Economists at the major Canadian banks have built in rate increases for next year or later. The Bank of Canada wants to raise rates but must keep our rates in line with Europe and the USA. The Canadian dollar is still very strong and is at or close to par with the US.
The Globe and Mail reports that 5 Year Closed Mortgages with a 25 Year Amortization are averaging 4.098 %. While the rates have increased from a few months ago, they are still well below 2008 levels. Rates at the 5 major Canadian banks ranged from a low of 3.09 % to 5.24 %.
Higher interest rates in a stronger economy will reduce the amount that a Buyer can borrow and they will need a larger down payment and or a higher income to afford the same house. Higher interest rates in a weaker economy will slow the economy and would likely cause a Made in Canada recession similar to 1989.