Current Canadian Home Mortgage Rates…Weekly Overview

| Updated February 10th, 2012 |

This week there was good economic news from around the world.

Stock markets were up as the Greek government reached a tentative austerity deal that will avoid a bond default next month. In more good international news the UK central bank has promised to inject $79 billion of new money into the British economy and the US unemployment claims were lower than expected last week.

The good US employment report and progress on Greek debt restructuring talks this week has international investors thinking positive about the economy. That means they are more willing to take risks and less likely to park their money in safe assets like bonds. However, less money in bonds has led to some increase in bond yields.

The good employment news in the US has some investors wondering if the Federal Reserve will stick by its’ plan to keep interest rates low well into 2014. Most serious Fed watchers feel the Fed will err on the side of caution and keep rates low even as the US economy picks up to avoid causing a “double dip” recession before the US economy gathers momentum. The Fed will want to ensure the US economy has the strength to power through any international downturn too.

In Terms of Mortgage Rates:
We have the posted 5 year mortgage rate bumping back up to 5.24%. If other banks all follow along our reduction in the Benchmark Rate could be short lived although the difference is hardly enough to affect us when you look at the numbers.

These higher bond yields could also squeeze some of our super rate specials.

Clients who want the low rates don’t sit on the fence waiting for an even lower rate. This looks like a limited time offer that could end at any time!

| Updated January 27th, 2012 |

This week the the US Fed announced that they do not plan to increase interest rates until late 2014. They now want to give investors and economists confidence by letting them know explicitly that the Fed will not undermine economic recovery with an early rate hike.

Watch for a reduction in the Qualifying Benchmark rate next week to 5.14% from 5.29% today. It’s not a lot but a little can sometimes make a difference.

In Terms of Mortgage Rates:Fixed mortgage rates are still low and should remain at this level for the foreseable future. No too many consumers are choosing the variable rate as the difference between fixed and variable is marginal. Remember get mortgage pre-approved to avoid missing out on these all time historic low rates.

| Updated January 20th, 2012 |

This week the Bank of Canada met for the first time in 2012 and decided to keep its rates steady as expected. Most analysts agree that rates are likely not to increase for another year or so.

Low inflation numbers suggest that overall low mortgage rates are here for a while.

On the European front: Standard and Poors Rating Service downgraded the government debts of 9 European nations late last week. Canada’s debt still carries the top rating.

In Terms of Mortgage Rates: Expect fixed rates to stay low and no changes to the variable discount for some time. Good news for those with lines of credit and variable rate mortgages.

| Updated January 13th, 2012 |

In Europe the European Central Bank rate remained unchanged at 1% today. They have long since stopped talking about rate increases as the European economies continue to struggle with heavy debt loads.

While the Canadian housing market remains strong some bankers have expressed worries that certain segments of the market (condos in Vancouver and Toronto specifically) look like they are due for a correction in the next year. There have been similar predictions in the past that did not materialize so time will tell if these ones comes to pass. The negative news stories generated by those predictions may themselves cool enthusiasm for the markets in question.

The Bank of Canada will meet shortly to… well who knows what they really do but it will not involve a change to the Canadian Overnight Rate. So prime and short term lending rates will remain stable once again. In fact the BoC is not likely to change rates until some time in 2013, or beyond, unless something unexpected happens to the Canadian economy in the meantime.

While the US unemployment rate fell in December the Canadian rate edged up to 7.5%. That is still lower than the US rate of 8.5% but the US trend is improving while ours appears to have been slipping towards the end of 2011.

The good news is that 17,500 net new jobs were created in Canada in December which reverses a two month slide in job creation. But the bad news is full time jobs continued to decline and the increase was made up in part time work instead which is not as good for the economy as full time.

However the stronger trend in the US should help Canada in 2012 as a growing US economy tends to pull our Canadian economy along with it.

In Terms of Mortgage Rates:Low and stable bond yields have some lenders reducing mortgage rates on the 3-5 year terms. They are getting fairly attractive relative to the variables since the discounting from prime has virtually disappeared.

| Updated January 6th, 2012 |

Happy New Year!

Canadian unemployment statistics for December are out. Overall unemployment rate in Canada is 7.5% (up from 7.4% in November).

Unfortunately, we are starting 2012 the same way we ended 2011. There is still concern about financial market imbalances in Europe and the US.

As Such, the central bank is expected to keep the current highly accommodative monetary conditions unchanged well into this year.

In Terms of Mortgage Rates:Mostly stable rates over the holidays and into the new year. Historic low rates continue to be available for home buyers. Remember we can put a pre-approval in place so that it protects you against rising interest rates while you shop for a home and better yet if rates go down you will get the lower rate.

| Updated December 23rd, 2011 |

Higher food and gasoline prices kept Canada’s inflation rate at 2.9% in November, above the Bank of Canada’s comfort zone. However, the price of crude oil has been falling lately which should reduce gasoline prices in the New Year. The Bank of Canada is not going likely to increase interest rates in any event until the crisis in Europe settles down, and that will take time, so there is no upward pressure on interest rates for now.

The Teranet – National Bank Canadian Home Price Index was flat month over month in November compared to October, but is still up 7.9% over November last year. The Canadian housing market has surprised many with it’s strength as other real estate markets have fallen around the world.

The Canadian economy was flat in October posting zero GDP growth, slightly below expectations.

In Terms of Mortgage Rates:Mostly stable rates this past week. Likely to be the same next week as we loose two days to bank shut down.

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