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Greater Sudbury Real Estate Blog

Market updates, buying and selling guidance, Ontario real estate information and straight answers for people making real decisions in Greater Sudbury.

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Sept. 6, 2017

Bank of Canada Raises to 1.00%: September 6, 2017

Bank of Canada Raises to 1.00%: September 6, 2017

The Bank of Canada raises to 1.00% on September 6, 2017. The 25-basis-point increase moves the announced target from 0.75%. Stronger-than-expected activity supports another increase.

The decision at a glance

Policy measure Announcement
Overnight target 1.00%
Change +25 basis points
Bank Rate 1.25%
Deposit rate 0.75%

Stronger-than-expected activity supports another increase

The Bank raises the target again because activity is stronger and more self-sustaining than it expected in July. Consumption and employment remain robust, while business investment and exports show broader strength. Growth is still expected to slow in the second half, but from a higher level of output than previously forecast.

Inflation is below target but has edged higher as temporary price effects fade and economic slack diminishes. Wage and price pressure remains weaker than older relationships would suggest, and the labour market still has spare capacity. That makes the evolution of wages and productive capacity important to the next decision.

A stronger Canadian dollar and high household debt are also part of the risk assessment. The Bank explicitly says future moves are not predetermined and will watch how the economy responds to higher rates. Households should not assume either a fixed sequence of hikes or an immediate pause. Ask the lender how today's change affects payments, principal repayment and qualification under the particular mortgage contract.

What this means for a mortgage

The overnight target influences short-term borrowing costs, including lender prime rates. Variable mortgages and home-equity lines of credit are more directly exposed to prime-rate changes. Fixed mortgage offers also depend on bond yields, funding costs, the term and lender competition; they can move even when the Bank holds.

The Bank’s weekly lender series around this announcement provides the following posted reference rates. These are typical posted rates at six major chartered banks, not discounted offers or an assurance of the rate a borrower can obtain. They should not be read as proof that a lender has already passed through today’s decision.

Posted reference Rate
Prime 2.95%
One-year conventional mortgage 3.14%
Three-year conventional mortgage 3.39%
Five-year conventional mortgage 4.84%

Payment illustration: a $300,000 mortgage amortized over 25 years at the 4.84% posted five-year rate is approximately $1,718 per month for principal and interest, using Canadian semi-annual compounding. This is an illustration, not a lender quote. Taxes, insurance, utilities, closing costs and qualification requirements are separate.

Put the announcement into a Greater Sudbury plan

Buying or renewing

Ask for written figures using your balance, down payment and amortization. Compare payment mechanics, prepayment options, penalties and the cash left after closing. A variable mortgage with fixed payments may change how much principal you repay instead of changing the payment immediately; the contract determines the result.

Preparing to sell

Financing affects what buyers can carry, but it does not set one price for every home. Compare recent sales and active alternatives in the same neighbourhood and price range. Condition, carrying costs, presentation and offer terms remain central to the decision.

Official announcement: Bank of Canada, September 6, 2017. The national policy decision does not, by itself, establish a change in Greater Sudbury property values.

For a local plan, explore the Buyer Experience or Seller Experience. You can also browse the Bank of Canada Decisions & Mortgage Rate Context Archive.

Expect Moore for Your Real Estate.
— Chad Moore, REALTOR®
— Lake City Realty Ltd., Brokerage

Posted in Mortgage Rates & Home Financing
no comments yet
July 12, 2017

Bank of Canada Raises to 0.75%: July 12, 2017

Bank of Canada Raises to 0.75%: July 12, 2017

The Bank of Canada raises to 0.75% on July 12, 2017. The 25-basis-point increase moves the announced target from 0.50%. Broader growth allows the Bank to withdraw some support.

The decision at a glance

Policy measure Announcement
Overnight target 0.75%
Change +25 basis points
Bank Rate 1.00%
Deposit rate 0.50%

Broader growth allows the Bank to withdraw some support

The Bank raises the rate as Canada's expansion becomes more broad-based across regions and industries. Household spending has been strong, the oil-price adjustment is largely complete, and business investment and exports are expected to contribute more. The Bank forecasts 2.8% growth in 2017 and expects the economy to reach full capacity around year-end, earlier than in April.

