Market update brought to you by Anna Labadze 604.782.3552 www.dreamrealestate.ca
It is hard to believe but we are now half way through 2010.
June saw the Bank of Canada increase their over night interest rates by 1/4% which resulted in the lenders increasing their prime lending rates by the same amount. Prime is now at 2.5%.
For those with variable rate mortgages or lines of credit it meant that your interest rates also went up by a ¼%. However with prime at 2.5% many people with discounted variable rate mortgage are still paying less than 2% on their mortgages.
Generally when the Bank of Canada increases interest rates it would mean that we would see several increases over the next few months which would have been in line with what many analysts had been predicting. We may still see these increases but it was interesting to note that in raising rates this time the Bank of Canada did say that it was not a given that rates would continue to go up and that a rate drop was possible depending on what was happening in the markets.
What has happened in the past month is that our inflation numbers did drop which puts less pressure on the Bank of Canada to continue to raise rates. In addition there are still several challenges facing the global economy, not the least of which is the impact that the BP oil spill in the gulf will have on the US economy.
In the past month fixed term mortgage interest rates have gone down with most lenders now around 4.39% for the five year fixed terms and for anyone needing a CMHC insured mortgage our exclusive lender, myNext, is currently offering their five year fixed term mortgage at 4.19%.
Overall it looks like rates will not be increasing by as much or as fast as was indicated earlier in the year.
If you have any questions about your mortgage please call: