With people banking on the main interest rate going up in June, it seems like a good time to for homeowners to lock in their fixed-rate mortgages.
In the past year about 12 percent of mortgage holders with fixed-rate mortgages "locked in," or switched from variable rate mortgages, according to a report by Will Dunning, chief economist at CAAMP, and another 10 percent had already switched from a variable rate more than a year ago.
The rate for conventional five-year mortgages was at 6.25 per cent at the end of April -- that's near ing the 5.25 per cent rate at the end of May last year - the lowest since 1973 when the Bank of Canada data began.
"As interest rates rise, expect home buyers to increasingly opt for fixed-rate loans, in turn leaving banks with more fixed-rate assets to hedge in the swap market" said Mohammed Ahmed, a rates strategist at Canadian Imperial Bank of Commerce in Toronto.
Housing starts rose to a seasonally adjusted annual pace of 201,700 units last month.