Inflation remains below 2%, so the increase is forward-looking. The Bank judges much of the recent weakness temporary, including food-price competition, Ontario electricity rebates and changes in vehicle prices. It expects inflation to return near target by mid-2018 as those effects fade and unused capacity is absorbed.

This is a withdrawal of some support, not a published schedule of future increases. Further decisions depend on incoming data and financial vulnerabilities. Borrowers with prime-linked products should confirm how their lender applies the move. For a planned purchase, use the revised payment to test the home against the household budget before changing the offer ceiling.

What this means for a mortgage

The overnight target influences short-term borrowing costs, including lender prime rates. Variable mortgages and home-equity lines of credit are more directly exposed to prime-rate changes. Fixed mortgage offers also depend on bond yields, funding costs, the term and lender competition; they can move even when the Bank holds.

The Bank’s weekly lender series around this announcement provides the following posted reference rates. These are typical posted rates at six major chartered banks, not discounted offers or an assurance of the rate a borrower can obtain. They should not be read as proof that a lender has already passed through today’s decision.

Posted reference Rate
Prime 2.70%
One-year conventional mortgage 3.14%
Three-year conventional mortgage 3.39%
Five-year conventional mortgage 4.64%

Payment illustration: a $300,000 mortgage amortized over 25 years at the 4.64% posted five-year rate is approximately $1,684 per month for principal and interest, using Canadian semi-annual compounding. This is an illustration, not a lender quote. Taxes, insurance, utilities, closing costs and qualification requirements are separate.

Put the announcement into a Greater Sudbury plan

Buying or renewing

Ask for written figures using your balance, down payment and amortization. Compare payment mechanics, prepayment options, penalties and the cash left after closing. A variable mortgage with fixed payments may change how much principal you repay instead of changing the payment immediately; the contract determines the result.

Preparing to sell

Financing affects what buyers can carry, but it does not set one price for every home. Compare recent sales and active alternatives in the same neighbourhood and price range. Condition, carrying costs, presentation and offer terms remain central to the decision.

Official announcement: Bank of Canada, July 12, 2017. The national policy decision does not, by itself, establish a change in Greater Sudbury property values.

For a local plan, explore the Buyer Experience or Seller Experience. You can also browse the Bank of Canada Decisions & Mortgage Rate Context Archive.

Expect Moore for Your Real Estate.
— Chad Moore, REALTOR®
— Lake City Realty Ltd., Brokerage

Posted in Mortgage Rates & Home Financing
no comments yet
May 24, 2017

Bank of Canada Holds at 0.50%: May 24, 2017

Bank of Canada Holds at 0.50%: May 24, 2017

The Bank of Canada holds at 0.50% on May 24, 2017. The oil adjustment is largely complete, but wages and exports lag.

The decision at a glance

Policy measure Announcement
Overnight target 0.50%
Change No change
Bank Rate 0.75%
Deposit rate 0.25%

The oil adjustment is largely complete, but wages and exports lag

The Bank sees encouraging signs in business investment and increasingly broad household spending and housing activity. The economy's adjustment to lower oil prices is largely complete. An improving labour market supports demand across more regions, although the Bank expects growth to moderate after a very strong first quarter.

The restraint comes from inflation and exports. Intense retail competition is lowering food prices, core inflation remains below 2%, and wages are still subdued. Export growth is limited by competitiveness challenges. These details explain why stronger housing and consumer activity do not automatically trigger a higher policy rate today.

Housing-related policy measures have not yet substantially cooled markets, and the Bank remains alert to borrowing vulnerabilities. The hold preserves support while it looks for a more balanced expansion. For a household entering the market, borrowing capacity and sustainable ownership cost are still different numbers. Build a budget that can absorb maintenance or a less favourable renewal even if today's approval looks comfortable.

What this means for a mortgage

The overnight target influences short-term borrowing costs, including lender prime rates. Variable mortgages and home-equity lines of credit are more directly exposed to prime-rate changes. Fixed mortgage offers also depend on bond yields, funding costs, the term and lender competition; they can move even when the Bank holds.

