Are you planning to invest in a commercial property, but don’t have enough funds? With the latest rate of 25 bps on 29 Jan, the current mortgage rate has come down to just 3%. If you want to apply for commercial loans in Surrey, this is the best time to apply as the hope for further cuts is very low and they’ll likely go up after this.
The BoC was confident in the current state of the economy and had a solid understanding of it. Inflation is currently firmly within the BoC’s goal range, the unemployment rate is close to a peak, and Canadian growth is modest but gradually improving with 200 basis points of easing already planned.
However, the BoC’s forecast isn’t beset by the usual, everyday uncertainties. This time, the tone of Governor Tiff Macklem’s message and the Monetary Policy Report was significantly different.
For the time being, fixed rates ought to stay the same due to recent activity in the bond market. Lenders have no compelling reason to raise their fixed rates after the yields on government bonds, which are used to calculate three and five year fixed rates. Your timing is ideal if you’re looking for a variable-rate mortgage within the next month or two because this reduction will result in variable rates falling by an equivalent amount.
Fixed mortgage rates are not expected to drop much in 2025. However, it can be challenging to forecast fixed rates in the long run.
Will rates on variable mortgages drop?
From June to December, the BoC gradually lowered the overnight rate, and it has little leeway before going above its “neutral rate.” The overnight rate is neither suppressing nor promoting economic activity within that range. Between 2.25% and 3.25% is the neutral rate. 3.00% is the overnight rate after the latest cut. This year, variable rates may decrease by an additional 100 basis points.
Current variable mortgage rates are usually determined by a lender using its prime rate. For this reason, when you visit the rates pages of banks, you will frequently discover that their variable mortgage rates are expressed as “prime minus X%.”
Right now, the prime rate is the same at all six of the Big Six banks. This is due to the fact that every bank bases its prime rate on the overnight lending rate set by the Bank of Canada. Prime fluctuates in tandem with changes in the overnight rate. However, it is important to note that TD is distinct from other Canadian banks in that it has its own prime mortgage rate, which is now 5.6%.
Apply Your Next Mortgage With Satbir Bhullar
Satbir Bhullar Mortgages is your trusted mortgage broker in Surrey, BC, assisting eligible borrowers in getting the best mortgage rates after the latest rate cut. Whether you are buying a residential or commercial property, we’ll search for the right mortgage options from our lender network and will help you seal the best deal. For more details about our mortgage services, feel free to give us a call.
Comments