As of December 2024, forecasts indicate that mortgage interest rates in Canada are expected to decline gradually throughout 2025. The Bank of Canada (BoC) has been reducing its policy rate, with projections suggesting it could reach approximately 2.5% by the end of 2025.
This downward trend in the policy rate is anticipated to influence both variable and fixed mortgage rates. Variable-rate mortgages are expected to decrease in line with the BoC's rate cuts. Fixed mortgage rates, while also projected to decline, may do so at a more gradual pace. Some forecasts suggest that five-year fixed rates could drop by about half a percentage point by the end of 2025, potentially reaching around 4%.
Given these projections, it's prudent to prepare for your mortgage renewal. Contacting a mortgage broker, such as Dave Oliver from TMG, approximately six months before your renewal date can provide personalized advice tailored to your financial situation. Brokers can help you navigate the evolving interest rate landscape, explore competitive rates, and ensure you secure terms that align with your financial goals.
Dave Oliver is based in Saskatoon, Saskatchewan, and can be reached at 306-227-7367.
Please note that while current forecasts provide an indication of potential trends, actual interest rates can be influenced by various economic factors. It's advisable to stay informed and consult with a mortgage professional to make decisions that best suit your circumstances.