Canadian Mortgage Rates Below 1%

While the pandemic has caused great devastation to the Canadian economy, for those lucky enough to have kept their jobs, they are able to take advantage of record low mortgage rates.

HSBC's variable rate for five-year, closed term mortgage, is the lowest in Canadian history at a rate just under 1% percent. The 0.99% percent rate is available for high-ratio mortgages, meaning a mortgage with a downpayment of less than 20% percent of the purchase price. This variable rate will change as HSBC’s prime rate fluctuates, meaning it could increase over the next few years based on a number of factors, including the Bank of Canada’s rates.

After being stuck at home for months because of COVID-19, many people want bigger homes with more space and home offices. In the Calgary market, well-priced homes are still selling and with mortgage financing being materially less expensive today than it was before the pandemic, people are clearly taking advantage of the low rates.

For the sixth month in a row, sales in the Calgary market recorded a year-over-year gain. Over the past few months, sales growth has been the strongest seen in the past five years. Throughout 2020, new listings have slowed, reducing inventory on the market by nearly 10% percent and are at the lowest levels since 2001. 

This has reduced the oversupply that has been impacting the market for nearly five years and finally pushed Calgary into a more balanced market. These tighter conditions have also contributed to some of the recent gains in the benchmark price for a home in Calgary, currently sitting at $423,600. This is nearly 2% percent higher than last year.

If you’ve been thinking about buying a home, or upsizing from your current home, there’s never been a better time to lock in a rate. Even the fixed rates offered by the major banks are the best they’ve ever been, with some in the 1.5% percent range. Most mortgage brokers can also lock in a rate for up to 120 days. So even if your plans don’t include a move until the Spring 2021, now is the time to secure the best rate possible.

Posted by Kirby Cox on


Email Send a link to post via Email

Leave A Comment

Please note that your email address is kept private upon posting.