The Bank’s weekly lender series around this announcement provides the following posted reference rates. These are typical posted rates at six major chartered banks, not discounted offers or an assurance of the rate a borrower can obtain. They should not be read as proof that a lender has already passed through today’s decision.

Posted reference Rate
Prime 2.70%
One-year conventional mortgage 3.14%
Three-year conventional mortgage 3.39%
Five-year conventional mortgage 4.64%

Payment illustration: a $300,000 mortgage amortized over 25 years at the 4.64% posted five-year rate is approximately $1,684 per month for principal and interest, using Canadian semi-annual compounding. This is an illustration, not a lender quote. Taxes, insurance, utilities, closing costs and qualification requirements are separate.

Put the announcement into a Greater Sudbury plan

Buying or renewing

Ask for written figures using your balance, down payment and amortization. Compare payment mechanics, prepayment options, penalties and the cash left after closing. A variable mortgage with fixed payments may change how much principal you repay instead of changing the payment immediately; the contract determines the result.

Preparing to sell

Financing affects what buyers can carry, but it does not set one price for every home. Compare recent sales and active alternatives in the same neighbourhood and price range. Condition, carrying costs, presentation and offer terms remain central to the decision.

Official announcement: Bank of Canada, May 24, 2017. The national policy decision does not, by itself, establish a change in Greater Sudbury property values.

For a local plan, explore the Buyer Experience or Seller Experience. You can also browse the Bank of Canada Decisions & Mortgage Rate Context Archive.

Expect Moore for Your Real Estate.
— Chad Moore, REALTOR®
— Lake City Realty Ltd., Brokerage

Posted in Mortgage Rates & Home Financing
no comments yet
April 12, 2017

Bank of Canada Holds at 0.50%: April 12, 2017

Bank of Canada Holds at 0.50%: April 12, 2017

The Bank of Canada holds at 0.50% on April 12, 2017. Stronger growth is encouraging, but the Bank wants durability.

The decision at a glance

Policy measure Announcement
Overnight target 0.50%
Change No change
Bank Rate 0.75%
Deposit rate 0.25%

Stronger growth is encouraging, but the Bank wants durability

The Bank raises its 2017 growth forecast to 2.5% and expects spare capacity to be absorbed in the first half of 2018. Recent spending on housing and by households is strong, while oil and gas activity has resumed. Some of that strength comes from temporary factors, including the Canada Child Benefit, so it is too early to call the recovery self-sustaining.

Exports remain uneven and business investment is weaker than the Bank would normally expect at this stage. Employment is strong, but hours worked and wages are less convincing. The Bank also reduces its estimate of potential growth because persistent underinvestment limits future productive capacity.

Headline CPI is at 2%, partly because of energy and carbon-pricing effects, while core measures have been drifting lower. The hold reflects this mixed picture: better growth has not yet produced broad, lasting inflation pressure. A Greater Sudbury buyer should welcome more stable financing conditions without assuming national housing strength describes every local price range or removes the need for careful conditions.

What this means for a mortgage

The overnight target influences short-term borrowing costs, including lender prime rates. Variable mortgages and home-equity lines of credit are more directly exposed to prime-rate changes. Fixed mortgage offers also depend on bond yields, funding costs, the term and lender competition; they can move even when the Bank holds.

The Bank’s weekly lender series around this announcement provides the following posted reference rates. These are typical posted rates at six major chartered banks, not discounted offers or an assurance of the rate a borrower can obtain. They should not be read as proof that a lender has already passed through today’s decision.

Posted reference Rate
Prime 2.70%
One-year conventional mortgage 3.14%
Three-year conventional mortgage 3.39%
Five-year conventional mortgage 4.64%

Payment illustration: a $300,000 mortgage amortized over 25 years at the 4.64% posted five-year rate is approximately $1,684 per month for principal and interest, using Canadian semi-annual compounding. This is an illustration, not a lender quote. Taxes, insurance, utilities, closing costs and qualification requirements are separate.

