Interest rates for a mortgage in Ontario can vary greatly from one day to the next. There are numerous sites that can help you find the most current mortgage rates, but if you don’t want to spend all of your time in front of a computer, you can look at external market factors to judge for yourself which way the rates will go. Ontario is a real estate hotbed and because of the high volume of home sales in the province, it’s fairly easy to get a grasp of what the current mortgage rates are and maybe get an idea of where they are headed.
Current Mortgage Rates in Ontario
Mortgage rates are very low right now. The Canadian government maintains control of the mortgage rates rather than letting the market drive the numbers. The maximum amortization on a Canadian mortgage has been lowered from 30 years to 25 years, meaning home buyers can expect to spend five years less paying their mortgages. That also makes it even more important to find the lowest rates possible as a reduction in your rate will translate to thousands of dollars worth of savings over the life of the loan.
Fortunately, shorter loans have come with lower rates in past years. That means the reduction in amortization lengths should translate into lower rates for borrowers. Right now, 5-year variable loans are hovering in the low two-percents. Fixed-rate 5-year loans are generally in the mid to high two-percents.
Future Mortgage Rates
While nobody can say for certain what rates will do in the future, many economists predict the historically low rates will rise. As the global economy recovers, interest rates in other parts of the world will soar and rates in Ontario will rise as a reflection of what’s happening elsewhere. When rates rise, housing markets tend to slow down, so the period of growth in Ontario should slow down as well.
Today’s rates are higher than they were a year ago, but they are still incredibly low compared to the past. When looking at other global recessions, it’s easy to see that once the world economy picks back up, rates in Ontario will start looking more like they did before the markets crashed. Of course, it’s now harder to get a loan than it was in the past, so rates may not soar quite as high since there will be fewer borrowers competing for housing money.
If you’re interested in seeing what types of mortgage rates are available to you, click on the link below.