Canada Revised Mortgage Rates for October 2024: If you’re planning to purchase a home in Canada, staying informed about mortgage rates is crucial. Mortgage rates represent the interest charges on housing loans, and these rates play a key role in determining long-term housing costs and monthly payment obligations. As of now, the Bank of Canada (BoC) has set the interest rate at 4.25 percent. The next rate adjustment will be announced on October 23, 2024. Several factors, including inflation, economic conditions, market dynamics, and decisions by the BoC, can influence these rates.
This article provides an updated look at Canada’s mortgage rates for October 2024, so be sure to read through for all the key details.
Canada Revised Mortgage Rates: Overview
| Article On | Updated Mortgage Rates in Canada for October 2024 |
| Country | Canada |
| Year | 2024 |
| Revised Mortgage Rates for October 2024 | See details below |
| Category | Finance |
| Official Portal | bankofcanada.ca |
Updated Mortgage Rates for October 2024 in Canada
Tiff Macklem, Governor of the Bank of Canada, recently noted that further reductions in mortgage rates could be expected if inflation continues to decline. In the first half of 2024, Canada’s population grew by 3 percent, while the economy expanded by 1.5 percent. This disproportionate growth indicates that supply in the country is exceeding demand.
For those lacking sufficient funds to purchase a home outright, taking out a loan is a common solution. The inflation rate directly impacts mortgage rates in Canada, with higher inflation driving mortgage rates higher as well. Over recent years, inflationary pressures have been on the rise, but since June 2024, there have been positive signs of relief. Inflation has also led to increases in rental costs across the country. As of December 2023, the housing inflation rate stood at 7 percent.
Understanding Mortgage Interest Rates
Mortgage interest rates refer to the cost charged by a lender for borrowing funds to purchase a property. When a borrower takes out a mortgage, they agree to pay interest on the principal amount over time. The structure of the loan can affect how these payments are made: in a fixed-rate mortgage, the payment amount remains constant, while in a variable-rate mortgage, the payment fluctuates based on changes in interest rates. The rates set by the lender significantly influence the total amount a borrower will repay.
Also Read- Canada Resettlement Assistance Program 2024: What is the Eligibility & Know About Amount
Canada’s Updated Mortgage Rates for October 2024: Key Insights
This section provides an update on the adjustments to mortgage rates in Canada. Following a period of high inflation, which persisted until April 2024, there has been a noticeable decline starting in June 2024. The Bank of Canada has responded by reducing interest rates twice this year—first by 0.25 percent in the initial half and again by the same amount in the latter half. In April 2024, the mortgage rate was set at 5 percent.
As inflationary pressures eased in June 2024, the mortgage rate was reduced by 0.25 percent to 4.75 percent. This downward trend continued into July 2024, with the rate falling another 0.25 percent to 4.50 percent. These reductions aim to lower borrowing costs and encourage investment and spending in the housing market. While there are no official projections for October 2024 as of now, the current trend suggests a continued decrease in rates.
The table below outlines the mortgage rate changes in Canada for 2024 so far:
| Date | Target Rate (%) | Change (%) |
|---|---|---|
| 4th Sept 2024 | 4.25 | -0.25 |
| 24th Jul 2024 | 4.50 | -0.25 |
| 5th Jun 2024 | 4.75 | -0.25 |
| 10th Apr 2024 | 5.00 | – |
| 6th Mar 2024 | 5.00 | – |
| 24th Jan 2024 | 5.00 | – |
| 6th Dec 2023 | 5.00 | – |
| 25th Oct 2023 | 5.00 | – |
| 6th Sept 2023 | 5.00 | +0.25 |
Regional Mortgage Rates
Let’s examine the mortgage rates and housing market trends across several Canadian provinces:
Alberta: The province of Alberta is experiencing a housing sale rate of approximately 6.3 percent, contributing to a favorable market for home sales.
British Columbia: Compared to the previous year, British Columbia has seen a modest increase of just 1 percent in its housing market. However, there has been a significant decline of 19 percent in the number of residential units.
Ontario: In April 2024, Ontario recorded around 38,445 new home listings. The province has witnessed a 10.1 percent rise in home sales. By June, the number of new housing listings in Ontario had reached 39,164.
Conclusion
Staying informed about mortgage rates is essential for anyone considering purchasing a home in Canada. As of October 2024, the Bank of Canada has set the interest rate at 4.25 percent, with the next rate adjustment expected on October 23, 2024. Recent trends indicate a downward adjustment in mortgage rates due to easing inflation and economic conditions. This trend could provide a more favorable borrowing environment for potential homeowners.
Regional variations in housing markets are also notable, with Alberta showing a solid housing sale rate, British Columbia experiencing modest growth but significant declines in residential units, and Ontario demonstrating a rise in new listings and home sales. Understanding these dynamics will help prospective buyers navigate the housing market effectively.
FAQs
What factors influence mortgage rates in Canada?
Mortgage rates in Canada are influenced by several factors, including inflation, economic conditions, market dynamics, and decisions made by the Bank of Canada. These elements can cause fluctuations in interest rates, affecting long-term housing costs and monthly payments.
What is the current mortgage rate set by the Bank of Canada?
As of October 2024, the Bank of Canada has set the mortgage rate at 4.25 percent. The next rate adjustment will be announced on October 23, 2024.
How have mortgage rates changed in 2024?
In 2024, mortgage rates have decreased from 5 percent in April to 4.50 percent by July. This reduction is a response to easing inflation and aims to lower borrowing costs and stimulate investment in the housing market.
How does inflation impact mortgage rates?
Inflation directly impacts mortgage rates; higher inflation typically leads to higher mortgage rates. Conversely, a decrease in inflation can result in lower mortgage rates, as seen in recent months.