Put the announcement into a Greater Sudbury plan

Buying or renewing

Ask for written figures using your balance, down payment and amortization. Compare payment mechanics, prepayment options, penalties and the cash left after closing. A variable mortgage with fixed payments may change how much principal you repay instead of changing the payment immediately; the contract determines the result.

Preparing to sell

Financing affects what buyers can carry, but it does not set one price for every home. Compare recent sales and active alternatives in the same neighbourhood and price range. Condition, carrying costs, presentation and offer terms remain central to the decision.

Official announcement: Bank of Canada, April 12, 2017. The national policy decision does not, by itself, establish a change in Greater Sudbury property values.

For a local plan, explore the Buyer Experience or Seller Experience. You can also browse the Bank of Canada Decisions & Mortgage Rate Context Archive.

Expect Moore for Your Real Estate.
— Chad Moore, REALTOR®
— Lake City Realty Ltd., Brokerage

Posted in Mortgage Rates & Home Financing
no comments yet
March 1, 2017

Bank of Canada Holds at 0.50%: March 1, 2017

Bank of Canada Holds at 0.50%: March 1, 2017

The Bank of Canada holds at 0.50% on March 1, 2017. Inflation above 2% does not yet signal broad price pressure.

The decision at a glance

Policy measure Announcement
Overnight target 0.50%
Change No change
Bank Rate 0.75%
Deposit rate 0.25%

Inflation above 2% does not yet signal broad price pressure

January CPI is 2.1%, but higher energy prices and carbon-pricing measures in two provinces explain part of the increase. The Bank treats those effects as temporary. Its three core inflation measures still indicate substantial spare capacity, which is why the headline reading alone does not lead to an increase in rates.

Consumption and housing suggest that late-2016 growth was slightly stronger than forecast. The labour market is also adding jobs, yet wages and hours worked remain subdued. More people employed does not necessarily mean household purchasing power is accelerating at the same pace. Exporters continue to face competitiveness challenges.

The Bank keeps its January outlook and policy setting while monitoring major uncertainties. For households, the distinction between temporary inflation and persistent income growth is useful: plan from the income and costs you can verify, not from a single national indicator. There is no new policy-rate change to pass through to a variable mortgage today, while fixed offers remain free to move with funding markets.

What this means for a mortgage

The overnight target influences short-term borrowing costs, including lender prime rates. Variable mortgages and home-equity lines of credit are more directly exposed to prime-rate changes. Fixed mortgage offers also depend on bond yields, funding costs, the term and lender competition; they can move even when the Bank holds.

The Bank’s weekly lender series around this announcement provides the following posted reference rates. These are typical posted rates at six major chartered banks, not discounted offers or an assurance of the rate a borrower can obtain. They should not be read as proof that a lender has already passed through today’s decision.

Posted reference Rate
Prime 2.70%
One-year conventional mortgage 3.14%
Three-year conventional mortgage 3.39%
Five-year conventional mortgage 4.64%

Payment illustration: a $300,000 mortgage amortized over 25 years at the 4.64% posted five-year rate is approximately $1,684 per month for principal and interest, using Canadian semi-annual compounding. This is an illustration, not a lender quote. Taxes, insurance, utilities, closing costs and qualification requirements are separate.

Put the announcement into a Greater Sudbury plan

Buying or renewing

Ask for written figures using your balance, down payment and amortization. Compare payment mechanics, prepayment options, penalties and the cash left after closing. A variable mortgage with fixed payments may change how much principal you repay instead of changing the payment immediately; the contract determines the result.

Preparing to sell

Financing affects what buyers can carry, but it does not set one price for every home. Compare recent sales and active alternatives in the same neighbourhood and price range. Condition, carrying costs, presentation and offer terms remain central to the decision.

Official announcement: Bank of Canada, March 1, 2017. The national policy decision does not, by itself, establish a change in Greater Sudbury property values.

For a local plan, explore the Buyer Experience or Seller Experience. You can also browse the Bank of Canada Decisions & Mortgage Rate Context Archive.

