Calgary Mortgage Rates

Commercial banks often charge as much as 2% (200 basis points) or more than Preferred Lenders (Calgary Mortgage Brokers) for the same mortgage product. If you'd like more information on Calgary mortgage rates or to speak with a Calgary mortgage broker, give us a call at 703-2404 or contact us today.

Calgary Mortgage Information

Prime Rate is currently: 3.00%
Variable Rate: 2.65%

*Increase of allowable debt servicing ratios from 40% to 44% of income*

Calgary Mortgage Lenders

It's essential for buyer's who are considering purchasing Calgay property in to speak with a local lender who can advise on the currently available mortgage product(s) best suited for their individual situation. Two Calgary mortgage lenders I refer clients to are Allan Bowerman and Joyce Maclean:

Calgary Mortgage Forecast

Mortgage Growth to drop 50% Over Next 2 Years

April 28, 2013: RBC Capital Markets are predicting a growth slowdown of as much as 50% in Canadian mortgage growth rates over the next 2 years as home sales & prices cool nationally. Growth is predicted to fall from 5.4% to between 2 and 4% as markets in Toronto. Montreal, Ottawa & Vancouver slow. At the same time, mortgage loan losses will remain low as employment levels continue to be strong.

Canadian banks currently hold 65-70% of the $1.2 trillon residential mortgage market. 65% of residential mortgage debt in Canada is insured through the government's CMHC, as well as Genworth MI Canada Inc and Canada Guaranty Mortgage Insurance Co.

Reuters Poll: Bank of Canada to hold rates until late 2012

November 30, 2011: Results from a Reuters poll released today indicates economists & strategists believe the Bank of Canada will not increase interest rates until the 4th quarter of 2012.

The 4th quarter 2012 view was still much stronger than many primary dealers , who are calling for the next BofC move in 2013 *which is the projected time-frame for the U.S. Federal Reserve to raise rates*.

According to Dawn Dejardins, assistant chief economist at the Royal Bank of Canada, "Even though there is so much uncertainty in the global economy at the moment, Canada's economy still remains in relatively good stead".

The Reuters Poll was conducted Nov 25 - Nov 29, 2011

TD Predicts Calgary Real Estate to Rise

July 28, 2011: TD Economics predicts Calgary real estate will buck the national trend and see prices rise over next 2 year as the rest of Canada is threatened by a looming price correction. Calgary's market has bucked the national trend since 2007. Most major Canadian centres have eclipsed the peak prices hit in 2007, while Calgary prices have not.

"TD Economics has forecasted that the national average resale price will drop 10.2% over 2012 and 2013. But it looks like Calgary will escape this downward trend largely because it's already gone through much of its correction."

Read the full TD Economics forecast here

Changes to Canadian Mortgage Rules

Jan 17 2011: The government of Canada announced this week three loan financing changes designed to address concerns about increasing levels of household debt. 

First, the government will reduce the maximum mortgage amortization period from 35 to 30 years on CMHC insured (high ratio) mortgages. Second, the maximum amount of the value of a home that can be re-financed will drop from 90 per cent to 85 per cent. And finally, government insurance will no longer be available to financial institutions wishing to insure home equity lines of credit (HELOC's).

Together, these three measures are designed to ensure homebuyers invest responsibly in home ownership and don’t risk their financial security by buying too much home for their income or the country’s economic circumstance. It is important to note, the government did not increase the minimum down payment, which was under consideration. 

Carney Says Bank of Canada Will Be Careful on Rates With U.S. Slowing

Friday September 10, 2010

The Bank of Canada raised the benchmark interest rate by 25 basis points to one per cent this past Wednesday, a move most analysts expected. The rate hike was in response to what Mark Carney described as "exceptionally stimulative" financial conditions despite the slowing - but still growing - Canadian economy.

Careny told an economic conference in Calgary today that the central bank will be "careful" when considering additional interest rate increases, and would have to consider the implications of slower U.S. growth when making any decisions. “Renewed weakness in the United States could have important implications for the Canadian outlook,” said Carney. “The Bank will have to chart a careful course for Canadian monetary policy.”

Meanwhile, Paul Volker - former Federal Reserve Chairman and current Chairman of President Obama's Economic Advisory Board - told the same conference that it will be years before the U.S. economy fully recovers and global financial systems return to normal.

