Mortgage Blog

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Where are the Rates Now compared to Last Year?

January 13, 2020 | Posted by: Ask Ana Cruz

Look where we started and look where we ended up. 

2019 brought by many changes and un-certainty with the federal election, the many rate waves, the First-Time Home Buyer Incentive (FTHBI) program launched by the Federal Government, the underlying fear of more government changes. 

Let’s look back at 2019 and see how the year actually looked now that it’s over.

First let’s address the elephant in the room: RATES

First a little explanation for those that may not be familiar; there are different rates for different types of mortgages. Here are just two types;

Insured Mortgages - this applies to mortgages where the purchaser has less than 20% down payment 

Conventional Mortgages - this applies to mortgages where the purchaser has more than 20% down payment 

I went back to the beginning of 2019  and compared it to where we are now and you know what I found? 

Insured mortgage rates were at an average of 3.69% for most lenders and as of today, the second week  of January we are at an average of 2.89%

Conventional mortgage rates were at an average of 3.89% for most lenders and as of today, the last week of December we are at an average of 3.09%

If we just look at the beginning and the end of this year,  it’s evident that we finished much stronger than we started. However, what these numbers don’t show you is that at times this year, the rates were as low as 2.39% and 2.69%. 

Often you will hear brokers say that “you want your mortgage to come due on an election year as there are a lot of changes (always a gamble if they are good or bad changes)”.

With the release of the federal budget in 2019 we also saw the launch of the FTHBI program, a program which in fact doesn’t benefit as many first-time homebuyers as we had all hoped. This program essentially requires first-time buyers to have the first 5% down payment and then CMHC will offer to top them up by another 5-10% depending on the type of home. This will reduce the buyers mortgage amount thus reducing the mortgage payment. In theory it’s a nice idea, however a program that missed the mark altogether in my books.  The limitations and restrictions that they put on this program essentially means that buyers who are looking in the GTA won’t qualify for this program. And don’t forget, if you do qualify, you now share the equity in your home with CMHC, so as your equity grows, you will be splitting that increase in equity. 

I started this post off by saying ‘look where we started and look where we ended up”, the reality is that nothing much has changed. Mortgage rates go up and down as they do each year, the federal government launched a program that was not needed or asked for. We have seen a slight increase in consumer debt since the beginning of the year and still waiting for the government to address the stress test, possibly bring back 30 and 40 year mortgages, actually step up and help first-0time home buyers afford home prices.…and so now we wait to see what 2020 has in store for us. 

Mortgage Broker, Ana Cruz and her team have two offices to better serve you. 651 Fennell Ave East, Hamilton  and 5063 North Service Road, Suite 200, Burlington. Ana can be reached at 905.870.0513 or you can email her at Want to hear what other people are saying about Ana Cruz, Mortgage Broker with Mortgage Architects? Click here. Buying a property? Refinancing a property? Renewing a mortgage? Click here to apply If you would like to book an appointment to meet with Ana Cruz, please click here   

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