News Update: CTV News – January 8th

Clinton Wilkins joins CTV News to comment on the rise in popularity for variable rate mortgages and three-year fixed rates.

Considering shorter-term mortgages, betting on future rate decreases.

Jesse Thomas
Dave Steele is playing the waiting game with his mortgage, holding out on his renewal as long as he can, hoping the interest rate drops by the time he has to sign a new agreement.

Dave Steele
But if I can wait as long as possible to execute that plan that’s going to help me because if the rates continue to go down, I want the best rate I can.

Jesse Thomas
His mortgage deadline is in August. Inevitably, he knows it will cost him more with interest rates where they are.

Dave Steele
I know the rate I’m getting right now is in the low twos, and I know I’m not going to get that.

Jesse Thomas
But he’s not the only one facing the financial squeeze. Across the country, there are 1.2 million mortgages up for renewal this year, according to the Canada Mortgage and Housing Corporation, 85% of those mortgage agreements were contracted when the Bank of Canada interest rate was at or below 1% right now, that key interest rate sits at 3.25% it did sit at 5% this time Last year. Steel usually a “five-year fixed-rate” guy, is now considering a shorter term.

Dave Steele
Now, I’m willing to try things a little differently.

Jesse Thomas
Like many Canadians, he’s betting on a shorter-term mortgage with the hopes the interest rate will eventually find its way back down closer to that 1% mark.

Clinton Wilkins
Everybody’s situation is a little bit different. I can tell you, that a variable-rate mortgage is certainly more popular than it was a couple of months ago. I would say one of the most popular mortgage products that we’re doing right now is a three-year fixed.

Jesse Thomas
Halifax-based mortgage broker Clinton Wilkins anticipates a gradual cooling off of the interest rate as the Bank of Canada slowly eases that overnight rate.
Clinton Wilkins
I think the renewal landscape is more optimistic than it was. Maybe in 2024, we saw a lot of rate decreases, and I think things are more stable now than they were last year.

Jesse Thomas
Wilkins best advice is just that to seek advice from a mortgage professional. Meanwhile, the Bank of Canada is expected to revisit the key interest rate at the end of January. It’s hard to predict if that interest rate will come down again, but that’s what many here are hoping for, Todd.

Todd Battis
No doubt. Jesse is in the Halifax studio this evening.