this is true but it doesn’t mean there isn’t a notable difference between the average household mortgage rate north and south of the border. i’m confused about daily libor. since 2/3rds of Canadians have 5-yrs, it’s basically linked to GofC 5-years, no? only a small portion of the market has variable and those people are enjoying 2.5% spreads vs. the typical U.S. mortgageholder right now.
Yes, the daily LIBOR (really CDOR) is more or less the variable, just smoothed out by the arbitrary “prime rate.” Still you can’t say one thing is cheaper when really it is just more risky.
it’s still cheaper and will be cheaper for the life of the loan if rates don’t rise markedly. seeing as the average paydown term is 17 years, if you average 2.5% for 5 years in Canada, the next 12 would have to average about 4.3% (say 3.8% variable and 4.6% 5 year fixed) to match U.S. rates over that time period. i can easily say it’s cheaper for at least 5 years, which is as good a statement as you can get.
since cost of living is a year-by-year calculation, you shouldn’t include grand hypotheses about future house price growth and mortgage rates far down the line in making the comparison. if mortgage rates change markedly and it makes the U.S. much more attractive, move, if not, stay in Canada. simple as that. hell, tax rates can change dramatically every 4 years in either jurisdiction so trying to look past 5 years would be crazy.