First Foundation’s Best Rates to Open the Week:
1 Year 2.64%
2 Year 3.20%
3 Year 3.34%
4 Year 3.44%
5 Year 3.59%
7 Year 4.69%
10 Year 4.99%
ARM / Variable 2.18%
Line of Credit 3.50%
Prime Rate 3.00%
Qualifying Rate 5.39%
The Toronto stock market started the second half of the year on a strong note, racking up solid gains based on positive economic data from the U.S. and higher gas and oil prices.
The S&P/TSX composite index gained 85.62 points to close at 13,386 on Monday. The TSX Venture Exchange went up 17.73 points to 1,921.91, while the loonie was up 0.4 of a cent from Thursday’s close to 104.08 cents US.
This time last week, rates were moving downward, however a week later the winds have changed once again and rates are now making their way back up. Five-year Government of Canada bond yields snapped back by 30 basis points on Monday due to the latest Consumer Price Index (for May) coming in higher than expected at 3.7%, the largest increase since March of 2003. Core inflation was also on the rise at 1.8% which was up from 1.6% in April.
On the International scene, the market reacted positively to the Greek parliament’s passage of its latest austerity plan and the bailout arrangements proposed by the Eurozone. In addition, surprisingly positive news from the U.S. contributed to the rally by way of the latest ISM number (a key measure of business activity) and the most Case-Schiller house price index numbers, which showed a slowing rate of house-price declines.
RBC kicked off a round of mortgage rate hikes on Monday and most lenders are expected to follow suit over the next few days. In addition, if Canada’s other major lenders do join in on the rate hikes this week, the benchmark or “qualification rate” will rise from 5.39% to 5.54% next Monday, July 11th, making it harder to qualify for high-ratio mortgages with a variable or 1 to 4 year fixed rate.
Contact one of our licensed mortgage brokers as soon as possible to lock in a fixed rate for the next 90 to 120 days if you are planning on purchasing a home this summer or early fall or complete our secure, online application.
A rate hold doesn’t cost you anything but could save you thousands of dollars in interest!