My friend Mike is laughing all the way to the bank. Not only did he sell his east-end 2-bedroom condo for a sizable profit—$50,000 in a year, after fees—but he also got a new mortgage for his downtown condo at a low-rate of 2.99%.
According to a new survey released yesterday by the Canadian Association of Accredited Mortgage Professionals (CAAMP) the average mortgage interest rate in Canada this year was 3.24%, while the average discount off posted rates was 1.85% (making the average mortgage rate for those that purchased in 2014, a low 2.89%).
The survey provides a few more interesting stats. For instance, 85% of Canadians have 25% of more equity in their home. Apparently we don’t want to stay in debt forever, as 38% of Canadians increased their monthly payment amounts or made a lump sum payment. Yet, 11% of homeowners took equity out of their home, for an average of 58%, with the two main reasons being debt consolidation and renovation.
Surprisingly 76% of the new mortgages written in 2014 were for fixed rate terms, while 69% of outstanding residential mortgages were fixed rate, 24% were variable and 6% were a combination of the two.