{"id":627,"date":"2019-07-29T02:32:37","date_gmt":"2019-07-29T02:32:37","guid":{"rendered":"https:\/\/www.realestateleads.ca\/blog\/?p=627"},"modified":"2023-09-27T00:03:51","modified_gmt":"2023-09-27T00:03:51","slug":"decline-in-5-year-fixed-mortgage-rate-a-big-plus-for-prospective-buyers","status":"publish","type":"post","link":"https:\/\/www.realestateleads.ca\/blog\/decline-in-5-year-fixed-mortgage-rate-a-big-plus-for-prospective-buyers\/","title":{"rendered":"Decline in 5-Year Fixed Mortgage Rate a Big Plus for Prospective Buyers"},"content":{"rendered":"
<\/div>

\"\"<\/a>As a realtor, one of the things you\u2019ll encounter often is people who are adamant that variable-rate mortgages are always preferable when financing a home. There\u2019s a lot to be said for them, no doubt, and it\u2019s one of the many things a client may ask their realtor long before they talk to a mortgage broker for the first time. As we keep harping at here, an informed and knowledgeable realtor is one who tends to be well regarded \u2013 and referred<\/em> \u2013 by his or her clients.<\/p>\n

Which leads us to also say again that there\u2019s so much to be said for making a strong first impression when meeting with would-be clients. Here at Real Estate Leads<\/a>, our online real estate lead generation system is a proven-effective way of not only creating more of these opportunities, but creating more genuine<\/em> ones \u2013 meaning with people who are genuinely<\/em> considering buying or selling homes in the near future.<\/p>\n

So, in the interest of building on your knowledge base, let\u2019s discuss the ramifications of this reduced 5-year fixed mortgage rate in greater detail.<\/p>\n

Dipping to 5.19%<\/strong><\/h3>\n

There it is – the interest rate used for mortgage qualification has fallen to 5.19% from its previous spot at 5.34%. it\u2019s especially noteworthy because it marks the first decline since September 2016. Back then the benchmark qualifying rate fell to 4.64% from 4.74%. It\u2019s been rising ever since, and that\u2019s based on the same reflection of what the BoC (Bank of Canada) sees as the economic outlook of the country.<\/p>\n

This past week\u2019s drop has much to do with global central banks deciding to loosen lending policies, but we should keep in mind that Canada\u2019s five-year bond yield – which impacts five-year fixed mortgages – has been going down from January 1st<\/sup> onwards.<\/p>\n

More Purchasing Power<\/strong><\/h3>\n

The consensus seems to be that the interest rate decline will allow a homebuyer earning $50,000 a year to afford a home that\u2019s some $4,000 more expensive than would have previously been the case. For someone earning $100,000 a year, they can be looking at something $8,300 or so more expensive.<\/p>\n

How this will be beneficial for homebuyers – and investors – doesn\u2019t need much explanation. In tandem with the Bank of Canada\u2019s decision to hold the interest rate two weeks ago, we\u2019re currently seeing the most auspicious period for prospective buyers in 19 months. Further, economists believe we\u2019re unlikely to see the interest rate move on the variable side over the next few months.<\/p>\n

Additional Considerations<\/strong><\/h3>\n

It should be mentioned as well that there has been considerable speculation that the Bank of Canada will cut rates before the end of the year. While this would be even more beneficial considering a mortgage, those same economists say we shouldn\u2019t hold our breath in that one. The belief is that unless we see those risks affect the domestic economy, it is unlikely rates will decline this year. In contrast to the US, real policy rate in Canada is still 1.75% and inflation was 2%. Long story short, the real interest rate here in Canada will be lower.<\/p>\n

Sign up with Real Estate Leads here<\/a> and receive a monthly quota of qualified, online generated buyer and \/ or seller leads that are delivered to you exclusively<\/em> and for your privately-served region of any city or town in Canada. It\u2019s a dynamite way to supercharge your prospecting efforts, and you\u2019re almost certain to see your business grow exponentially<\/p>\n","protected":false},"excerpt":{"rendered":"

As a realtor, one of the things you\u2019ll encounter often is people who are adamant that variable-rate mortgages are always preferable when financing a home. There\u2019s a lot to be said for them, no doubt, and it\u2019s one of the many things a client may ask their realtor long before they talk to a mortgage […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[1],"tags":[123,130,105],"class_list":["post-627","post","type-post","status-publish","format-standard","hentry","category-general-topics","tag-affordable-real-estate-leads-in-canada","tag-canadian-mortgage","tag-mortgage"],"yoast_head":"\nDecline in 5-Year Fixed Mortgage Rate a Big Plus for Prospective Buyers - Real Estate Leads Blog<\/title>\n<meta name=\"description\" content=\"Decline in 5-Year Fixed Mortgage Rate a Big Plus for Prospective Buyers - Real Estate Leads Blog\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.realestateleads.ca\/blog\/decline-in-5-year-fixed-mortgage-rate-a-big-plus-for-prospective-buyers\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Decline in 5-Year Fixed Mortgage Rate a Big Plus for Prospective Buyers - 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