Cory Kline, AMP
Mortgage Agent
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Residential Market Commentary: Fixed vs Variable Rates

Updated Wednesday, April 1, 2015  ::  Views (2377)

Ultra-low but, apparently, unstable interest rates have Canadians favouring fixed-rate mortgages over variable by a ratio of nearly 2-to-1.

A new survey, conducted by Nielson, for one of the country's big banks suggests 57% of homebuyers would pick a fixed-rate mortgage over variable, desiring certainty in their payments. That's up from 48% last year and 39% in 2011.

The numbers are fairly consistent across the country meaning Toronto and Vancouver are not having a major influence on the results.

The survey also indicates 44% of respondents expect to see interest rates rise in the next 12 moths while 42% expect no change. By comparison, the markets appear to have a stronger expectation rates will rise, calculating a 64% chance of an increase by the end of the year. That, however, is down from a 77% chance calculated immediately following the latest U.S. Fed announcement. The Fed is hinting that it is more prepared to look at rate increases.

Thank you First National for your insight.

Cory Kline, AMP
Neighbourhood Dominion Lending Centres - Barrie Office
 
Cell / Text: 705-794-1283
Fax: 1-877-812-6190
 
Mortgage Agent, FSCO # M09001239
Brokerage FSCO Lic. # 11764
 

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