Historical Mortgage Rates

Learn more about the history of mortgage rates, and how they have evolved over time.

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Mortgage rates have varied a great deal over the past several decades.

The History Of Mortgage Rates In Canada

While rates are currently on the rise, which might make some buyers a little nervous about taking on a mortgage, it’s important to look at the broader historical context. In the early 1980s, for example, mortgage rates were almost 20%! So even though rates are starting to go up again after a period of relative stability, they’re still quite low by historical standards.

Here is a brief history of mortgage rates in Canada:

  • In the early 1980s, mortgage rates were around 18%
  • In the late 1980s and early 1990s, rates fell to around 12%
  • In the mid-1990s, rates fell to around 4%, and then rose again by the end of the decade to about 8%
  • In the early 2000s, rates dropped back down to around 5%
  • Since then, rates have remained relatively low, hovering around 5% or less in recent years

Keep in mind that these are just averages – specific rates may vary depending on your credit score and other factors.

What Are The Factors That Can Affect The Mortgage Rate?

There are many factors that can affect mortgage rates, such as:

For example, if the Bank of Canada raises interest rates, this will usually lead to higher mortgage rates. On the other hand, if the economy is struggling, mortgage rates might fall to encourage people to buy homes.

As stated above, there are also personal factors that can affect your individual mortgage interest rate, such as your credit score. So if you’re considering buying a home, it’s a good idea to check your credit score and get pre-approved for a mortgage before you start house hunting. This will give you a good idea of what kind of interest rate you can expect to pay.

How do Historical Mortgage Rates Affect Home Purchases?

Generally speaking, lower mortgage rates encourage home purchases because lower rates mean less interest paid overall. However, the cost of the home must also be taken into account. A higher-priced home with a lower interest rate can, in fact, save you money over the term of your mortgage.