What does that mean for your mortgage right now?
For those with a fixed rate mortgage, this won’t impact your current payments. You locked in for a particular rate for the duration of the term (most commonly 5 years) so your payment will not change.
If you have a variable rate mortgage or HELOC, how big of an increase are we talking?
The median sale price in the region over the last 12 months was $765,000. Let’s say you put 10% down and signed a 5-year variable mortgage when rates were at 2.15%. Your monthly payment would be about $3,057. A 0.50% rate increase would see your new payment set at $3,233. A difference of $176 per month.
For most homeowners this is not exactly earth-shattering from a cost perspective and unlikely to cause an increase in defaults.
The video below is the release of the April Monetary Policy Report from the Bank of Canada for April 2022.