November Mortgage Rate Update: Why Now Might Be the Time to Go Variable in Vancouver

Happy November! It’s hard to believe we’re already in the final quarter of the year—time flies. As we head into the winter season, there’s encouraging news on the mortgage front. The Bank of Canada has recently lowered rates by 0.5%, giving a boost to homebuyers and owners looking to maximize savings on their mortgages. Even better, economists suggest there may be another rate drop on the horizon this December.

I’m Taylor Ross, a Vancouver-based realtor, here to share what these changes could mean for you and your plans to buy or invest in Vancouver’s housing market.

Why Variable Rate Mortgages Are Now More Attractive

With the recent rate cut, variable-rate mortgages have started to gain an edge over fixed rates, which many borrowers opted for in recent years. Here’s why:

• Discounted Variable Rates: Right now, lenders are offering variable rates at prime minus 0.75% to 1%, bringing them down to the 4.95% to 5.2% range. This trend means variable mortgages now sit lower than the fixed-rate options in the low to mid-4% range (for 3- and 5-year terms).
• Potential for More Savings: If economists’ predictions hold and rates continue to drop, borrowers with variable rates could see their interest rates dip to 4.2% or even 3.95% within the next year. For qualified borrowers, this can add up to substantial savings by the end of the mortgage term.
• Flexibility to Lock-In: Many lenders allow borrowers to lock in their variable rate without penalty if rates change. This flexibility provides a financial advantage for anyone looking to switch to a fixed rate later on.

Should You Consider Switching to a Variable Rate?

Choosing a variable rate now could save you more over the long term than locking into a mid-4% fixed rate, especially if rates continue to decline. However, every financial situation is unique. Here’s how to make the best choice:

1. Assess Your Timeline and Financial Goals: If you’re planning to hold onto your property long-term, the potential savings with a variable rate can be appealing. However, if short-term stability is a priority, a fixed rate might offer more peace of mind.
2. Evaluate Your Risk Tolerance: Variable rates fluctuate with prime rates, so if the idea of changing monthly payments isn’t ideal, consider if this option aligns with your comfort level.
3. Consult with a Mortgage Specialist: Many lenders are offering substantial discounts, making it a great time to explore options. Connect with your mortgage advisor to see if switching makes sense for you.

Ready to Discuss Your Real Estate Goals?

I’m here to help you navigate Vancouver’s real estate market with updates on mortgage trends, property insights, and more. Feel free to reach out or visit website for the latest on how today’s rates could work in your favor. Let’s make the most of this evolving market together!