The latest drop in fixed-rate prices could change things a little bit. Royal Bank recently decreased their fixed mortgage rates, and speculators are saying other financial houses may follow suit. However, that change, according to mortgage experts, is not going to be a major consideration among home buyers.
From the perspective of a mortgage broker and that of a home buyer, the real issue does not rely with interest rates, says Jason Scott, who is a mortgage broker at The Mortgage Group in Edmonton.
Instead, the issue relies with both the finance minister and the finance department's decision. It's about how hard they make it when an individual wants to obtain mortgages.
Remarkably, RBC lowered their fixed mortgage rates by 10 points during the weekend, bringing it to a close rate of 3.69%. Even though it's a small change, it has really gone against the general climbing trend in mortgage rates. Most home owners prefer the 5-year mortgage, which goes for about 3.5%. But there's a second option(though home owners don't prefer it) which goes for about 2.5%.
Mr. Scott says that no matter which direction the rates are moving, the reality is that the housing sector is currently riding on a low rates environment.
Sanjeev Desai, a real estate broker with Desai Realty in Toronto says that the government has already tightened regulations that govern individuals when seeking mortgages. But he adds that it could be a big surprise to see dramatic moves in interest rates.
He continues to say that the rates are fairly steady, though the natural forces of demand and supply are still influencing the market. Canadians are people who are a little bit conservative. They prefer a simple lifestyle. You won't find plenty of big cars and houses because that's not their way of life.
So while a bid to lower interest rates is still possible, now that lenders are competing for clients during this on-coming spring real estate season, the slight change of RBC's rate brings it at par with other lenders in the industry.
Right now, Scotia bank has a lower discount rate of 3.59% on fixed 5-year mortgage. Both CIBC and TD banks are standing at 3.79%, while the bank of Montreal is at 3.89%. Other lenders such as Dominion Lending Centres are offering there's at 3.25%. That's according to RateHub.ca.
Consequently, RBC said in an email that they had lowered their rates in order to stay at par with their competitor's pricing. They've been monitoring their competitors for several weeks now, and it's clear that their competitors have consistently been working on their rates to make them even more appealing to consumers. Any further changes could also result in price war, as was seen when BMO lowered their rates to 2.99%.
To make sure that consumers make wise decisions when obtaining mortgage products, Scott says that they would do better when they focused on the U.S economy and changes in bonds, rather than focusing on low rates. Ultimately, what's important is not the variation in the rates. Rather, it's about getting the right type of mortgage that suits a consumer's needs.
From the perspective of a mortgage broker and that of a home buyer, the real issue does not rely with interest rates, says Jason Scott, who is a mortgage broker at The Mortgage Group in Edmonton.
Instead, the issue relies with both the finance minister and the finance department's decision. It's about how hard they make it when an individual wants to obtain mortgages.
Remarkably, RBC lowered their fixed mortgage rates by 10 points during the weekend, bringing it to a close rate of 3.69%. Even though it's a small change, it has really gone against the general climbing trend in mortgage rates. Most home owners prefer the 5-year mortgage, which goes for about 3.5%. But there's a second option(though home owners don't prefer it) which goes for about 2.5%.
Mr. Scott says that no matter which direction the rates are moving, the reality is that the housing sector is currently riding on a low rates environment.
Sanjeev Desai, a real estate broker with Desai Realty in Toronto says that the government has already tightened regulations that govern individuals when seeking mortgages. But he adds that it could be a big surprise to see dramatic moves in interest rates.
He continues to say that the rates are fairly steady, though the natural forces of demand and supply are still influencing the market. Canadians are people who are a little bit conservative. They prefer a simple lifestyle. You won't find plenty of big cars and houses because that's not their way of life.
So while a bid to lower interest rates is still possible, now that lenders are competing for clients during this on-coming spring real estate season, the slight change of RBC's rate brings it at par with other lenders in the industry.
Right now, Scotia bank has a lower discount rate of 3.59% on fixed 5-year mortgage. Both CIBC and TD banks are standing at 3.79%, while the bank of Montreal is at 3.89%. Other lenders such as Dominion Lending Centres are offering there's at 3.25%. That's according to RateHub.ca.
Consequently, RBC said in an email that they had lowered their rates in order to stay at par with their competitor's pricing. They've been monitoring their competitors for several weeks now, and it's clear that their competitors have consistently been working on their rates to make them even more appealing to consumers. Any further changes could also result in price war, as was seen when BMO lowered their rates to 2.99%.
To make sure that consumers make wise decisions when obtaining mortgage products, Scott says that they would do better when they focused on the U.S economy and changes in bonds, rather than focusing on low rates. Ultimately, what's important is not the variation in the rates. Rather, it's about getting the right type of mortgage that suits a consumer's needs.