On December 11, 2024, Tiff Macklem and the Bank of Canada (BOC) cut interest rates by half a percent, bringing the overnight rate to 3.25%. This change has significant implications for variable rate mortgages and lines of credit, while fixed rates remain influenced by bond yields. Banks are also adjusting discounts on variable rates due to increased demand. Furthermore, new mortgage rules introduced 30-year amortizations for insured loans and first-time buyers with less than 20% down. Economist Derek Holt from Scotiabank calls it a hawkishly large cut, sparking discussions about future rate trends and potential impacts from international factors like U.S. tariffs. The episode also covers how these changes may affect the Canadian real estate market, with projections indicating a possible early spring market favoring sellers and increased property transactions.

Alex McFadyen is a seasoned independent mortgage broker with over 11 years of experience in the industry. Alex is the owner and Mortgage Advisor of Flow Mortgage Co.

Alex’s Social Media: @themortgagepug

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