In the last week, there were no changes to the mortgage qualifying rate of the Bank of Canada (BoC).
In the term of the fixed lowest mortgage rates, there was only one slight increase for the one-year term, where the fixed rate increased from 2.49 per cent to 2.64 per cent. But this change was just a minor adjustment and in general, the trend of low fixed mortgage rates still continues, keeping pace with the low selling prices of the five-year bond yields. As we mentioned before, the prediction for the next 30-45 is the same, so we probably will not see any major changes in the fixed mortgage rates.
The variable mortgage rates have not changed at all. That means that the BoC is still keeping record low interest rates, despite the possible impact of the mistrust in the indebted countries in the world. There are some rumours that we will see a substantial increase in the summer months, but right now, the rates are favorable. The BoC will meet on June 5th and it is improbable that there will be any corrections for the variable mortgage rates until then.
The problem for possible customers is that the mortgage rates can only rise because there is almost no possibility that they would drop lower than 2 per cent. The mortgage takers can expect only increase in their payments. Because nobody knows where the rates will go in the next five or ten years, it is possible that the price needed to pay the mortgage will substantially increase. Every client should be aware of that possibility and always consider the highly probable option that mortgage rates will increase again in the coming years.