Expect Moore for Your Real Estate.
— Chad Moore, REALTOR®
— Lake City Realty Ltd., Brokerage

Posted in Mortgage Rates & Home Financing
no comments yet
Jan. 18, 2017

Bank of Canada Holds at 0.50%: January 18, 2017

Bank of Canada Holds at 0.50%: January 18, 2017

The Bank of Canada holds at 0.50% on January 18, 2017. Canada's spare capacity sets it apart from the United States.

The decision at a glance

Policy measure Announcement
Overnight target 0.50%
Change No change
Bank Rate 0.75%
Deposit rate 0.25%

Canada's spare capacity sets it apart from the United States

The Bank projects 2.1% Canadian growth in both 2017 and 2018, with full capacity around mid-2018. Employment is improving, but labour-market indicators still show substantial room to grow. The resource-sector adjustment appears largely complete, although the loss of income and wealth continues to affect spending.

US policy uncertainty complicates the outlook. The Bank includes initial assumptions about prospective US tax changes, but the broader policy picture is unsettled. Higher global bond yields have already lifted Canadian yields, while currency strength creates additional challenges for Canadian exporters. Housing-finance changes and higher mortgage rates are expected to restrain residential investment.

Core inflation is below 2%, reflecting spare capacity. The Bank expects headline inflation to approach target as energy prices rise and food-price declines fade. Holding at 0.50% leaves support in place for an economy that is not in the same position as its US neighbour. For a Canadian mortgage borrower, neither US rate headlines nor an unchanged Bank target can substitute for checking the actual offer.

What this means for a mortgage

The overnight target influences short-term borrowing costs, including lender prime rates. Variable mortgages and home-equity lines of credit are more directly exposed to prime-rate changes. Fixed mortgage offers also depend on bond yields, funding costs, the term and lender competition; they can move even when the Bank holds.

The Bank’s weekly lender series around this announcement provides the following posted reference rates. These are typical posted rates at six major chartered banks, not discounted offers or an assurance of the rate a borrower can obtain. They should not be read as proof that a lender has already passed through today’s decision.

Posted reference Rate
Prime 2.70%
One-year conventional mortgage 3.14%
Three-year conventional mortgage 3.39%
Five-year conventional mortgage 4.64%

Payment illustration: a $300,000 mortgage amortized over 25 years at the 4.64% posted five-year rate is approximately $1,684 per month for principal and interest, using Canadian semi-annual compounding. This is an illustration, not a lender quote. Taxes, insurance, utilities, closing costs and qualification requirements are separate.

Put the announcement into a Greater Sudbury plan

Buying or renewing

Ask for written figures using your balance, down payment and amortization. Compare payment mechanics, prepayment options, penalties and the cash left after closing. A variable mortgage with fixed payments may change how much principal you repay instead of changing the payment immediately; the contract determines the result.

Preparing to sell

Financing affects what buyers can carry, but it does not set one price for every home. Compare recent sales and active alternatives in the same neighbourhood and price range. Condition, carrying costs, presentation and offer terms remain central to the decision.

Official announcement: Bank of Canada, January 18, 2017. The national policy decision does not, by itself, establish a change in Greater Sudbury property values.

For a local plan, explore the Buyer Experience or Seller Experience. You can also browse the Bank of Canada Decisions & Mortgage Rate Context Archive.

Expect Moore for Your Real Estate.
— Chad Moore, REALTOR®
— Lake City Realty Ltd., Brokerage

Posted in Mortgage Rates & Home Financing
no comments yet
Dec. 7, 2016

Bank of Canada Holds at 0.50%: December 7, 2016

Bank of Canada Holds at 0.50%: December 7, 2016

The Bank of Canada holds at 0.50% on December 7, 2016. Bond yields rise even though the policy rate does not.

The decision at a glance

Policy measure Announcement
Overnight target 0.50%
Change No change
Bank Rate 0.75%
Deposit rate 0.25%

Bond yields rise even though the policy rate does not

Global bond yields have risen rapidly following the US election, partly as markets anticipate fiscal expansion in an economy near full capacity. Canadian yields have moved higher too. This is an important distinction for mortgage borrowers: the Bank can leave its overnight target unchanged while longer-term funding costs and fixed mortgage offers change.

