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Fixed Rates On The Rise?? Advice for those in Ontario (GTA) and Manitoba (Winnipeg)
November 24, 2024 | Posted by: Cecile Morell
Why Fixed Mortgage Rates in Canada May Rise Next Week: Advice for Homebuyers in Ontario (GTA) and Manitoba (Winnipeg)
Are you shopping for a mortgage in Ontario's Greater Toronto Area (GTA) or Manitoba's Winnipeg market? If so, you’ve likely heard that fixed mortgage rates might increase soon. This expectation stems from climbing bond yields, which are a key factor in determining fixed rates. Here’s why this is happening and what you can do to secure the best mortgage rate for your home purchase or renewal.
Why Fixed Rates Are Set to Rise
Fixed mortgage rates are directly influenced by government bond yields, especially the 5-year Government of Canada bond. When these yields rise, lenders face higher borrowing costs, which they pass on to borrowers in the form of higher fixed mortgage rates.
Here’s what’s driving the surge:
- Global Economic Trends:
- Strong economic performance in the U.S., including higher-than-expected job growth and robust consumer spending, is pushing U.S. Treasury yields higher. Since Canadian bond yields tend to mirror U.S. trends, they’re climbing too.
- Stubborn Inflation in Canada:
- Core inflation remains higher than expected, signaling that long-term borrowing costs will likely rise. This makes lenders adjust fixed rates to align with economic conditions.
- Market Uncertainty Around Policy Rates:
- While the Bank of Canada has kept its key interest rate steady, bond markets are reacting to lingering inflation risks, causing bond yields—and consequently fixed mortgage rates—to rise.
What GTA and Winnipeg Buyers Should Do
Whether you're buying a home in the bustling GTA market or the vibrant neighborhoods of Winnipeg, timing is everything when it comes to securing a mortgage. Here's how to stay ahead:
- Lock in Your Rate Today: Many lenders allow you to hold today’s rates for up to 120 days, protecting you from increases while you finalize your home search or mortgage renewal.
- Work with a Local Mortgage Broker: A broker familiar with Ontario’s and Manitoba’s unique housing markets can help you compare rates and lenders to find the best fit for your financial goals.
Why Acting Now Is Key for GTA and Winnipeg Homebuyers
If you’re buying a home in a competitive market like the GTA or a rapidly growing one like Winnipeg, locking in a rate now could save you thousands over the life of your mortgage. Rising bond yields mean lenders are likely to increase fixed rates as early as next week, so don’t wait.
In the GTA? Contact a local mortgage expert who understands the complexities of Ontario's housing market.
In Winnipeg? Work with a Manitoba-based broker who can navigate the unique challenges of buying in Winnipeg.
The Bottom Line
With fixed mortgage rates on the rise, homebuyers in Ontario’s GTA and Manitoba’s Winnipeg should act now to secure the best possible terms. Whether you're a first-time buyer or renewing an existing mortgage, a mortgage broker can provide tailored advice to help you make informed decisions.
???? Ready to lock in your rate? Contact me today and take control of your homeownership journey before rates increase!
