Cross town Condos . The central bank cut the interest rate of applying for mortgage eligibility again. Home loan experts and industry insiders expect the Bank of Canada to cut its benchmark interest rate on its five-year mortgage to 4.79% on Wednesday from the current 4.94%.Please Visit: Cross town Condos to Get Your VVIP Registration Today!
Because at present, the five-year mortgage rate of most of the country’s commercial banks has been reduced to 4.79%. The central bank generally sets the benchmark based on the most common interest rates of Canada’s six largest banks.
The benchmark interest rate is also equivalent to the qualifying rate for Canadians to apply for a mortgage, so the cut means that buyers are less eligible to apply, making it easier for Canadian families to get loans. it also gives more impetus to the already hot real estate market.
“this will make it easier to qualify, or allow some people to borrow more money to buy a house,” said Paul Taylor, president of the Canadian Association of Mortgage Professionals, who represents the lobby.
In 2016, the federal government launched mortgage stress tests to ensure that borrowers do not take on too much debt by borrowing money to buy a house, on the one hand, and to cool the housing market on the other. The new rules did work at the beginning, not only slowing the pace of borrowing by Canadians, but also causing house prices to fall in places such as Vancouver.
But now that borrowers have adapted to stress tests and mortgage rates have been historically low, the housing market has recovered and prices have begun to rise in Toronto and GTA as well as in the Greater Vancouver area after the worst of the epidemic in April and May.
GTA, for example, sold more than 11000 homes in July, up 29.5% from a year earlier, and a record high for the month. At the same time, the average selling price of all kinds of houses rose to $943710 in that month, with a net increase of more than 130000 a year and a year-on-year increase of 16.3%.
Last month, the average price of a detached house in GTA exceeded $1 million for the third month in a row, while the price of a detached house in Toronto exceeded $1.54 million, up 26% from a year earlier.
“if you are eligible for a mortgage, you may need the last Canadian dollar to increase your purchasing power,” said Rob McLister, a loan broker and founder of Ratespy.com, a Canadian interest rate comparison website.