Most experts predict mortgage rates have peaked and will not see another increase in 2023.

The average mortgage rate for an insured 5-year mortgage rate in Ontario is 4.29% fixed interest rates and 6% for variables.

Increased interest rates are the typical strategy the Bank of Canada uses to help combat inflation. As we saw in 2022, a series of increases more than doubled the interest rates we enjoyed during the pandemic. As inflation rates slowed, the Bank eased up on increases, and we are now seeing the prime rate flatten out. However, since prime rates drive mortgage rates, if we experience inflation again, the Bank of Canada will increase the prime, leading to mortgage rate increases across Canada. Ideally, the inflation rate should not rise above 3%.

Canada’s prime rate sits at 6.70%. How the prime rate impacts mortgage rates depends on the type of mortgage. Variable mortgages use the prime rate to guide increases and decreases and determine the rate you’ll be offered when you sign your mortgage. Fixed mortgage rates, on the other hand, are based on yields in the bond market. When yields are high, it costs banks more money; therefore, they will increase their fixed rates when yields are high and lower them if yields are low.

TD Bank has the best mortgage rate at 4.89%, 1.45% lower than the highest rate available in Ontario of 6.49% at Scotiabank

Here is an overview of current mortgage rates in Ontario: 

Lender                     Fixed           Variable

Butler Mortgage      4.19%          5.49% 

Neo Financial          4.29%          6.60% 

Nesto                      4.29%         5.45% 

Pine                         4.34%          5.55% 

RateHub/Canwise  4.44%          5.70% 

QuestTrade             4.49%          5.60%

Rocket Mortgage    4.49%          5.75%

Equitable                 4.54%          5.80%

Dominion Lending  4.54%          N/A

Mortgage Alliance   4.54%          5.80%

First National          4.69%          5.55%

Laurentian               4.69%          6.70%

PACE                      4.74%          5.95%

Alterna Savings      4.74%          5.95%

YNCU                      4.79%          N/A

HSBC                      4.79%          5.90%

DUCA                      4.89%          6.70%

TD                           4.89%          6.45%

CIBC                       4.94%          6.20%

BMO                        4.99%          6.39%

First Ontario            5.09%          6.50%

Canadian Western  5.09%          N/A

CMLS                      5.29%          7.20%

Simplii Financial      5.49%          6.55%

Caisse Alliance       5.49%          N/A

National Bank         5.54%          6.50%

RBC                        5.54%          6.50%

Desjardins               5.54%          6.50%

Manulife                  5.69%          N/A

Tangerine                5.74%          6.65%

Motusbank              5.79%          6.75%

Down payments are based on the purchase price as follows:

• $500,000 or less: Minimum 5% of the purchase price
• $500,000 to $999,999: Minimum 5% of the first $500,000 of the purchase price and 10% for the portion of the purchase price above $500,000
• $1 million or more: Minimum 20% of the purchase price

Before you start your house hunt, find the best mortgage rates from Citadel Mortgages. Get yours approved today!