Clay Jarvis
Beth BuczynskiNerdy Tip: The best Winnipeg mortgage rates got a little better after the Bank of Canada lowered its overnight rate on July 24. Lenders responded to the cut by lowering their prime rates and variable mortgage rates by 25 basis points. Three- and five-year fixed mortgage rates remain comfortably below 5%. Current activity in the government bond market could open the door to moderate decreases.
Disclaimer: 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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Winnipeg mortgage rate update: July 2024
On July 24, the Bank of Canada’s second consecutive overnight rate cut helped lower variable mortgage rates in Winnipeg by 25 basis points. Variable rates are still generally in the 6% range, particularly at the Big Six banks, but they should keep ticking down. Another two cuts from the Bank could be on the table this year. If both materialize, variable mortgage rates would shrink by at least another 0.5%
Fixed mortgage rates are holding steady in Winnipeg. As of July 25, 2024, five-year fixed mortgage rates remain below 4.7% at some lenders, while three-year fixed mortgage rates can still be found for around 4.9%.
Recent activity in the government bond market, where bond yields have been sinking, could open the door for lenders to improve their fixed rate offers later this month.
Winnipeg mortgage rate forecast
Variable mortgage rates
After the Bank of Canada’s decision to lower its overnight rate on July 24, variable mortgage rates continue shrinking. A reduction in the overnight rate typically leads to an identical decline in lenders’ variable rates.
How many times variables dip in the last half of 2024 remains to be seen. The Bank of Canada will be cautious about cutting the overnight rate too quickly, which could trigger another rise in inflation. Another two modest cuts by year end is a reasonable expectation.
Fixed mortgage rates
Because they’re driven by lenders’ reactions to activity in the government bond market, fixed mortgage rates can be difficult to predict over the long-term.
Based on bond activity in the latter half of July 2024, for example, lenders could drop their three- and five-year fixed mortgage rates moderately in August, but there weren’t many bargains on offer at the time of this writing.
Fixed mortgage rates could be somewhat lower by the end of 2024, but it’s unlikely that they’ll fall significantly below 4.5%.
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Winnipeg Housing Market Update
Average home prices in Winnipeg
According to the Winnipeg Regional Real Estate Board, the 1,585 homes sold in June was about the same as in June 2023.
In June, the average sale price in Winnipeg by property types included:
- $447,884 for detached homes.
- $268,356 for condominiums.
Winnipeg home sales and price forecast
Prices and sales in Winnipeg could remain static for much of 2024. Demand should remain high, but so will interest rates.
As one of Canada’s most affordable places to live and own property, Winnipeg should continue attracting new residents from other provinces and other countries, which will keep pressure on provincial housing stock. Without the population boom being seen in Alberta, however, it’s unlikely that the market will experience the same surge.
Low prices and high rents are also attractive to real estate investors, who may covet properties in Winnipeg, Brandon and Steinbach for their profitability. The more properties that get snapped up by investors, the tighter the market will become.
But high mortgage rates, economic uncertainty and heavy debt loads will likely keep a lid on the market for the first half of the year.
Land transfer taxes in Winnipeg
When you purchase a home in Manitoba, you’re required to pay a land transfer tax. To determine the tax amount, the province applies unique tax rates to different segments of the purchase price.
- On the first $30,000: 0%.
- From $30,001 to $90,000: 0.5%.
- From $90,010 to $150,000: 1%.
- From $150,001 to $200,000: 1.5%.
- On any amount above $200,000: 2%.
On a home worth $300,000, the land transfer tax would total $3,650. But you’ll also have to pay one or two registration fees. Registering a new title will cost $124, as will registering a new mortgage.
Manitoba first-time home buyer programs
There aren’t many provincial programs available to eligible first-time home buyers in Manitoba. Two of the only ones still available are:
- The First-Time Home Purchase Program, which helps homeowners of Metis descent purchase homes by providing funds that can help with down payment and closing costs.
- The Rural Homeownership Program, which provides financial assistance to eligible home buyers purchasing either a single-family or semi-detached home in certain rural communities.
First-timers in Manitoba can also make use of federal programs like the Home Buyers’ Plan and the First Home Savings Account.
