your mid-week mortgage market minute
with Jim Cook, Broker
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in the mortgage marketplace ...
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After last week's Bank of Canada policy rate and quarterly commentary, things quieted down a fair bit these past several days as the discussion moves from how high rates might go to how long they will hold at the current level. It really was the first time that the BoC zeroed in on the impact of high shelter costs on inflation. It will be watching to see whether house prices start to bounce as we move into spring, among many other factors, before we should expect any changes in the Prime Rate. March 6th is the next scheduled BoC Policy Rate date.
This week we will have the US Fed's rate announcement, Cdn GDP and US Job numbers. The US inflation is now under 3% but US GDP is very strong. As long as US growth continues to exceed expectations, it could keep pressure on Canadian inflation which will delay any rate cuts on this side of the border.
There have been some lender changes recently. As many of you are aware, the broker channel doesn't have access to all mortgage products that a lender offers, nor does it have access to all lenders. ICICI Bank Canada, a subsidiary to India's second largest bank, left the broker channel this past week, intending to focus more on wealth management for the some two million Canadians who have come from India as well as those who continue to emigrate.
BMO announced it's return to the mortgage broker channel late last year and we are eagerly awaiting that to happen. It recognized that with almost 50% of consumers relying on mortgage brokers/agents in their mortgage decisions, it made sense to come back to the table. With BMO fully relaunched, brokers will have access to 3 of the top 4 banks in the country in addition to over a dozen monoline - non-branch-style lenders.
You can find last week's rate forecast chart/complete email here as well as the full BoC Monetary Report here.
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Rates are largely stable at the moment - with slight decrease in some terms since last week. For properties priced below $1 million, with less than 20% down payment, example rates would be:
- 1 yr fixed 7.50% or $7.32 per $1k in mortgage
- 3 yr fixed 5.14% or $5.90 per $1k in mortgage
- 5 yr fixed 5.19% or $5.92 per $1k in mortgage
For clarity, a $200,000 at 5.19% on a 25 yr amortization would have payments of 200 x 5.92 = $1,184 monthly.
Note also that rates can change daily, certainly differ between lenders and definitely differ based on down payment, mortgage features and hidden costs.
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I have had a few folks who are part of this pilot launch request a link to this email to share within their own newsletter or networks.
At the top of this email is a link should you wish to share this email within your network or include in a newsletter. I am working on some graphics that would help you do that more easily on social platforms.
This is now one of two emails issued from my office.
The second is a monthly, more entertainment-focused, client-facing newsletter. Jim VIP Club, which has contest giveaways every month - from $50 gift cards to major items like a 60" flat screen tv, a MacBook Pro, a treadmill or an Apple Watch, as examples. Subscription links to both are highlighted below.
Have a successful week!
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Words cannot explain my gratitude for Jim's guidance and patience through this complex endeavor, I can truly say that we wouldn't have been able to achieve this success without Jim. Jim is a true master of his craft and I will recommend him to anyone and everyone who is looking to embark on a similar journey as we just did. (JH, Jan 2024)
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