I had a big discussion not long ago with few of my friend regarding where real estate going and will happen to the mortgage rates. I said somehow I see that mortgage rate will go down due to drop of crud oil and rates have to follow that. Then last week when we got the new regarding The Bank of Canada cut its key overnight rate by one-quarter, next morning I called group of my friends that they were arguing with me and it was one of those moments that I love and they hate to hear…!!!! I told you so….
Then this morning follows this news:
“RBC cuts mortgage rate, price war coming?
It was always going to happen, but while last week the big lenders were reluctant to pass on the Bank of Canada’s interest rate cut to borrowers, this week there’s talk of a price war. Royal Bank of Canada is the first of the big banks to cut mortgage rates, dropping its five-year fixed rate deal to 2.84 per cent and also cutting its other fixed products. Flexible rates are unchanged though along with other lending from the bank. Of course, these rates are the bank's published deals and brokers frequently secure better ones, but a ‘battle of the rates’ creating headlines can only help the perception that now is a great time to buy. How low those rates go is anybody’s guess, but there are already predictions of sub-two per cent mortgages.”