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The Bank of Canada announced this morning another interest hike of .50%.

The Bank of Canada announced this morning another interest hike of .50%. Interest rates for variable mortgages and Home Equity Lines of Credit will rise by .50%.

What does this mean for variable rate mortgage holders?

 If your mortgage is with a lender that adjusts the payment when prime rate changes your payment will be increasing and you will be notified when prime rate changes.  

For every $100,000 mortgage your payment will increase by approximately $32/month by a prime increase of .50%

E.g. if your mortgage is $400,000 your payment will increase by $128/month.

 If your mortgage is with a lender that does not adjust the payment when prime rate changes your payment amount will remain the same, however the amount that goes towards principal and interest will be adjusted accordingly.  This would increase the amortization.  Your payment will only increase if rates go higher than the “trigger rate” on the documents you signed with your notary/lawyer.  The “trigger rate” is different for every mortgage so please refer to your mortgage documents. 

The major bank economists latest predictions indicate perhaps another .25% in Dec and again in January, and then in late 2023 early 2024 rates will drop to likely a new normal of prime around 4.5%. Assuming a Prime rate @ 4.50%, and your variable rate discount is 1%, your rate will be 3.50%. Consensus is that these higher rates are short term as the Canadian economy cannot sustain such high rates long-term.  It is likely we are facing another year and couple of months (until late 2023 or early 2024) before rates start to decline.   

Here is the history of prime.  https://www.mcap.com/Prime-Rate-History

Information provided by Sheryl Elsom  https://www.sherylelsommortgages.com

The next scheduled Bank of Canada rate announcement is Wednesday December 7, 2022.

Official Press Release HERE

Please do not hesitate to contact me should you have any questions or would like to discuss further.

 Thanks,

Aaron

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Open House. Open House on Saturday, October 8, 2022 1:00PM - 3:00PM

Please visit our Open House at 5080 ROSS RD in Abbotsford. See details here

Open House on Saturday, October 8, 2022 1:00PM - 3:00PM

They don't make them like this anymore! Beautiful 5 Acre usable fully fenced property in the desirable community of Bradner. Hand crafted 5,949 sq/ft home featuring 5 bed /3 baths w/master on main & plenty of room to add in the unfinished basement. Custom stained glass windows, Victorian custom mouldings throughout w/ beautiful tin ceilings. The craftsmanship is evident the second you walk in. Built to R-2000 standards w/ high efficiency heat exchange unit & insulation, wired for backup generator. Flat lot w/ city water /septic in the front of the property w/ lots of room for parking & equipment. Also on the property: Small barn w/loft 26'x20', Equipment Shed 30'x25', Workshop 23'x21', Plane Hanger 37"x24" and large barn w/ full loft 25'x52' ideal for horses. Open House Sat Oct. 8th 1-3pm.

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MARKET STATS SEPTEMBER 2022
MARKET STATS SEPTEMBER 2022
SURREY, BC — Continued slowing sales and a slight rise in inventory in September combined to bring greater stability to the Fraser Valley housing market....
 
 
 
If you ​have further questions please feel free to reach out directly to me, I am here to help.
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