Globe and Mail
There’s just one reason for the strength of Canada’s housing market – low, stable mortgage rates.
Rates are still low, but the stable part is in question after Royal Bank of Canada announced a small but still significant round of mortgage rate increases that will take effect Friday. Other banks will likely adjust rates as well, after a brief period of letting RBC draw fire as the first to move.
RBC will increase borrowing costs on special offers for fixed-rate mortgages with terms of two to five years by 0.1 of a percentage point. For example, the five-year fixed rate will rise to 3.04 per cent from 2.94 per cent, enough to increase monthly payments on a $400,000 mortgage amortized over 25 years to $1,901 a month from $1,881.