Posts from the ‘Monday Morning Mortgage Rate Updates’ Category

October 17, 2016

What Canada’s Fifth Round of Mortgage Rule Changes Mean For You – Part Three

In today’s post, Part Three, I’ll explain why I support the view that more changes were necessary and I’ll offer my take on the longer-term impacts that these specific changes will have on our borrowers, lenders, and housing markets. Then I’ll close by offering my opinion on whether our policy makers got these changes right.
October 11, 2016

What Canada’s Fifth Round of Mortgage Rule Changes Mean For You – Part Two

If the first mortgage rule change raised the qualifying bar for mortgage insurance, the second wave of rule changes completely eliminates mortgage insurance for certain categories of borrowers. To be clear, these changes don’t mean that affected borrowers won’t still have access to mortgages, but they do mean that these borrowers will have fewer options than before and should expect to pay rates that are higher than the lowest available.
October 3, 2016

How Would the Risk of Higher Mortgage Rates at Renewal Affect You?

Our regulators are right to be concerned about our record-high household debt levels, and more specifically, about the continued rise in Canadian mortgage debt outstanding. With mortgage rates at record lows, everyone can afford to borrow more, and when ultra-cheap borrowing costs are combined with housing markets where there is much more demand than supply, prices rise quickly. Over time, rising prices and rising mortgage debt levels feed each other in a self-reinforcing cycle, especially in places like Vancouver and Toronto, where demand has outpaced supply for some time. The longer this continues, the greater the risk that borrowers will not be able to afford their mortgages at renewal. To their credit, the majority of borrowers I work with are well aware of the risk that mortgage rates […]
September 12, 2016

Are You Buying the Hope That the Bank of Canada Is Selling?

The Bank of Canada (BoC) left its overnight rate unchanged last week, as was widely expected. Some market watchers had speculated that the Bank might actually cut its policy rate in response to the recent worsening in our economic data, but the BoC’s ongoing concerns about rising household imbalances make a near-term policy-rate drop unlikely in all but the most extreme circumstances (for the reasons I outlined in this recent post).