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Article: Greater Toronto housing market tightens as home sales surge 37% in January: board

Sales and activity in the market is really picking up, which is a little alarming as the bond market is re pricing this activity as this will delay the bank of Canada’s rate cut’s. 🥲
Article Source : Bloomberg

Rate Update: Bond yields plunge. What it means for fixed mortgage rates.

Great News The Yield on the 5 year Canada Bond has dropped considerably over the last few weeks. Bond yields, which lead fixed mortgage rates, fell to 2.84% on Friday, down from 3.15% on Thursday and well off the 3.59% high reached in mid-June. It came up a little today to 2.89%. So we should see fixed rates starting to fall, Normally lenders would have moved the rates down but they are being extra cautious given the higher inflation rates

The decline comes due to growing expectations of an economic downturn.

According to Rob Mclister -Other things equal, a 5-year yield that stays below 3% guarantees that big-bank uninsured 5-year fixed rates will land back in the 4s

Bond yields plunge. What it means for fixed mortgage rates - Mortgage Rates & Mortgage Broker News in Canada Bond yields dove over 30 basis points on Friday as economic worries start to replace inflation concerns.

What this means for your mortgage affordability or monthly payments ? This obviously would increase your mortgage payments, will that be offset by decrease in inflation rate ? Do let me know your thoughts on this. Reach out to discuss if you have any questions- 647–882-7388.

**Article: Bank of Canada Preview: Omicron Throws Rate Hike Forecasts into Question**

**Hold'the phone! I know so many people are looking to go fixed but it might be too soon to predict the anticipated rate hikes. It looks like the new Omicron variant could push back the Bank of Canada's plans to raise rates, Plus even when the BOC does raise the prime rates, remember rates do not stay high for 5 years. I still like variables over a fixed due to the flexibility from a VIRM with their preferred pre payment penalty calculation compared to a fixed.**

Reach out to me in case you have any questions and we can chat further.

**https://www.canadianmortgagetrends.com/2021/12/bank-of-canada-preview-omicron-throws-rate-hike-forecasts-into-question/ **

Bank of Canada Preview: Omicron Throws Rate Hike Forecasts into Question - Mortgage Rates & Mortgage Broker News in Canada While markets have moved up their Bank of Canada rate hike expectations to early 2022, some economists say the uncertainty of the new Omicron Covid-19 variant could put that into question.

If you find the current real estate market like this, you are not alone. Most of the homebuyers arefacing a crazy price war while buying their dream property. If you would like to know how much you can afford, so that you can bid with confidence, give me a call or message for a free consultation.

CMHC survey shows that there were more first time homebuyers then repeat buyers in 2021. This is one of your biggest investments, reach out to us and we can get you access to a big pool of lenders. We specialize in helping first time homebuyers get approved - you need choice in lenders and products.

** READ TILL THE END**
A really good article about mortgage rates and predictions for their future behaviour. For those who like quick bullets rather than a full article (who likes reading fiscal policies anyway) here is a summary and what it means for you as a home buyer:

* Inflation is hot at 3.7% for July
* Typically, when inflation goes crazy high, the central bank would increase rates to curb the high inflation rates. High rates —— you cannot borrow more money —— you spend less ——- demand goes down —— so do the commodity prices. Simple !! Right ???
* However, this inflation seems to be a temporary effect as the economy recovers from pandemic. Hence, it is unlikely that the central bank will take any immediate measures as a reaction to this.
* During the peak of pandemic, government bought high amounts of govt bonds injecting a lot of green cash in to the economy which has an impact on mortgage rates (kept them low). In the July meeting, they decided to reduce the bond buy back amounts, which will result in mortgage rate hikes eventually.
* Rates are expected go go up by 1-1.25% over the next 3 years.
* That makes your variable vs fixed mortgage dilemma a little less complicated? If not, give me a call and I am happy to help 😊.

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https://www.canadianmortgagetrends.com/2021/08/what-does-high-inflation-mean-for-mortgage-rates/?fbclid=IwAR2kOXNM8omDmzk09Vw0OMATZOGm8HZPm678rB6JY9HTNFshQ7GVbK52XBM

Who doesn't like free apps ? How about you try our very powerful "MOPOLO" mobile app to get access to free monthly credit score updates and much more ! Follow the link below and don't forget to put my name under "find a broker" tab:

https://www.mortgagealliance.com/en/NaveenChalotra/mopolo/

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