“Clearly Canadians are either misinformed or they are trusting the advice of a banker that has the bank’s best interest at heart,” Omer Quenville, a Toronto-based broker said in the comments section of MortgageBrokerNews.ca.
CIBC conducted a Nielsen Consumer Insights survey of 1,005 Canadians between February 6-10. The survey found that 48 per cent of Canadians would choose a fixed rate mortgage if they had to make the decision today, compared to 31 per cent who would choose variable. 19 per cent were undecided.
"For those that have recently taken out a mortgage, and may have additional expenses or hold other debt, the predictability of a fixed mortgage rate may be more appealing," Gollom said. "However those who have paid off a sizeable portion of their mortgage are likely less sensitive to rate changes."
The survey also found that 47 per cent of Canadians believe rates will increase in the next 12 months, up from 38 per cent from last year.
"The poll also revealed that younger Canadians were even more likely to choose a fixed mortgage, with 56 per cent of Canadians aged 25-34 saying they would lock in to a fixed rate today, a number that has been steadily increasing over the last four years,” the release states. “In contrast, more established homeowners (aged 45-54) were among those less likely to lean towards a fixed rate (43 percent).”
Following a survey that found Canadians prefer fixed-rate mortgages over variable rates, one broker believes consumers may be “misinformed.”