High rent rates are making it harder for Canadians to save for a down payment, a Desjardins report by senior economist Kari Norman says.Cole Burston/The Canadian Press
Long-term fixed-rate mortgages have seen slight discounts in recent weeks, but that affordability is still too constrained for Canada’s most expensive markets to rebound this year, according to a Desjardins report published Thursday.
In recent weeks, some of the lowest rates available on Ratehub.ca have dropped by as much as 35 basis points for three-year terms and 10 basis points for five-year terms. (There are 100 basis points in a single percentage point.) The cuts are a result of bond yields dropping this month.
However, high rent rates are cutting into Canadians’ ability to save for a down payment, the Desjardins report by senior economist Kari Norman said. The bank has found that both rental rates and the real estate market in cities such as Toronto remain unaffordable compared with historical standards.
And even though housing prices are declining overall, there is a lack of supply in low-cost housing and that’s preventing people from achieving home ownership, Ms. Norman said.
The report noted that the percentage of adults living with a parent or roommate has been steadily increasing as it’s become too expensive to live alone. That reality is also constraining demand in the housing market in expensive markets, the report found.
What do you want to know about mortgages?
Do you have a mortgage question for our expert? Is a variable or fixed rate the best option? Does it make financial sense to refinance? Is it better to consult your bank or go to a mortgage broker?
Submit your questions below and Ratehub's Penelope Graham could answer it in an upcoming column.
Mortgage rates are sourced by Ratehub.ca. For a comprehensive list of today’s mortgage rates for each term/type, visit ratehub.ca/best-mortgage-rates.
Ratehub.ca is a mortgage-rate comparison marketplace and mortgage brokerage. It helps millions of Canadians compare and obtain the best mortgage rates, credit cards, insurance, deposits and loan products.
Rates shown are the lowest available for each term/type and category (insured versus uninsured) as of market close on Thursday.
