📈 Why are fixed rates rising?

Good morning!☀️

Are you wondering why the real estate market hasn’t taken off despite significant rate cuts from the Bank of Canada? Shouldn’t fixed and variable mortgage rates be dropping? In theory, yes—but it doesn’t always work that way.

Our latest blog breaks it all down for you in under 4 minutes.

BoC Rate Cuts Don't Always Lower Mortgages Rates: Learn Why

The Bank of Canada’s policy rate, also known as the overnight rate, is the interest rate at which major financial institutions borrow and lend short-term funds among themselves. It serves as a critical tool in the Bank’s monetary policy, enabling it to influence economic activity and control inflation.

By adjusting this rate, the Bank indirectly impacts borrowing costs for businesses and consumers, including mortgage rates. However, despite recent efforts, the expected ripple effects on mortgage rates—especially fixed mortgage rates—have not fully materialized. This disconnect has left many wondering why the housing market has not responded as anticipated.

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