A HEAD TURNING SIX-MONTH MORTGAGE RATE, BUT WITH A CATCH
There was little movement from the mortgage rate leaders this week. Among the lowest nationally-advertised offers, only two rates bothered to budge:
- The default insured two-year fixed rose five basis points to 4.04 per cent
- The uninsured five-year hybrid climbed two basis points to 4.44 per cent
We don’t usually track six-month rates, but a new offer from True North Mortgage demands a double-take. They’ve slashed their six-month insured fixed to a world-beating 1.99 per cent. The catch is, you have to renew with them at a 10- to 50-basis-point premium to their advertised rates, or cough up a one per cent fee.
The biggest perk of six-month mortgages is smoother qualifying, given that they require a less punishing government ‘stress test’ (at least based on today’s rates). In other words, you don’t need to prove you can afford as high an interest rate , which means you can borrow more.
On the topic of cheap money, real estate investors would kill to see 1.99 mortgage rates right about now, particularly in struggling markets like Toronto. But the rate fairies won’t be delivering miracles any time soon.
Bond yields , core inflation and price expectations are all on the upswing. Worse yet, inflation breadth — the share of consumer prices growing at more than three per cent a year — sits at almost 40 per cent, according to figures compiled by Statistics Canada. That’s meaningfully above pre-pandemic levels and a red flag for the Bank of Canada .
On the home front, property values in certain beaten-down markets are showing new signs of life. Data from digital real estate firm Wahi reveal the median home price in the Greater Toronto Area is up 3.1 per cent in the first 15 days of the month, versus April. Yet, sales are down 51.8 per cent versus the first 15 days of May 2024, and active listings are up 50.5 per cent year-over-year.
Even with buyers ghosting sellers, existing home sellers in most markets remain stubbornly optimistic, refusing to swing at lowball offers.
Robert McLister is a mortgage strategist, interest rate analyst and editor of MortgageLogic.news. You can follow him on X at @RobMcLister.
This table reflects the prevailing rates at the time this story was published. For the best mortgager rates in Canada right now, click here .
2025-05-22T20:17:06Z