Guide to mortgage rates in Winnipeg
Types of lenders in Winnipeg
Mortgage lenders in Winnipeg tend to fall into four categories, which include:
- Large chartered banks such as Scotiabank, RBC and TD.
- Credit unions such as Access Credit Union and Assiniboine Credit Union.
- B lenders that work with borrowers with lower credit scores, such as True North Mortgage and Neo Financial.
- Private lenders, who typically deal with borrowers in need of short-term funding.
Types of mortgages in Winnipeg
Fixed-rate mortgages
With a fixed-rate mortgage, the rate stays the same for the duration of the mortgage term, even if rates fluctuate.
Fixed rates provide certainty, which can make them easier to budget around than variable mortgage rates. That certainty comes at a price, though: Outside a few exceptions, fixed rates have historically been higher than variable rates.
Variable-rate mortgages
Variable mortgage rates rise or fall depending on which direction your lender’s prime rate moves. Depending on the state of the economy, a variable rate can increase or decrease multiple times during a mortgage term.
Variable rates are risky, which is why they’re typically lower than fixed rates. In a high-inflation environment, when lenders’ prime rates are driven upward by increases to the Bank of Canada’s overnight rate, variable mortgage rates can skyrocket.
» MORE: The difference between fixed- and variable-rate mortgages
Hybrid-rate mortgages
If you take out a hybrid-rate mortgage, a portion of your mortgage is subject to a variable rate and another portion is at a fixed rate of interest. Hybrid mortgages can dampen the impact of fluctuating interest rates in a particularly turbulent economy, but they tend to be more difficult to transfer between lenders.
Insured and uninsured mortgages
If you buy a home for under $1 million, and your down payment is less than 20% of the purchase price, you must purchase mortgage default insurance, which adds to the cost of your loan. In these cases, you’ll be getting an insured mortgage.
If your down payment is greater than 20%, or you’re buying a home where a 20% down payment is required, like an investment property or a home worth $1 million or more, insurance is not required. In this scenario, you’re getting an uninsured mortgage.
Insured mortgage rates tend to be lower than uninsured mortgage rates.
Short-term and long-term mortgages
Short-term mortgages typically last five years or less. Long-term mortgages last over five years. With a shorter term, you’ll need to renew your mortgage sooner, which can provide flexibility, but it can also increase risk if rates are trending upward as your renewal date approaches.
Closed and open mortgages
The primary difference between closed and open mortgages is that you can pay off an open mortgage whenever you like and not pay a penalty. If you have a closed mortgage and make additional payments that go beyond your pre-payment allowances, you’ll be penalized for breaking your mortgage.
Closed mortgages often offer better rates than open mortgages. But an open rate mortgage may be a good option if you think you may be able to pay off your mortgage early.
» MORE: Understanding open and closed mortgages
How lenders determine mortgage rates in Winnipeg
The mortgage rate you’re offered by a lender in Winnipeg, or any other city in Manitoba, will be based on two primary factors; one based on the state of the economy and one based on your financial situation.
Economic factors
Variable mortgage rates are influenced by the Bank of Canada’s overnight rate. When the overnight rate increases or decreases, a lender’s prime rate follows suit. Variable mortgage rates are based on a lender’s prime rate, so as the prime rate rises or falls, so do variable rates.
Fixed mortgage rates are determined by activity in the government bond market, particularly the yields on one-, three- and five-year bonds. Fixed mortgage rates follow the movement of those yields.
Your financial situation
Factors specific to you also affect the rates you’re offered. These include:
- Your credit score.
- Your income.
- Your total debts.
- The loan type you choose.
- The amount you’re borrowing.
- The term length and amortization period of your loan.
Lenders look for signs of risk when assessing these aspects of your finances. The riskier they perceive you to be as a borrower, the higher the rate they’re likely to offer you.
How to qualify for a lower mortgage rate in Winnipeg
Some of the mechanisms that shape mortgage rates are beyond your control, but there are steps you can take to persuade lenders to offer you the best mortgage rates. For example, you can try:
- Improving your credit score. A higher credit score generally results in better loan offers. Get a better score by eliminating existing debt and paying future bills in full and on time.
- Increasing your income. It’s not always easy, but any additional income you can earn will improve your financial position. Lenders look at your income to assess your ability to afford a mortgage.