Canada's third-quarter rebound is strong, but the Bank expects more moderate growth in the fourth. Consumption benefits from the Canada Child Benefit; business investment and non-energy goods exports remain disappointing. Infrastructure spending is not yet visible in GDP, and substantial spare capacity remains despite employment gains.

Inflation is slightly below expectations, largely because of food prices. The upward effect of earlier currency depreciation is fading while economic slack persists. The Bank judges the current policy setting appropriate. For an upcoming renewal, compare the live lender offer and rate-hold expiry rather than use today's policy announcement as a proxy for the fixed rate you can secure.

What this means for a mortgage

The overnight target influences short-term borrowing costs, including lender prime rates. Variable mortgages and home-equity lines of credit are more directly exposed to prime-rate changes. Fixed mortgage offers also depend on bond yields, funding costs, the term and lender competition; they can move even when the Bank holds.

The Bank’s weekly lender series around this announcement provides the following posted reference rates. These are typical posted rates at six major chartered banks, not discounted offers or an assurance of the rate a borrower can obtain. They should not be read as proof that a lender has already passed through today’s decision.

Posted reference Rate
Prime 2.70%
One-year conventional mortgage 3.14%
Three-year conventional mortgage 3.39%
Five-year conventional mortgage 4.64%

Payment illustration: a $300,000 mortgage amortized over 25 years at the 4.64% posted five-year rate is approximately $1,684 per month for principal and interest, using Canadian semi-annual compounding. This is an illustration, not a lender quote. Taxes, insurance, utilities, closing costs and qualification requirements are separate.

Put the announcement into a Greater Sudbury plan

Buying or renewing

Ask for written figures using your balance, down payment and amortization. Compare payment mechanics, prepayment options, penalties and the cash left after closing. A variable mortgage with fixed payments may change how much principal you repay instead of changing the payment immediately; the contract determines the result.

Preparing to sell

Financing affects what buyers can carry, but it does not set one price for every home. Compare recent sales and active alternatives in the same neighbourhood and price range. Condition, carrying costs, presentation and offer terms remain central to the decision.

Official announcement: Bank of Canada, December 7, 2016. The national policy decision does not, by itself, establish a change in Greater Sudbury property values.

For a local plan, explore the Buyer Experience or Seller Experience. You can also browse the Bank of Canada Decisions & Mortgage Rate Context Archive.

Expect Moore for Your Real Estate.
— Chad Moore, REALTOR®
— Lake City Realty Ltd., Brokerage

Posted in Mortgage Rates & Home Financing
no comments yet
Oct. 19, 2016

Bank of Canada Holds at 0.50%: October 19, 2016

Bank of Canada Holds at 0.50%: October 19, 2016

The Bank of Canada holds at 0.50% on October 19, 2016. Housing measures and export weakness lower the growth path.

The decision at a glance

Policy measure Announcement
Overnight target 0.50%
Change No change
Bank Rate 0.75%
Deposit rate 0.25%

Housing measures and export weakness lower the growth path

The Bank cuts its growth forecast, not its policy rate. It now projects 1.1% growth in 2016 and about 2% in both 2017 and 2018. Exports have not recovered enough to make up for earlier losses, and slower housing resale activity is another restraint. The economy is not expected to reach full capacity until around mid-2018.

New federal housing-finance measures affect both sides of the decision. They are expected to moderate residential investment in the near term while reducing financial vulnerabilities over time. Meanwhile, resource investment appears to be bottoming out and non-resource services activity is growing, so the national picture is not uniformly weak.

Core inflation near 2% still masks unused capacity, while temporary weakness in gasoline, food and telecommunications prices lowers headline CPI. The Bank leaves the rate unchanged while assessing a more uncertain outlook. Buyers need to check their actual qualification and approval conditions under the applicable lending rules; a stable overnight rate does not mean the borrowing process is unchanged.

What this means for a mortgage

The overnight target influences short-term borrowing costs, including lender prime rates. Variable mortgages and home-equity lines of credit are more directly exposed to prime-rate changes. Fixed mortgage offers also depend on bond yields, funding costs, the term and lender competition; they can move even when the Bank holds.

