It’s been an eventful week for mortgage rate watchers.
Both the Bank of Canada and the United States Federal Reserve met, both flagged rising inflation risks, and both responded with a complete standstill on interest rates.
This gives variable rate holders more time or, if inflation hawks are to be believed, a delay in implementation.
The question is how long the director is willing to wait.
If oil prices stay above $100 a barrel for another month, as April inflation data shows, traders will begin to factor in rate hikes that are no longer theoretical, given forecasters’ fears and monthly inflation expectations.
This would result in almost half of borrowers who currently opt for variable interest rates being significantly less confident in their decision.
People continue to nibble on variables, especially for the initial 45 to 65 basis point Advantage. They remain happy and unfazed due to the growing risk of inflation and the amazing fixed rate offers that are still available.
Meanwhile, Ratebuzz is still charging 3.99 per cent for Ontario residents who prefer to purchase their plan with the bar closed. And this also applies to uninsured mortgages.
(How Ratebuzz enforces this rate – given current financing costs and the fact that it’s just a broker and not a lender – I really don’t know. But that’s someone else’s problem, not the borrower’s.)
On the default-insured side, British Columbia’s Coast Capital Savings yield is 3.89 percent for five years, and that’s good even for 30-year amortizations.
And if you’re looking for a three-year term, Ratebuzz tops the list at 3.94 percent (insured) and Manitoba’s Assiniboine Credit Union leads nationally advertised offers at 3.99 percent (uninsured).
Robert McLister is a mortgage strategist, interest rate analyst and editor of MortgageLogic.news. You can follow him on X at @RobMcLister.
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