The Latest COVID-19 Mortgage Developments: Rates on the Rise
Updated: Nov 16, 2022
Mortgage Rates on the Rise
Mortgage Rates Rising Rapidly
Canada’s Real Estate Market Faces Uncertainty
Call to End to Open Houses
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Banks and other mortgage lenders have been frantically raising rates since last week due to liquidity concerns and heightened credit risk. The increases continued over the weekend and are expected to persist throughout the week.
Lenders have hiked the rates they make available to brokers by upwards of 70 bps in some cases. Some of the big banks, including National Bank and RBC, have recently hiked their special rates. RBC raised all of its “special” fixed mortgage rates by 40 bps on Wednesday.
Variable rates are also on the rise as discounts from prime rate are quickly evaporating. Certain floating rates were available for as low as prime – 1.10% earlier last week, but recent increases have brought many rates back up, in some cases back up to prime (2.95%) and higher.
What was shaping up to be a hot spring housing market has fizzled due to concerns over the coronavirus.
Real estate markets across the country have seemingly been frozen due to concerns by both buyers and sellers over the full economic impact of the virus. Although, we won’t know for certain the full impact until the data is released about a month from now.
Two of the country’s major real estate associations have called for an end to open houses during the COVID-19 pandemic.
“I am calling on all Realtors to cease holding open houses during this crisis and advise their clients to cancel any that are planned,” said Sean Morrison, President of the Ontario Real Estate Association.
The Toronto Regional Real Estate Board made a similar appeal to members.
“TRREB is strongly recommending that Members stop conducting in-person open houses during the Ontario State of Emergency, and continue to offer best practices due to the uncertainty we’re faced with in dealing with COVID-19,” it said in a statement.
Just days before, two of the country’s largest brokerages, RE/MAX and Royal LePage, issued a similar call for their members to stop staging open houses.