"The American economy, beginning now, it will take three years or so to get back to previous peaks. That has not been a normal business cycle behavior, normal recovery." He estimated it would take between 3 to 6 years to repair the global financial systems.

Canada raises key interest rate to 0.5%

OTTAWA (Reuters) June 01 2010 – Canada became the first of the G7 major industrialized countries to begin hiking interest rates following the global financial crisis, raising its key rate on Tuesday by a quarter-point to 0.50 percent.

The Bank of Canada gave no guarantee it would continue hiking its overnight target rate, which it had kept at an emergency low of 0.25 percent since April 2009, saying the European debt crisis and uneven global recovery clouded its confidence in a sustained recovery.

 “Given the considerable uncertainty surrounding the outlook, any further reduction of monetary stimulus would have to be weighed carefully against domestic and global economic developments," the central bank said in a statement.

After two quarters of robust economic growth in Canada, the bank said activity was broadly in line with its expectations, as was inflation.

The debt crisis in Greece and some other euro zone countries has so far had only a limited impact on Canada through lower commodity prices. But the bank said some countries will now be forced to tighten their budgets quickly and that, combined with debt reduction by banks and households, could slow the pace of global growth.

(Reporting by Louise Egan; Editing by David Ljunggren)    

CANADIANS NOT OVERLY CONCERNED WITH INTEREST RATES RISING: Investors Group Survey  

(April 29 2010) One-third of Canadian mortgage-holders are not concerned about their ability to make payments if interest rates rise, according to a recent survey by Investors Group, while four in ten respondents said it would take at least a three per cent rate hike before they began to worry.

"Canadians appear to have both feet on the ground through these ups and downs, but everyone needs to ensure their confidence is aligned with reality," said Peter Veselinovich, vice-president, banking and mortgage operations at Investors Group.

The sample's median outstanding mortgage balance was about $130,000. With a 25-year amortization, a three per cent rate increase would add over $200 to monthly payments on that balance, $70,000 over the course of the mortgage, the survey said.

Despite the survey's results, other homeowners are more than willing to part with their property. Nearly 100,000 new listings were posted last month, the busiest March on record according to the CREA. Over 230,000 listings have been added since the beginning of 2010, amounting to the most for any first quarter. However, the number of listings is still down nine per cent nationally from last year.   

3 Changes for Canadian Mortgage Industry take effect April 19 2010

(April 7 2010) As I am sure you may have heard, there were a few changes this week in respect to the rules regarding mortgage qualifying. The biggest change is the requirement that all borrowers be qualified at a five-year fixed mortgage rate even if they choose a shorter-term, lower-interest product.

The government also lowered the maximum amount Canadians can withdraw in refinancing their mortgages from 95 to 90 per cent. The government also introduced a minimum down payment of 20 per cent for government-backed mortgage insurance on non-owner occupied properties purchased "for speculation."

The reality is that these rule changes will affect less than 10% of the home buying market. CMHC insured rentals carried a very expensive premium surcharge and were not very popular and with the historically low interest rates, variable rate mortgage account for a small fraction of most lenders portfolio’s right now.

As you may have heard, there were a few more CMHC changes this week in respect to the mortgage qualifying:

• All borrowers choosing a fixed rate mortgage with a term of less than 5 Yr and any borrower choosing any variable rate mortgage product will have to qualify on a 5 Yr fixed mortgage rate
• The 5 Yr rate that the lenders must use in establishing affordability is the BANK of CANADA's 5 Yr standardized rate which currently sits at 5.49%
• The government has lowered the maximum amount Canadians can withdraw when refinancing their mortgages from 95 to 90 per cent.

We now also have been told that CMHC will only allow a 50% addback on rental property income and no longer allow the 80% direct offset that is currently allowed. This will affect clients who want to move to a new home and keep the current residence as a revenue property. The current CMHC "Self Employed Stated Income" program is now only eligible for clients whose self employed tenure is less than 3 years.

Please fill out our contact form, or call 403-703-2404 for assistance anytime you need to know more about Calgary mortgage rates or any property that interests you. When you're ready to take the next step toward purchasing a home, we're here to help.

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