(403) 226-3485 221 - 4615 112 Avenue SE, Calgary AB, T2C 5J3

 

the ZEN in balance
BLOG

Mortgage Rate Trends in 2016 // January 16, 2016

The Royal Bank of Canada recently raised rates on several of its products, the latest in a series of changes to the mortgage industry that could help cool the housing market this year.

As of early 2016, the bank increased rates on fixed mortgages of between two and five years by 10 basis points. RBC’s five-year variable rate consequently increased by 15 basis points increasing the rate to 3.04%.

Following suit was CIBC who then increased some of its mortgage rates on their three and four-year fixed rate products.

Although many would perceive this move as a negative, the reality is that it’s a positive move on behalf of the banks to protect the Canadian housing market.

Overall five-year fixed-rate mortgages — the most popular type in Canada — have risen by 0.2 percentage points in recent weeks. That’s a relatively small increase, which would amount to an extra $40 per month on a $400,000 mortgage, however, some experts see more hikes on the horizon.

The rate increases reflect discounted rate specials given only to customers who qualify and comes amid sweeping changes by federal regulators to curb soaring home prices in cities such as Calgary, Toronto and Vancouver.

This ensures that those seeking mortgages are indeed buyers that can comfortably manage their mortgage payments and not default.

For those clients who are already in a five-year fixed rate, you probably have a great rate already so there is nothing you need to worry about.

For clients who are in a variable rate right now and have the option to lock in at any time, now might be a good time to find out what rate you can lock into and make that change.

However, if you are in the housing market and would like to purchase your new home within the next six months, now’s a great time to not only get a bank pre-approval, but to also secure a rate hold. What this means is, that any mortgages that are pre-approved today qualify for today’s rates rather than next week’s rates.

There is still no better time to buy your dream house and get out of the rental pool. Remember that with mortgage rate increases comes rental hikes. New home prices have leveled off and with a pre-approval and a fixed bank rate you have the time to find the place you love with no concerns about paying more for it in the long-run.

For more information speak with your mortgage lender or alternatively, you can contact Avalon’s preferred mortgage advisor Troy Champ at 403-615-9414.

Posted in Interest Rates, Mortgage Rates | Tagged in | No Comment.

Why build with Avalon? We stand out from the crowd in a few important ways. LEARN MORE

ZEN FACEBOOK FEED

Landscaping is happening at ZEN Redstone! ... See MoreSee Less

21 hours ago  ·  

View on Facebook

ZEN URBAN DISTRICT TOWNHOMES COME WITH A SET OF WHEELS

Stay Mobile On A $2,000 Bike With Every Purchase

Saddle up and join Brookfield Residential's Tour de Seton June 23rd. Tour the area and you’ll realize how close you are to all the amenities you could wish for, and job opportunities, too!

And during the Tour de Seton, every ZEN Urban District townhome purchase includes a $2,000 bike from Mountain Equipment Co-op, one of the many new retailers moving into the area. (Don’t worry if you’re not big on cycling, you can choose something of equal value from MEC.)
... See MoreSee Less

1 day ago  ·  

View on Facebook

ZEN TWITTER FEED