Kurt Woock
Beth BuczynskiDisclaimer: The rates displayed do not include any taxes, fees, insurance, or other additional charges. These rates are estimates and are not guaranteed. The actual rate and loan terms you receive will depend on our partner’s assessment of your creditworthiness, loan amounts, and other relevant factors. Please note that any potential savings figures provided are estimates based on the information you and our advertising partners have provided. Terms and conditions apply.
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Calgary mortgage rate update: September 2024
Mortgage rates in Calgary got a little better on September 4, when the Bank of Canada announced its third consecutive 25-basis point cut to the overnight rate. Once lenders apply the reduction to their prime rates, variable mortgage rates will decline by 0.25%.
That’s not a lot, so it’s not as if the Bank of Canada just made things easy for Calgary mortgage shoppers. Post-cut, variable mortgage rates will still be around 5.9% at most of the country’s biggest banks, though you might find something closer to 5.25% if you use a mortgage broker.
Variable rates might be high, but if you’re comfortable with committing to a three- or five-year term, fixed rates provide a much cheaper alternative. As of September 4, 2024, some brokers were offering three-year fixed rates for below 4.5% and five-year fixed rates for less than 4.25%.
Based on current activity in the government bond market, fixed rates aren’t likely to swing one way or the other in the near future. But lenders are in a competitive/desperate mood these days, so you might be surprised by the fixed rate you’re offered.
The Calgary housing market
Current home prices in Calgary
According to the Alberta Real Estate Association, the median residential home price in Calgary was $563,500 in July 2024, up 14.2% year-over-year. The median detached price was $705,000. The median condo price was $319,500.
Rapid price growth is starting to have a negative effect on sales in Calgary. Even though active listings in July were almost 19% higher than a year ago, sales dropped by 10% over the same period.
Calgary home sales and price forecast
Many Canadians wonder how the Bank of Canada’s rate cuts will affect the housing market. Will it compel buyers who have been cautiously watching from the sidelines, or will they continue to wait, hoping that rate cuts are just getting started? These are the questions real estate experts — and home buyers — will be watching through the end of 2024.
A report released by real estate company Royal LePage forecasts home prices increasing 9% in the last three months of 2024 compared to the same period in 2023. A report from the Canadian Real Estate Association stated that listings are up this summer compared to 2023 but still below historical averages.
Royal LePage’s report said Calgary will have one of Canada’s hottest markets in 2024, with prices expected to rise 8% by year’s end.
Prices in Calgary were up 7.9% year over year in the second quarter of 2024 — and buyers can expect similar price growth through the end of the year.
Why compare mortgage rates in Calgary?
Even though home prices in Calgary are low compared to those in Canada’s other large real estate markets, you’ll want to save as much money as possible on your next mortgage. Comparing the rates offered by different banks and brokers is one way to do that.
Comparing mortgage interest rates can help you understand the impact of even a few percentage points on the size of your monthly mortgage payment and overall cost of your next home loan. Comparing rates can also illustrate the effects of choosing either a variable- or fixed-rate mortgage product, and help you decide which one is right for you.
Finding attractive rates from a few mortgage lenders is just the first step, however. You’ll also want to compare loan details, including prepayment options, fees, and potential penalties. These features all impact the total cost of your mortgage over the lifetime of the loan; depending on how your home ownership journey shakes out, they can be just as important as the interest rate you choose.
How to get the best mortgage rate in Calgary
Whether you’re buying in Calgary, Edmonton, Red Deer or some other community in Alberta, following these tips will put you in a position to get the best possible mortgage rate.
1. Save up a significant down payment
A bigger down payment means you’ll have more equity on day one of home ownership. It also means you can borrow less, and smaller mortgages are less risky in the eyes of a lender — exactly what you want when trying to score a lower interest rate. Proving that you have the ability to save a substantial amount of cash may signal to lenders that you know how to prioritize your spending, too.
2. Strengthen your credit score and lighten your debt load
When lenders encounter a low credit score, they generally come to two conclusions: Either the person has difficulty keeping on top of their debt obligations or they have a short, untested credit history. Either scenario could make a lender think twice about offering you a mortgage, let alone one with a low interest rate.
If you have a strong credit score, but are carrying lots of debt, lenders may still be hesitant to offer you a competitive rate because your credit utilization ratio is too high. (It’s recommended that this ratio be no higher than 30-35%.) Lenders may even ask you to completely pay off one or more of your outstanding balances before they can make you a reasonable offer.
Paying off a substantial chunk of debt with little notice can be difficult to do, so it’s best to whittle your debt down before reaching out to a lender or mortgage broker. It should make the pre-qualification process easier.
3. Consult a mortgage broker
Using a mortgage broker can lighten the burden of hunting for the best mortgage rate. Experienced mortgage brokers have relationships with multiple lenders and can compare their offers with your homeownership goals in mind.
Working with a broker isn’t legally required. You can always fund your next real estate purchase in Calgary by working with one of Canada’s Big Six banks or an alternative lender. But these institutions will only offer their own products.
A mortgage broker can advocate on your behalf when dealing with lenders. Brokers can negotiate lower rates and better terms for their clients, and when they know a person’s personal and financial history — the good, the bad and the improving — they can use that information to convince a lender of their client’s creditworthiness.
Where can you get a mortgage in Calgary?
Being a large city with an active real estate market, Calgary has no shortage of financial institutions that offer mortgages, including:
- Canada’s major banks: RBC, TD, BMO, Scotiabank, CIBC and National Bank.
- Alternative lenders like True North Mortgage, Paradigm Quest, MCAP, and First National.
- Private lenders including MortgageTree, Freedom Capital, and Private Capital Mortgage Ltd.
You can also consider applying for a mortgage with one of Alberta’s many credit unions, including Servus Credit Union, Vision Credit Union, and Bow Valley Credit Union.
Credit unions often offer their members competitive interest rates, and if borrowers can provide a down payment of at least 20%, they may not have to pass the mortgage stress test when applying for a home loan.
Frequently asked questions about Calgary mortgage rates
Mortgage rates are already coming down in Calgary. As of September 4, 2024, the Bank of Canada’s overnight rate cuts have already brought variable rates down by 75 basis points, and they’re expected to fall even further before the end of the year. Fixed mortgage rates ticked down during the summer, and may get even lower if lenders remain in a competitive mood.
As of September 2024, 5% would be considered higher than average for a fixed mortgage rate in Calgary, and essentially impossible to find on a variable-rate mortgage.
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