Latest mortgage news: Big banks cut 5-year fixed rates



CIBC this week became the second Big 6 bank to cut its 5-year fixed mortgage rate.

The bank lowered its rates by 5 basis points, bringing its uninsured 5-year fixed rate to 2.39% and its 5-year variable rate to 1.35%.

The move follows similar cuts from TD Bank on Thursday.

TD moves more, which saw rates drop 45 basis points. This brings its 5-year insured fixed rate (high ratio) to 1.89% (instead of 2.34%) and its uninsured 5-year fixed rate to 1.99% (instead of 2.44%). .

These moves follow a downward trend in bond yields in recent months. The yield on 5-year bonds has fallen from 1.01% in June / July to a range of 0.80% to 0.90% since August. Bond yields generally lead to fixed mortgage rates.

New housing starts slowed in August, according to CMHC

All eyes are on the housing supply these days given historically low inventory levels, which are struggling to meet current strong demand.

That’s why the latest housing starts figures released this week were important, as they serve as a rough indicator of future supply.

Overall, seasonally adjusted housing starts fell to 260,239 units in August, from 270,744 in July, according to the Canada Mortgage and Housing Corporation (CMHC).

The annual rate of urban starts fell 4.7%, led by a 5.7% drop in starts of apartments, condos and other multi-unit dwellings. Urban single-detached housing starts fell 2% year over year.

Despite the drop, housing starts are still well above the long-term average, however

“On a trend and monthly SAAR [seasonally adjusted annual rates] base, the level of housing starts activity remains high by historical standards, ”CMHC noted. “Among Montreal, Toronto and Vancouver, Toronto was the only market to record growth in the total number of SAAR starts in August, due to modest growth in the multi-family segment.

Neo Financial grows in mortgage lending

A fintech company that advertises itself as a “disruptive online bank” should significantly expand its product offering to include mortgages.

Calgary-based Neo Financial Technologies launched a year ago with a no-fee Mastercard and a high-interest savings account. It has since grown nationwide and has over 4,000 retail partners where its cardholders can earn money.

The company just completed a second fundraiser valued at $ 64 million, bringing the total funds raised by the company since its launch to $ 114 million.

The next steps in the company’s expansion are expected to largely include mortgages, as it aims to challenge traditional big banks and gain a growing share of that market share.

“With 90% of the Canadian market share held by the Big Five banks, Neo was designed to give Canadians what they lacked: choice and innovation,” the company says on its website.

In a job assignment for a Chief Mortgage Loan position, the company said: “Neo expands our product offering to include innovative mortgage products backed by cutting edge technology… You will be instrumental in transforming our mortgage business into a domestic brand in Canada. “


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