The Bank’s weekly lender series around this announcement provides the following posted reference rates. These are typical posted rates at six major chartered banks, not discounted offers or an assurance of the rate a borrower can obtain. They should not be read as proof that a lender has already passed through today’s decision.

Posted reference Rate
Prime 2.70%
One-year conventional mortgage 3.14%
Three-year conventional mortgage 3.39%
Five-year conventional mortgage 4.64%

Payment illustration: a $300,000 mortgage amortized over 25 years at the 4.64% posted five-year rate is approximately $1,684 per month for principal and interest, using Canadian semi-annual compounding. This is an illustration, not a lender quote. Taxes, insurance, utilities, closing costs and qualification requirements are separate.

Put the announcement into a Greater Sudbury plan

Buying or renewing

Ask for written figures using your balance, down payment and amortization. Compare payment mechanics, prepayment options, penalties and the cash left after closing. A variable mortgage with fixed payments may change how much principal you repay instead of changing the payment immediately; the contract determines the result.

Preparing to sell

Financing affects what buyers can carry, but it does not set one price for every home. Compare recent sales and active alternatives in the same neighbourhood and price range. Condition, carrying costs, presentation and offer terms remain central to the decision.

Official announcement: Bank of Canada, October 19, 2016. The national policy decision does not, by itself, establish a change in Greater Sudbury property values.

For a local plan, explore the Buyer Experience or Seller Experience. You can also browse the Bank of Canada Decisions & Mortgage Rate Context Archive.

Expect Moore for Your Real Estate.
— Chad Moore, REALTOR®
— Lake City Realty Ltd., Brokerage

Posted in Mortgage Rates & Home Financing
no comments yet
Sept. 7, 2016

Bank of Canada Holds at 0.50%: September 7, 2016

Bank of Canada Holds at 0.50%: September 7, 2016

The Bank of Canada holds at 0.50% on September 7, 2016. Disappointing exports tilt inflation risk downward.

The decision at a glance

Policy measure Announcement
Overnight target 0.50%
Change No change
Bank Rate 0.75%
Deposit rate 0.25%

Disappointing exports tilt inflation risk downward

The second-quarter contraction is not just a wildfire story. Exports fell more broadly than expected, even after allowing for weaker US investment, resource-sector adjustment and auto-production cutbacks. July's export improvement is encouraging, but the earlier losses raise the possibility of a lower growth path than the Bank forecast in July.

A second-half rebound is still expected. Restored oil production, rebuilding in Alberta, Canada Child Benefit payments and federal infrastructure spending should support activity. The question is how much of that improvement becomes sustained private-sector investment and export demand rather than a temporary recovery from disruption.

Headline inflation is below 2%, with cheaper energy an important factor. Inflation risks have moved somewhat downward, but household borrowing vulnerabilities continue to rise. The Bank holds because the combined risks remain compatible with the current rate. For buyers, there is no new policy reduction to apply to a mortgage today; fixed offers and lender terms can nevertheless move independently.

What this means for a mortgage

The overnight target influences short-term borrowing costs, including lender prime rates. Variable mortgages and home-equity lines of credit are more directly exposed to prime-rate changes. Fixed mortgage offers also depend on bond yields, funding costs, the term and lender competition; they can move even when the Bank holds.

The Bank’s weekly lender series around this announcement provides the following posted reference rates. These are typical posted rates at six major chartered banks, not discounted offers or an assurance of the rate a borrower can obtain. They should not be read as proof that a lender has already passed through today’s decision.

Posted reference Rate
Prime 2.70%
One-year conventional mortgage 3.14%
Three-year conventional mortgage 3.39%
Five-year conventional mortgage 4.64%

Payment illustration: a $300,000 mortgage amortized over 25 years at the 4.64% posted five-year rate is approximately $1,684 per month for principal and interest, using Canadian semi-annual compounding. This is an illustration, not a lender quote. Taxes, insurance, utilities, closing costs and qualification requirements are separate.

Put the announcement into a Greater Sudbury plan

Buying or renewing

Ask for written figures using your balance, down payment and amortization. Compare payment mechanics, prepayment options, penalties and the cash left after closing. A variable mortgage with fixed payments may change how much principal you repay instead of changing the payment immediately; the contract determines the result.

