May 20th, 2025 Mortgage Industry Update
The Bank of Canada announced on April 16th that its overnight rate will hold at 2.75%. Marks the first pause after seven consecutive rate cuts. The major shift in direction of US trade policy and the unpredictability of tariffs have increased uncertainty and diminished prospects for economic growth. The prime rate remains 4.95%.
Additionally this week:
– Commercial real estate investment in the Greater Toronto Area rose to $3.1 billion in the first quarter of 2025, a 26% increase compared with the same period in 2024, according to Avison Young’s latest investment report. Industrial assets led all property types.
– Sales of condo units in the city centre 416 region tumbled by 29.9% in April compared with the same time in 2024, according to the Toronto Regional Real Estate Board, while the 905 region surrounding Toronto registered a 31.5% sales slide year over year.
– Liv Rent’s April market report: The average cost of a one bedroom apartment downtown Toronto is $2,224 — nearly $400 dollars less than the last rent peak in October 2023, when the average price was $2,600.
– Statistics Canada: National unemployment rose to 6.9% last month, up from 6.7% in March, as election-related hiring heavily skewed labour market figures and helped add 7,400 jobs. More than 30,000 jobs in manufacturing were shed as the automotive sector buckled under tariffs.
– Urbanation: National average asking rent in April was down yearly for the seventh straight month at $2,127, a decrease of 2.8%. However, monthly increase was 0.4%, reaching a five-month high. Average asking rents in Canada are still 6.2% higher than they were two years ago.
– BMO: The market’s current slump won’t last forever. But falling prices and milder competition mean the present market offers “the best time to buy since the early 1990s,” especially in Toronto.
– RAM Development Group: 81% of Canadians now prefer to keep their real estate investments at home rather than the US, 34% indicating change is likely permanent. Canadian purchases have been declining at avg rate of 14.5% annually between 2019-2024 hitting lowest point in 15 years.
Stay tuned for the next update!
For any questions and concerns please do not hesitate to call Harpreet Singh The Mortgage King at (416) 795-1919.
