A housing development in Middlesex Township, Pa., is shown on Aug. 12, 2023.Gene J. Puskar/The Associated Press
Uninsured mortgage rates climb again
The leading nationally-advertised uninsured mortgage rates marched another 5 to 15 basis points (bps) higher this week, depending on the term.
Insured rates stayed put.
That’s widened the gap between uninsured and insured rates once again. It’s making the buy-default-insurance strategy, which I wrote about last week, even more relevant for those with mortgages between 65.01 per cent and 75 per cent of their home value.
McLister: Why 7 per cent mortgage rates would be unsustainable
Thankfully, the 5-year government yield, which heavily influences fixed mortgage rates, is down again Thursday. It’s fallen 29 bps below its 16-year high set just nine days ago.
But we’re not out of the woods yet.
The Fed’s closely-watched “Supercore” inflation measure rose again on Thursday. Third quarter U.S. GDP is smoking, too. The temperature of the U.S. economy is relevant, of course, since American rates typically lead Canadian rates.
The latest macro readings have central bankers thinking they may need to jack up rates further to suppress inflation. Before any conclusions about that, however, let’s see how Canadian GDP and the big kahuna of economic reports, U.S. jobs numbers, pan out on Friday.
Rates were sourced from the MortgageLogic.news Canadian Mortgage Rate Survey on Aug. 31, 2023. We include only providers who advertise rates online and lend in at least nine provinces. Insured rates apply to those buying with less than a 20 per cent down payment or switching a pre-existing insured mortgage to a new lender. Uninsured rates apply to refinances and purchases over $1-million and may include applicable lender rate premiums. For providers whose rates vary by province, their highest rate is shown.
Robert McLister is an interest rate analyst, mortgage strategist and editor of MortgageLogic.news. You can follow him on Twitter at @RobMcLister.
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Robert McLister