Abstract:
Mortgage rate Canada was found to be low and it was also found that housing starts are on a rise. The US subprime mortgage crisis did not have any negative impact on Canada because, it was well equipped to withstand the same. The write up below scripts information on the real estate sector in Canada, with more prominence on the rates.
Currently, varied types of mortgage products are offered in Canada to the borrowers depending on the type of mortgage loan applied for. The conventional or traditional mortgage rate Canada comprise a 20% cash down of the value of property. This type of mortgage rate requires the borrower to have a large sum of money but the advantages of availing such a loan rate are many.
Prevailing mortgage rates Canada:
The prevailing mortgage rate Canada as of 6th February, 2008 are as follows:
- For availing a mortgage loan for a period of 10 years. The mortgage rate Canada is 6.30%.
- For 7 years duration, the mortgage rate is 6.25%
- For availing a mortgage loan for a period of 5 years, the mortgage rate is 5.74%
- If the mortgage term is 4 years, the mortgage rate is 6.10%
- In case the mortgage term is for a period of 3 years, the rate of mortgage is 6.10%
- The same mortgage rate applies for a term of 2 years also.(6.10%).
- For one year, mortgage term, the mortgage rate is 5.50%.
- In the event, the mortgage term is only for 6 months, the mortgage rate Canada is 6.50%.
- If the variable rate is opted for the mortgage rate in Canada is 3.24%.
Observations:
- If the mortgage term is for 2,3 or 4 years, the mortgage rate is constant and that is 6.10%.
- Mortgage rate Canada, may be of two types:
- Variable mortgage rate
- Fixed mortgage rate.
Housing starts in Canada:
The authorities in Canada make use of Housing starts as an indicator to judge the housing market in Canada. Housing starts indicate growth rate in construction of houses. Housing starts are very vulnerable to changing economic conditions. According to reports made available by Canada Mortgage And Housing Corporation or CMHC (first quarter), in the year 2007, Canada, housing starts had as many as 228,343 units. There was an increase of 0.4% from the year 2006, when housing starts were 227.395 units in number.
Effect of US subprime mortgage crisis on Canada:
Even though there were oscillations in the housing market in the United States of America, Canada enjoys rise in income gains and low mortgage rates in the country. In the year 2008, it is anticipated that the then housing sector will continue to be robust. 2008 will also be the 7th year at a stretch when housing starts were more than 20,000 units.