Montreal Real Estate Blog » interest rates

Pre-approval: How it can benefit you as a home buyer

Deya Bautista — Mon, 09 Apr 2012 11:00:17 +0000

Updated from our First Time Buyer’s Archive. Originally posted on Jun13, 2007

Imagine falling in love with a home, making and offer only to find out later that you are not eligible for such amount?

Or another scenario: Competing with other buyers over your dream home, to find out the vendor accepted the other buyer’s offer JUST because they were already pre-approved.

It does happen. Often.

Understandingly, any vendor will favor a buyer who is prepared with a letter from the bank

Continue reading: Pre-approval: How it can benefit you as a home buyer

Posted By: Deya Bautista - Real Estate Broker working as part of the McGill Immobilier team. Specializing in high end condos in downtown and Old Montreal. For buying or selling contact Deya at: 514.917.7889 http://montrealrealestateblog.com/

Have Quebec Properties Become Unaffordable? Read This!

Deya Bautista — Thu, 29 Mar 2012 11:28:34 +0000

This is one of the most informative articles on quebec Housing economy published this year. The FCIQ released the latest Window on the Market newsletter, in the section “A word from the Economist”, this month’s issue discusses the price increase in Quebec’s market since the 1980′s until the present date (and then some forecasts).

Get the ultimate answer to the perennial question:

How affordable are properties today compared to previous decades?

Here are some snippets from the article, along with graphics to illustrate the market changes over the past 3 decades. I highly encourage you to read the original article, to save it and/or print it. It will make a great Market Reality Check. Knowledge rules.

“Many people believe that the dramatic increase in property prices in Québec in recent years has made residential real estate unaffordable for first-time buyers (the average price of single-family homes increased from $110,849 in 2000 to $247,054 in 2011, a 123 per cent increase).

However, household incomes have also increased over the years and historically-low borrowing costs have helped to significantly reduce the financial outlay required to purchase a property. Ultimately, how affordable are properties today compared to previous decades?

Calculating the mortgage carrying cost, meaning the proportion of income that must be allocated to the monthly mortgage payment in order to buy a property, will help us accurately answer this question.”

Source: FCIQ.ca

Mortgage Rates Going Up: five-year fixed goes to 5.54 %

Deya Bautista — Thu, 07 Jul 2011 11:38:27 +0000

An article by the Canadian Press:

Several of Canada’s big banks announced increases in their residential mortgage rates effective Tuesday.

Royal Bank (TSX:RY), TD Bank (TSX:TD) and Laurentian Bank (TSX:LB) all raised the posted rate for a five-year fixed-rate mortgage by 0.15 percentage points to 5.54 per cent.

Royal Bank raised its special offer rate for a five-year mortgage by 0.15 percentage points to 4.39 per cent, while TD and Laurentian raised their special offer rates for a five-year fixed-rate mortgage by 0.15 percentage points to 4.29 per cent.

Most other special and fixed rates at the banks were also going up between 0.10 and 0.15 percentage points.

Fixed rate mortgage rates are affected by the cost of borrowing in the bond market, where banks finance their home loan lending.

But, there is no reason to panic. If you’re looking for good rates, there are many options available for you. Here is a snapshot of today’s rates by RateDirect.ca – contact Danuta for more info

Bank of Canada Boosts Prime Rate at 3%

Deya Bautista — Mon, 13 Sep 2010 11:00:22 +0000

Bank of Canada governor Mark Carney raised the overnight lending rate a 0.25% point on Wednesday morning.

CTV News reports:
The decision marks the third straight month that the central bank has boosted the rate, which was set at a rock-bottom 0.25 per cent during the recession.

The overnight lending rate affects short-term borrowing, such as variable-rate mortgages and some lines of credit.

The steady rise over the last few months suggests the Bank of Canada sees Canada’s economy rebounding and no longer feels interest rates need to be at virtually zero in order to stimulate recovery.

Well, considering that back in January 2007 the prime rate was at 6%, we are not doing so bad right now.

Fixed Rates Officially Going Up, Variable Rates going down.

Deya Bautista — Thu, 04 Jun 2009 12:43:12 +0000

Great deals only last for a limited time. We all knew it was coming, we just didn’t know how soon…
Canada’s biggest banks are increasing key mortgage rates. Royal Bank of Canada announced the change on five-year, fixed-rate mortgages to 5.45%, an increase of 0.2%.

Bank of Montreal, Toronto-Dominion Bank, Bank of Nova Scotia and Canadian Imperial Bank of Commerce are following. The changes at RBC and BMO took effect on Tuesday this week, while new rates at TD, Scotiabank and CIBC were to be posted yesterday. ( I haven’t checked the news yet)

And those “special offers” from RBC, BMO and Scotiabank on five-year closed mortgages at 4.15% will also be subject to change without notice, reflecting a 0.2% increase.

On the other hand, variable rates are decreasing from Prime+0.80% to Prime+0.40%.
More info on variable rates on Canadian Mortgage Trends

Canadian Interest Rates Morning Recap

Deya Bautista — Thu, 24 Apr 2008 11:26:43 +0000

Interest rates drop half a point – The Star.com
“Bank of Canada governor Mark Carney has signalled the need for lower consumer borrowing costs and hinted further interest rate cuts may be required to shield Canada from a worse-than-expected slowdown in the United States. For the second time in eight weeks, the Bank of Canada slashed its policy-setting overnight interest rate by half a percentage point, to 3 per cent.”
Read the complete article

Big banks slow to react to Bank of Canada rate cut – The Vancouver sun.
“The Bank of Canada slashed its key interest rate a further half point, and hinted at more rate relief to come in an effort to keep Canada from being dragged into recession by a deeper and more protracted than expected downturn in the United States.”
Read the complete article

Canadian Mortgages Getting Cheaper, Variable Rates Gaining Popularity - CEP News
“With the Bank of Canada’s easing of interest rates over the last several months, including the most recent half-point reduction Tuesday, variable rate mortgages are gaining in popularity as Canadians try to take advantage of lower credit.”
Read the complete article

Get the Market updates delivered by RSS or Email. Subscribe now.

Interest rate cut will help Canadian home owners and buyers

Deya Bautista — Wed, 05 Mar 2008 22:58:24 +0000

The interest rate cut announced today by the Bank of Canada will help Canadian home owners and buyers, according to The Canadian Real Estate Association. The Bank of Canada cut its benchmark overnight lending rate by one-half of one percentage point to 3 1/2 per cent on March 4th, and signaled further cuts in the near future. The trend-setting Bank rate, which is set 0.25 percentage points above the overnight lending rate, now stands at 3.75 per cent.

“The threat of inflation is being eclipsed by concerns about slower economic growth, so the Bank of Canada cut its trend-setting bank rate to boost growth,” said CREA Chief Economist Gregory Klump. “Financial market turmoil will remain a downside risk to growth for some time. This means the Bank will probably continue lowering interest rates.”

Lower lending rates will help offset the effect of tightening credit conditions and allow homeowners to obtain better mortgage terms. This will also benefit Canadian homeowners dealing with variable rate mortgages

Continue reading: Interest rate cut will help Canadian home owners and buyers