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How Much Do Mortgages Cost in Canada?

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When it comes to residential mortgages in Canada, the current outlook for the consumer is relatively rosy. Largely in response to America’s slow economic recovery and continuing uncertainty in Europe, recent announcements from The Bank of Canada suggest that interest rates will remain at record lows for the foreseeable future. Mortgage rates, particularly short term and variable rates, are therefore expected to be kept at bay. As it stands, despite the global economic woes, the Canadian market remains fairly balanced. House prices continue to rise, buoyed by low interest rates, strong demand and low unemployment levels.

Foreign investment is bringing big bucks to the country, with investors tempted towards what they see as a safe haven with attractive assets and commodities. Those with the ready cash may now see investing in property as a wiser and more profitable move than buying bonds or playing the stock market.

Tourism and travel remains a burgeoning industry in Canada, with ever increasing numbers flocking to the Great White North on holiday. The past few years have seen a surge in the demand for holiday property in Canada, with people choosing to buy holiday properties for their own use or for investment purposes. Many foreign investors who choose to rent out their properties are finding it to be a lucrative avenue of real estate ownership. Luxury ski properties continue to be snapped up in the British Columbia resort of Whistler, with sales up by an impressive 24% in February versus January this year. The spring season has always traditionally been a busy time, with experts reporting that it is still very much a buyer’s market.

So, you’ve decided that now’s the time to put your money into bricks and mortar. You hear that there are some great deals out there, but where do you start? Competition for residential mortgages is fierce – private label mortgages are being introduced and foreign banks and mortgage companies are entering the market. The Internet is your best first port of call not least because there are some inspired one-stop-shops out there which do all the hard work for you, and, best of all, the service is free. Search for mortgage brokers with Ratesupermarket and you’ll be guaranteed access to multiple lenders offering the best mortgage deals on the market. You can pick up a one year fixed term mortgage with True North Mortgage and pay a rate of 3%, or if you can commit to five years, the rate drops to only 2.75%. Both of these offer cash back incentives. British Columbia residents looking for a three year fixed deal will pay 2.80% for the duration if they take out a mortgage with Coast Capital.

In terms of quality of life, Canada was rated one of the top countries in the world in a study published in 2011. And if you’re looking for a profitable investment, Canada, given its stability and development potential, could be an excellent choice.

This has been a guest post from Chad. I hope you enjoyed it!

Money

AUTHOR Derek

My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.

2 Comments

  1. The bank rate up here in Canada has been incredibly low for a very long time and it doesn’t look like it will change much this year.

    Right now mortgage rates are very attractive and we usually see a lot of homes for sale in March and April and they sell much quicker than they would any other time of the year.

    For example we have 2 neighbours that both had their homes listed last fall by the same Remax realtor. The homes didn’t move. One of the neighbours even had to move out because their new home was ready. Anyways their listings expired in January. In February they both listed with new realtors and just this past week (in March) they both sold. People just love to buy real estate in the Spring.

    • Springtime is an excellent time to sell a home, especially in the North! With low interest rates and a plethora of homes for sale, it is pretty enticing for buyers. I know my wife and I were looking to buy a house in the spring last year! 🙂 Thanks for the comment!


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