Preparing to sell

Financing affects what buyers can carry, but it does not set one price for every home. Compare recent sales and active alternatives in the same neighbourhood and price range. Condition, carrying costs, presentation and offer terms remain central to the decision.

Official announcement: Bank of Canada, September 7, 2016. The national policy decision does not, by itself, establish a change in Greater Sudbury property values.

For a local plan, explore the Buyer Experience or Seller Experience. You can also browse the Bank of Canada Decisions & Mortgage Rate Context Archive.

Expect Moore for Your Real Estate.
— Chad Moore, REALTOR®
— Lake City Realty Ltd., Brokerage

Posted in Mortgage Rates & Home Financing
no comments yet
July 13, 2016

Bank of Canada Holds at 0.50%: July 13, 2016

Bank of Canada Holds at 0.50%: July 13, 2016

The Bank of Canada holds at 0.50% on July 13, 2016. A rebound follows the fires, while investment remains weak.

The decision at a glance

Policy measure Announcement
Overnight target 0.50%
Change No change
Bank Rate 0.75%
Deposit rate 0.25%

A rebound follows the fires, while investment remains weak

The Bank estimates an annualized 1% contraction in the second quarter after annualized growth of 2.4% in the first. Wildfires, uneven consumer spending and volatile trade contribute to that reversal. It expects an annualized 3.5% rebound in the third quarter as oil production resumes and Fort McMurray rebuilding begins, with household spending also supported by the Canada Child Benefit.

The annual picture is more subdued than that rebound suggests. Weaker business investment and exports reduce the growth forecast to 1.3% in 2016 and 2.2% in 2017. The Bank expects the economy to reach full capacity toward the end of 2017, later than in April. One strong rebound quarter would not erase the underlying weakness.

Brexit adds uncertainty, while financial vulnerabilities are elevated, particularly in Toronto and Vancouver. Inflation is expected to settle near 2% during 2017. The Bank holds because the overall risk balance still supports the current setting. In Greater Sudbury, the practical lesson is to separate a temporary bounce in national activity from lasting improvements in local demand and household income.

What this means for a mortgage

The overnight target influences short-term borrowing costs, including lender prime rates. Variable mortgages and home-equity lines of credit are more directly exposed to prime-rate changes. Fixed mortgage offers also depend on bond yields, funding costs, the term and lender competition; they can move even when the Bank holds.

The Bank’s weekly lender series around this announcement provides the following posted reference rates. These are typical posted rates at six major chartered banks, not discounted offers or an assurance of the rate a borrower can obtain. They should not be read as proof that a lender has already passed through today’s decision.

Posted reference Rate
Prime 2.70%
One-year conventional mortgage 3.14%
Three-year conventional mortgage 3.39%
Five-year conventional mortgage 4.74%

Payment illustration: a $300,000 mortgage amortized over 25 years at the 4.74% posted five-year rate is approximately $1,701 per month for principal and interest, using Canadian semi-annual compounding. This is an illustration, not a lender quote. Taxes, insurance, utilities, closing costs and qualification requirements are separate.

Put the announcement into a Greater Sudbury plan

Buying or renewing

Ask for written figures using your balance, down payment and amortization. Compare payment mechanics, prepayment options, penalties and the cash left after closing. A variable mortgage with fixed payments may change how much principal you repay instead of changing the payment immediately; the contract determines the result.

Preparing to sell

Financing affects what buyers can carry, but it does not set one price for every home. Compare recent sales and active alternatives in the same neighbourhood and price range. Condition, carrying costs, presentation and offer terms remain central to the decision.

Official announcement: Bank of Canada, July 13, 2016. The national policy decision does not, by itself, establish a change in Greater Sudbury property values.

For a local plan, explore the Buyer Experience or Seller Experience. You can also browse the Bank of Canada Decisions & Mortgage Rate Context Archive.

Expect Moore for Your Real Estate.
— Chad Moore, REALTOR®
— Lake City Realty Ltd., Brokerage

Posted in Mortgage Rates & Home Financing
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