- Decreasing your total debts. Lenders consider your total debt load when determining your mortgage rate. Pay down personal loans, student loans or other types of debts if you can.
- Considering all your mortgage options. See if adjusting the loan type, the term length or the amortization period of your loan could result in you being offered a better rate.
Factors that affect mortgage affordability
A home’s price and the rate you’re offered aren’t the only factors that affect how much mortgage you can afford. You’ll also have to account for the following components, which play a role in all mortgages.
Debt service ratios
Lenders use debt service ratios to determine how much of your income goes toward paying debt. If those ratios are too high, you may not qualify for the mortgage amount you need.
Car loans, credit cards and lines of credit are all examples of debt that require regular payments. Decreasing some of these balances, or relying less heavily on credit, can help you lower your debt service ratios.
The mortgage stress test
You will have to pass the mortgage stress test if you want a home purchase funded by a federally regulated financial institution.
The rules of the stress test say you must qualify for a mortgage at a minimum qualifying rate of either 5.25% or the rate you’re offered plus 2%, whichever is higher. If a lender offers you a rate of 5%, for example, you’ll have to demonstrate you can afford the same mortgage at 7%.
You may be able to avoid the stress test if you apply for a mortgage with a lender that is not federally regulated, like a credit union.
Your down payment
Your down payment is a critically important factor in determining mortgage affordability. The more you can put down, the less you’ll need to borrow. Your monthly mortgage payment will likely be smaller, and you’ll pay less in interest.
Mortgage term
The term is the length of time your mortgage contract is valid. In Canada, mortgage terms can run anywhere from six months to as long as 10 years.
Chances are that your mortgage will have multiple terms during the amortization period until you pay it off in full. Once your mortgage term ends, you can pay your loan off in full, renew it or refinance it.
Amortization period
A mortgage’s amortization period is the time it will take to pay off the loan in full. In Canada, the most common amortization period is 25 years. If your down payment is less than 20%, you can’t have an amortization beyond 25 years.
If your down payment is greater than 20%, you may find some lenders willing to offer amortization periods of up to 35 years.
Why would you want a longer amortization period? The longer your mortgage lasts, the smaller your monthly payment will be. You’ll pay more in interest, but that might be a worthwhile trade-off if it helps you keep your home.
How to compare mortgages from Winnipeg lenders
Compare APR
The annual percentage rate (APR) includes fees and closing costs the lender may charge in addition to the interest rate. A lender offering the lowest rate may actually have a higher APR due to those additional costs. Comparing APRs is the easiest way to see the complete cost of each offer.
Compare similar mortgages
For a comparison to be useful, the mortgages should have the same term, amortization period and payment frequency.
When looking for the best mortgage rates in Winnipeg, also consider:
- Mortgage type.
- Ease of application.
- Prepayment penalties.
- Customer service.
- Any other fees not included in the APR.
You can also compare mortgage rates in other areas to get a sense of how the rate you’ve been offered in Winnipeg stacks up:
- B.C. mortgage rates.
- Ontario mortgage rates.
- Alberta mortgage rates.
- Manitoba mortgage rates.
- Saskatchewan mortgage rates.
There’s more to mortgage shopping than the interest rate
Scoring a low mortgage rate might be a home buyer’s prime motivation, but getting the lowest rate doesn’t necessarily mean you’re getting the best mortgage for your needs.
For example, you could opt for a fixed rate, which might cost more than a variable rate, if you’re more comfortable with the certainty that your rate won’t increase during the term. If you expect to come into a sizable sum of money soon (via an inheritance, for example), paying a
Frequently asked questions about Winnipeg mortgage rates
Frequently asked questions about Winnipeg mortgage rates
As of July 2024, some lenders in Winnipeg are offering three- and five-year fixed mortgage rates for well below 5%. A variable rate will still cost you around 6%.
Home buyers shouldn’t expect significant declines in fixed mortgage rates in the latter half of 2024. They’ll likely stay in the 4% to 5% range. Variable mortgage rates will continue decreasing so long as the Bank of Canada keeps lowering its overnight rate. In the second half of 2024, variable rates might come down by another 50-75 basis points.
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