Will there be a rate fluctuation in the next 30-45 days? It depends who you ask, with RateSupermarket.ca’s panel of experts did not reach a consensus this month.
“The reduction in bond yields and mortgage rates resulted from a softening of confidence about economic prospects. At this point, that weakening of confidence may have gone a bit too far (the U.S. economy is likely to continue it gradual improvement),” CAAMP
’s chief economist, Will Dunning said as part of RateSupermarket.ca’s panel. “Therefore, it is possible that the recent drops in rates for five-year fixed rate mortgages may also have gone a bit too far.”
Dunning, along with True North president Dan Eisner
and Dr. Ian Lee believe fixed rates will remain unchanged.
“As stated in previous Monthly Outlooks, the steady tightening of the mortgage underwriting rules has incrementally reduced demand for mortgage financing,” Dr. Ian Lee, program director at Carleton University said. “Moreover, the five-year bank of Canada bond yield is hovering around 1.4 per cent to 1.5 per cent, suggesting stability in the fixed rates for the near future.”
However, RateSupermarket’s own president, Kelvin Mangaroo and leading mortgage broker, Ron Butler
, both believe fixed rates will drop in the next few weeks.
“Five-year bond yields have fallen to the lowest yet this year (below the 1.50 per cent range), and point to a downward trend among the lowest five-year fixed mortgage rates - we could see them falling below 2.79 per cent over the coming weeks,” Butler of Verico
Butler Mortgage said.
For his part, Butler was also the one voice of dissent regarding fixed rates; while his fellow panel members unanimously forecasted stable variable rates, Butler believes they too will drop.
“Regarding the Prime rate, the Bank of Canada remains eternally unchanged on the overnight bank rate,” Butler said. “However, capital seems plentiful to the point where we may see five-year variable rates discounted to Prime - 0.75% all over the place over the next few weeks.”