgage Rates: Up
Recent changes introduced by the CMHC limit the amount of guaranteed mortgage securities available to lenders, and it is anticipated that they will raise their fixed rate offerings by up to 0.5 per cent to cover increased mortgage funding costs. While fears regarding the U.S. bond buying program have somewhat diminished, government bond yields remain high as investors remain shy of interest sensitive investments.
Variable Mortgage Rates: Unchanged
The Bank of Canada did not raise the Overnight Lending Rate in the last announcement, and is not anticipated to in the next as economic growth factors remain below the two per cent benchmark for inflation.
This month’s panel members:
Ron Butler, Mortgage Broker, Verico Butler Mortgage
Dan Eisner, MBA. AMP. President, True North Mortgage
Dr. Ian Lee, Director of the MBA program at the Sprott School of Business and Chair of the MBA Committee
Kelvin Mangaroo, President, RateSupermarket.ca
Mary Zenar, Mortgage Broker, Zenar Financial
About RateSupermarket.ca ( www.ratesupermarket.ca )
Over 3 Million Canadians have found their best rate for personal finance products on RateSupermarket.ca. Launched in 2008, RateSupermarket.ca is Canada’s most comprehensive rate comparison site, offering visitors transparent access to the best mortgage rates as well as credit cards, bank accounts, insurance quotes and GIC rates.
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