Canadian bond yields have fallen to their lowest level in six months. It's a grim little paradox that reflects bad news for the economy but cheaper borrowing costs for mortgage buyers.
Competing lenders are already passing on the fruits of diminishing returns. Among the conditions that became cheaper last week:
- Three-year uninsured fixed interest rates fell five basis points to 3.89 percent
- Five-year uninsured fixed interest rates fell 10 basis points to 3.99 percent
- Fixed interest rates for five-year insurance fell by five basis points to 3.79 percent
(Reminder: A basis point is one hundredth of a percentage point.)
Please note that these are nationwide tariffs. If you're particularly qualified or live in the right region, you can get even cheaper rates.
In Ontario, for example, Ratebuzz.ca advertises a 5-year loan term of 3.69 percent and a 3-year loan term of 3.64 percent, both for insured borrowers.
As for the interest rates advertised on the major banks' websites, they are just for show, like fake fruit on their boardroom tables. Bank representatives I chat with are willing to provide a discount of 25 to 50 basis points over the specified amount, depending on the term and qualifications of the borrower.
Of course, prices alone say nothing about the fine print, permit processing times, or the advice you will receive. So look around like your bank balance depends on it, because it does.
And there's some good news on the subject of interest rates, assuming you're already a homeowner. Stable borrowing costs, pent-up demand and additional income growth caused average home values ​​to rise last month – in most markets, anyway.
Additionally, early data from digital real estate brokerage Wahi suggests the trend could continue this month, at least in the Greater Toronto Area (GTA). So far, average prices in the GTA, which has long been the punchline of every real estate fix joke, were 2.7 percent higher in October than in September.
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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