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Spring is in the air, and with it, a blossoming interest in the Canadian real estate market. This past month, we’ve observed an intriguing trend: numerous buyers are stepping forward, keen to secure homes before anticipated rate drops trigger a surge in property prices. No one can say with certainty, but many are predicting the first Bank of Canada rate cut could be as early as June or July this year.
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Real Estate Values
Ross:
We’ve seen several buyers come to the market this past month, eager to buy before rates start to drop. There’s cautious optimism that we may have seen the bottom for single-family homes and townhouses in the GTA, GVA, and other major markets. However, high-rise condos continue to show some vulnerability.
Interest Rate Outlook:
Bank of Canada Governor Tiff Macklem mentioned that rates are unlikely to go as low as during the COVID-19 era. The U.S. Federal Reserve is more cautious due to its higher rate of inflation. Roughly 40% of all Canadian mortgages will mature over the next two years, so the speed and depth of rate decreases are of major interest.
What’s Your “Best Rate”?
Rates vary tremendously from week to week and lender to lender. Recently, we’ve seen rates ranging from 5.09% to 5.29% for 3-year fixed mortgages and similar rates for 5-year terms. Variable rate mortgages start at 6.19%. Insured rates are lower and available for homes costing less than one million dollars.
The Takeaway
The Canadian real estate market is in a state of cautious optimism. Buyers are rushing to secure homes before potential rate cuts trigger price surges. Understanding these trends and how they affect mortgage rates is crucial for both buyers and homeowners. Keep an eye on the market and stay informed to make the best decisions for your real estate needs.
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Newsletter: “Spring Real Estate Trends & Mortgage Insights
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Ross Taylor
One of Toronto/GTA's Most Trusted and Knowledgable Mortgage Agents
Ross Taylor is recognized by his peers as one of Canada's pre-eminent difficult mortgage specialists. His ASKROSS blog and column in Canadian Mortgage Trends are focused on the intersection between mortgage financing and personal credit.
With unique dual certification as a licensed credit counselor and mortgage agent, Ross's insights are valued by mortgage professionals and homebuyers alike.
If you have questions about anything financial or mortgage-related, please contact [email protected]. Ross answers everyone personally.
For more information, visit About Ross Taylor.
