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Best Ontario Mortgage Rates 2022 - Fixed Rates

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Best Ontario Mortgage Rates 2022 - Variable Rates

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Frequently asked mortgage questions

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Getting the best mortgage rates in Ontario

Jamie David

Using our rate tables, you can compare today's best mortgage rates in Ontario from the Big 5 Banks, small banks, credit unions and top mortgage brokers, instantly, all in one place. Shopping around is critical if you want to find the best mortgage for your needs, and can save you thousands of dollars. 

Best mortgage rates in Ontario +

Ontario at a glance

  • Population: 14.83 million - most populous province in Canada, with just over 38% of the country’s population
  • Average Household Income: $74,287
  • Percentage of Homeowners: 70%

Current state of the Ontario housing market

  • Home sales in September 2022 were 12,968 units, down 37.7% from September 2021 (close to the national decline of 32.2% year-over-year).  
  • The average price for resale residential homes in September 2022 was $836,300, a 5.7% year-over-year decrease from September 2021, less than the national average year-over-year decrease of 6.6%. Prices are down in all areas of the province except for eastern and northern Ontario.  
  • Active listings at the end of September 2022 were over 78% higher than the same time last year. New listings for the month of September were down by just 1.7% year-over-year, but this was still the lowest number of new listings added in the month of September for over a decade. 
  • The dollar value of all home sales in Ontario in September 2022 was $10.8 billion, representing a year-over-year decline of just over 41%. 


How do I get the best mortgage rate in Ontario?

 As home to Canada's financial capital, Toronto, Ontario naturally has an extremely competitive mortgage market. All of the Big 5 Banks have their headquarters in Toronto, as do major Canadian credit unions including Meridian Credit Union, DUCA Financial Services Credit Union and Alterna Savings and Credit Union. Many other smaller lenders, credit unions and mortgage brokerages are also located in Ontario. 

With such a variety of options, it's important to remember that the best mortgage rate is not always the lowest rate; rather, it's the one that meets your needs and best suits your financial situation. That makes it all the more crucial that you compare multiple lenders and speak with a mortgage broker. They can walk you through different mortgage products and help you understand the benefits and drawbacks of each so that you can make an informed decision.  

What factors affect the mortgage rate I get?

The mortgage rate that you qualify for will depend on a number of factors, some of the most important of which are: 

  • Your down payment - The size of your down payment will determine the amount of insurance your mortgage will require. The larger your down payment, the less insurance your mortgage will require. Though it may seem counter-intuitive, uninsured mortgages actually have higher rates. This is because lenders take on more risk for these mortgages since they cannot get insurance on them. Though you may not get the lowest rate, it is usually always better to put a larger down payment if you can afford it because you won’t have to pay for mortgage insurance. 
  • Your amortization period - Mortgages with amortization periods greater than 25 years are not usually insurable and therefore come at a higher rate. However, a longer amortization period allows you to have a lower monthly payment.
  • What the property will be used for - Will you be living in the property? Mortgage rates for rental properties are typically higher than for those that are owner-occupied. 
  • Mortgage type - Mortgage rates for refinances are usually higher than rates for renewals and purchases.
  • Your employment status - You need to provide proof of income in the form of paystubs and/or tax documents such as your Notice of Assessment (NOA). If you're self-employed, work on commission, or otherwise do not have a steady income, it can be more complicated and/or expensive. 
  • Your credit score - Your credit score may affect the type of lenders that will work with you. If you have bad credit, you may not qualify for a Big Bank mortgage.
  • Your debts - Lenders will look at your debt service ratio when considering whether to approve your mortgage. Carrying an excessively high amount of debt negatively impacts your debt service ratio as well as lowering your credit score. 

Historical trends in Ontario mortgage rates 

Ontario mortgage rates rise and fall, as do rates across Canada. Here’s an interactive chart showing the lowest mortgage rates in Canada over the past few years to give you an idea of where we are today.

Land transfer tax in Ontario

Land transfer taxes are often overlooked, despite being one of the biggest closing costs when purchasing a home. For people in Toronto, a land transfer tax is levied by the City of Toronto, in addition to Ontario’s provincial land transfer tax.

Ontario land transfer tax

In Ontario, land transfer taxes are based on the purchase price of the property, with the tax rate increasing as the price of the home rises. Here’s a breakdown of the rates:

Source: Ontario Ministry of Finance

*The $2 million bracket was introduced on January 1st, 2020.

 

Toronto Land Transfer Tax

When purchasing a home in Toronto, you’ll also pay a municipal land transfer tax. Toronto’s land transfer tax applies within certain boundaries: Steeles Avenue to the North, Etobicoke to the West, Scarborough to the East, and Lake Ontario to the South.

Here are the current Toronto land transfer tax rates:

Source: City of Toronto

 

Ontario first-time homebuyer programs

In an effort to make it easier for first-time homebuyers to get into the market, there are several programs and rebates available in Ontario. These are available to citizens or permanent residents of Canada who haven’t owned property before. 

Ontario’s Land Transfer Tax Rebate for First-Time Homebuyers provides a rebate of the full amount of your land transfer tax, up to a maximum of $4,000. If you are buying with a spouse who does not qualify, you will only be eligible for 50% of the refund. 

Toronto’s First-Time Homebuyers Land Transfer Tax Rebate provides a rebate of the full amount of your municipal land transfer tax, up to a maximum of  $4,475. This rebate is available regardless of whether you buy a townhouse, house, or condo. You can use the Toronto land transfer tax rebate in addition to the Ontario land transfer tax rebate. 

Learn more by reading our guide to First-Time Homebuyer programs in Canada.

Ontario non-resident speculation tax

In an effort to prevent foreign investors from inflating housing prices in Ontario, the Ontario government places a 15% tax on all purchases of residential properties by foreign buyers in the Greater Golden Horseshoe area. This is on top of any land transfer taxes. Foreign buyers include overseas corporations, as well as individuals who aren’t Canadian citizens or permanent residents.

 

Changes on the horizon

On October 25, 2022, the government of Ontario introduced the More Homes Built Faster Act, which is part of a long-term strategy to increase the housing supply and ensure that affordable housing options exist for Ontarians. Significantly, the provincial government aims to facilitate the construction of 1.5 million new homes over the next decade.

Jamie David, Director of Marketing and Head of Mortgages

Jamie David is the Director of Marketing and Head of Mortgages at Ratehub.ca. A graduate of the Systems Design Engineering program at the University of Waterloo, she has over 15 years of business, marketing, and engineering experience in the financial technology, banking, education, energy and retail industries. She has worked in top organizations like TD Bank, Trading Pursuits, Petro-Canada, and the TTC. Her passion for personal finance, investing, education, and business strategy brought her to Ratehub.ca where she heads a very talented, cross-functional team that is dedicated to providing Canadians with the best mortgage experience all the way through from online search to (keys-in-your-hand) funded mortgage.

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