your mid-week mortgage market minute with Jim Cook, Broker
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in the mortgage marketplace ...
When looking at the future rate environment for Canada, we always need to take what is happening in the US into account. Canada's economy and currency is very much impacted by it.
Last weeks' Fed rate announcement left folks confident that rate hikes remain off the table for now and that it's policy rate is "likely at its peak". While that is positive and supportive of where we all want to see rates move, any coming rate cutting activity could be much more gradual than desired. The Feds don't see reaching their 2% core inflation target for two more years - and that it expects 2024 to be somewhat turbulent on the decline.
Also worth highlighting - the very conservative/cautious Swiss National Bank (central bank of Switzerland) reduced its policy rate from 1.75% to 1.5% and stated its fight against inflation the past two years has been effective. This is the first international rate cut and could mark the beginning of a global easing in interest rates.
Bottom line - everything still appears on track for reduced rates as we move forward over the next two years - likely more gradual than immediate. Meaning - same story I have written about for the past few months. Early summer is still likely first reduction in Prime Rate. Fixed rates remain largely static.
rate snapshot ...
No overall change in rates - yet. Unfortunately, the sweet spot 3 yr term rate hasn't budged. For properties priced below $1 million, with less than 20% down payment, example rates would be:
1 yr fixed 6.64% or $6.78 per $1k in mortgage
3 yr fixed 5.14% or $5.90 per $1k in mortgage
5 yr fixed 4.99% or $5.81 per $1k in mortgage
For clarity, a $500,000 at 5.09% on a 25 yr amortization would have payments of 500 x 5.87 = $2,935 monthly.
Note also that rates can change daily, certainly differ between lenders and definitely differ based on down payment, mortgage features and hidden costs.
in Jim's practice ...
As we reached out to advise all those in our portfolio who are cosignors about the new CRA reporting requirement, it resulted in 2 new transactions. Providing service and being proactive is always a positive return on time - usually not quite so readily obvious ;-)
Have a successful week!
Jim Cook's efforts made our new house purchase possible. He was beyond professional, and made our difficult deal work out. Got us a better rate than anywhere else. All while under a extreme time deadline. He ended up being the best option for a mortage in our time of need. He will also be our first choice in the future. I wish I knew to go to Jim for my first two house purchases. Thanks Jim!
(TD, Feb 2024)
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