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Mortgage Rates 2019

Although there is more than one feature to consider when choosing the right mortgage, the interest rate is certainly the focal point. At Homefund, we always publish the lowest rates available. Through our vast network of lenders, we can deliver to you quickly any special promotions that are available and make recommendations that will save you thousands of dollars on your mortgage.

“You come to us for the rate, you’ll be back for the service!”™

Date updated: April 24, 2019

Term Posted Bank Rates Homefund Best Rates
6 months 3.34% 3.30%
1 year 3.59% 3.29%
2 year 3.74% 3.19%
3 year 3.89% 2.96%
4 year 3.94% 3.14%
5 year 5.34% 2.94% – 3.14%
5 year Variable Rate 3.30% 2.85% – 2.95%
6 year 5.64% 3.97%
7 year 5.80% 3.49%
10 year 6.10% 3.34 – 3.44%
Secured Line of Credit Prime + 1.00% Prime + 0.50%

Rates are subject to change at any time without notice. Contact our office for other mortgage products. Rates based on Prime Residential. No Fees For Qualified Applicants.

Historical Rates in Canada

The chart below has tabulated the conventional mortgage 1 and 5 year posted fixed rates since 2005, along with the Bank of Canada overnight lending rate. If you are interested to see what these rates were prior to 2005, Bank of Canada has records dating back to 1980 and 1973 respectively, and as early as 1935 for the Prime Lending Rate. The rates charted below are Bank Posted Rates, but actual approved rates are typically discounted (please refer to our rate table above). A study conducted on behalf of CAAMP for a period ranging from 2006-2010 estimates that the average discount on a 5 year mortgage was 1.40% below the Bank Posted 5 year fixed rate.

Percentage of Mortgages by Type,
For New Purchase Mortgages and Recent Renewals
Mortgage Type Purchase
During 2018
Renewal or
Refinance During
2018
All Mortgages
Fixed Rate 68% 67% 68%
Variable or Adjustable Rate 30% 25% 27%
Combination 2% 8% 5%
All Types 100% 100% 100%
Source: Mortgage Professionals Canada survey, fall 2018

Fixed vs Variable Rate Mortgages

One of the more important decisions that borrowers are usually faced with right from the start is choosing a fixed rate or variable rate mortgage term.  This involves making a prediction of where future rates will be – not an easy task to say the least.  Many smart and well respected economists have been providing such forecasts and predictions, and over the last 20 years I’ve been in the mortgage industry, I can’t tell you how often they were off the mark.  So, how can a first time buyer, or even repeat buyer, decide with confidence.  Since we can’t predict with accuracy, we should at least examine and remove as much risk as possible.   We can use past and present mortgage rate trends and conditions to perhaps provide some guidance for future tendencies, but more importantly, we believe that your particular risk tolerances should be examined as a litmus test to choosing the type and term of mortgage.

Our national association, Mortgage Professionals Canada, has it’s chief economist Will Dunning conduct the research and prepare monthly, semi-annual and annual reports on the state of the residential mortgage market in Canada. These reports are based largely on consumer surveys, alongside the look at the economic and housing market environments in which consumers are making their choices.

As is shown in the table below, the study found that 68% of mortgage holders (4.12 million out of 6.03 million) have fixed-rate mortgages, 27% (about 1.61 million) have variable-rate or adjustable rate mortgages, and 5% (about 300,000) have “combination” mortgages, in which part of the payment is based on a fixed rate and part is based on a variable rate.

As is shown in the first column of the table, among mortgages for homes that were purchased during 2018, fixed-rate mortgages were chosen by 68%. For mortgages that have been renewed during 2018, the fixed-rate share is similar, at 67%. During 2018, the spread between fixed-rate mortgages and variable-rate mortgages (both on 5-year terms) averaged about 0.55 of a percentage point. This spread can be seen as the cost of “insurance” that the monthly mortgage cost will be unchanged for five years. Based on a typical mortgage for a recent buyer (about $300,000) the cost of this “insurance” averaged about $85 per month during 2018. At present (early January), a typical “special offer” interest rate is 3.75% for 5-year fixed-rate mortgages versus 3.05% for variable rates, for a spread of 0.70 points, and the cost of the insurance has increased to $110 per month. Most borrowers choose to accept the additional cost that is associated with fixed rate mortgages. Others are taking the chance that over the 5-year term of the mortgage interest rate increases will be minor and they will be better off with the variable rate.

Rates are subject to change at any time without notice. Contact our office for other mortgage products. Rates based on Prime Residential. No Fees For Qualified Applicants.