Fixed Mortgage Rates Edging Upward

This week, many of our lenders have increased their fixed rates thanks to the rising cost of borrowing in the bonds market.

At the opening of the week, First Foundation’s best 5 years fixed rate was 3.495 but as of midnight Tuesday, it had increased to 3.69%.

Here are our revised best rates:

Term Mortgage Rates

1 Year 2.45%
2 Year 3.20%
3 Year 3.19%
4 Year 3.49%
5 Year 3.69% ( up from 3.49%)
7 Year 4.75%
10 Year 5.14%
ARM / Variable 2.20%
Line of Credit 3.50%

Royal Bank ( RBC) was the first of the big banks to announce increases this week, pushing their five years fixed “special” rate above the 4% mark as well as increasing their one year. Toronto Dominion Bank followed suit with their increases taking effect at midnight Dec.15th. Many of our non-bank lenders have also raised their 5 year fixed rates but are still well below the 4% mark with the best rate available being 3.69%.

The changes follow cost hikes in the North American bond market, where banks raise money to finance mortgage loans to consumers. Investors have been dumping North American bonds and rotating cash into the rising stock market, forcing banks and other borrowers to pay higher interest rates on bonds to attract investors.

In fact, both 5- and 10-year Canada bond yields are currently at a 5 months high of 2.49% and 3.32% respectively. As such, when costs in the bond market increase, hikes to fixed rate mortgages typically follow.

Some experts believe the slight increases to the fixed rate this week are only the beginning of further increases in the coming weeks. It’s hard to know for sure but it is safe to say that the current fixed rates are still outstanding and if you are considering buying in the next three to four months in the Edmonton or Calgary area, it’s worth contacting one of our mortgage brokers to lock one in via a pre-approval, just in case!


As the company’s first employee, Jennifer has been a Licensed Mortgage Associate since 2004, but her current role is not focused on mortgages. She is the resident blog writer and…

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