The Globe & Mail says “Canadians should be prepared for a modest hike in mortgage rates.” TD, however, just boosted their 5-year fixed rate a whopping 1/2%! That doesn’t happen too often.
Several more lenders announced fixed rate increases of their own–effective today or tomorrow. Others will likely follow.
Invis’s Gary Siegle says, “I expect we’ll start to see more of a shift to fixed (mortgages).” That’s probably a safe bet.
CIBC’s noted economist, Benjamin Tal, agrees. He feels now is a good time to lock in rates for the next five years, according to the Globe & Mail. Over at TD, Beata Caranci, director of economic forecasting, says consumers “definitely want to keep their eye on mortgage rates at this point in the cycle because we’re probably at the bottom.”
Of course, there’s no way of knowing how long fixed rates will remain higher, or if this is the first of many fixed rate increases. Regardless, with a handful of cheap lenders still out there, now might be an opportune time to get a rate hold.
Three lenders still offer under 5% on a 5-year fixed. We’re hearing at least one of these lenders will raise their rates tomorrow night and another requires a $500,000 minimum mortgage amount.
As for variable rates, TD economist Eric Lascelles says, “We don’t think the Bank of Canada is going to leap wholeheartedly into rate hikes immediately; we think they will be quite cautious on hold for the time being.” Let’s hope so.