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Canadian mortgage rate forecast

Homebuyers are interested in the Canadian mortgage rate forecast as we move into the last quarter of 2021. Many are curious to see if the rates will remain the same, decrease further or start increasing soon. Mortgage rate forecasts allow Canadians to make intelligent decisions regarding their real estate investments. This article will highlight the critical aspects of the mortgage rate forecast.

Canadian Mortgage Rate Forecast

Will mortgage rates go down in 2021?

The number one question on most homebuyers’ minds right now is about mortgage rates. Although the rates mostly remained unchanged during the third quarter of 2021, some borrowers may be hoping for another drop before making their purchase decision. Based on the mortgage rates predictions Canada’s real estate market has been assigned, it’s unlikely that mortgage rates will reduce further. If anything, there are some indications that the interest rates may increase as we close out the year, although it depends on several factors.

Will mortgage rates go up in 2021? And if so, when?

While we’ve covered the possibility of an interest rate increase in 2021, the Bank of Canada has not altered its commitment to lower interest rates. Earlier this year (second quarter of 2021), the Bank of Canada had indicated that we could expect a rate increase by 2022. An updated Canadian mortgage rates forecast suggests that interest rates will remain steady throughout September but may trend upwards towards the end of the year, based on economic conditions.

Why are mortgage rates so low in Canada?

COVID-19 pandemic has had a significant impact on Canada’s economic health and growth. With so many individuals left in uncertain financial situations, banks in Canada opted to slash interest rates to help Canadians get back on their feet. As a result, interest rates across various sectors have been low. The Canadian mortgage rate forecast has indicated a similar trend in the real estate market over the past year. However, the low-interest rates are tied to Canada’s overall economic status. As we continue to fight against the pandemic and businesses return to pre-pandemic normal, we can expect banks to start reevaluating the interest rates.

Will it still be a seller’s market in 2022?

While interest rates are expected to remain steady in September, rising home prices show no signs of slowing down. Despite favourable mortgage rates encouraging homebuyers to make real estate investments, supply remains painfully low. While Canadian mortgage rate forecasts continue to look promising, real estate scarcity plays a significant role in driving up housing prices.

Is now a good time to lock in a mortgage rate?

It is a difficult question to answer because it depends on the individual case. Our general recommendation is to capitalize on the current record low interest rates. While considering the Canadian mortgage rate forecast is a good step towards making an informed decision, several other factors may affect the mortgage rates offered to you by lenders. Your down payment amount, credit history, mortgage type, and mortgage term length are some variables that affect your mortgage rate.

Should I get a fixed or variable mortgage rate in 2021?

Whether you should choose a fixed or variable rate mortgage is dependent on the continued lack of change in the Bank of Canada’s interest rate. If things continue as the general Canadian mortgage rate forecast expects, and interest rates remain at their current low until the end of September at least, then a variable-rate option may be better. However, if unpredictable elements force a rise in the interest rate, then the security of a fixed rate will work out better in the long run. Ultimately, the correct rate type depends on how risk-averse you are.

Who benefits the most from upcoming mortgage rates in 2021?

Based on our analysis, homeowners looking to refinance their mortgage are in the best position to benefit from the current mortgage market. With incredibly low financing rates yet equally dizzying home prices, those that have already purchased their homes at pre-pandemic rates will find that this is the perfect time to refinance and take advantage of the low interest rates. Those approaching the end of their mortgage term will also find a similarly positive outcome when starting another mortgage term with the current rates.

The Canadian mortgage rate forecast indicates that while we can expect to enjoy the overall low mortgage rates in the market for at least a bit longer, we’re poised to see some changes as the Canadian economy continues to recover. While it’s uncertain when rates will start to climb again, we may not see any further drops. Mortgage rates also continue to be offset by rising property prices. The market situation is well suited for refinancers or those on the cusp of a new term. Variable mortgages continue to be an appealing option for homebuyers with some risk appetite.

Look no further than Mortgage Maestro for the best possible rates and mortgage advice!