June 17th, 2025 Mortgage Industry Update
The Bank of Canada announced on June 4th that its overnight rate will hold at 2.75%. Marks second pause after 7 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:
– CMHC: Condo resale prices have slipped 13.4% in Toronto and 2.7% in Vancouver since 2022. In Toronto, 55% of pre-construction units remained unsold in Q1 2025—just shy of the record 56% seen in late 2024.
– Canada recorded 10% increase in insolvency filings in April compared to previous month. Latest data from Economic Development Canada show that both consumer and business insolvencies contributed to the rise, with total filings reaching 11,950, up from 10,864 in March.
– Urbanation: National average asking rent in May was down 3.3% from a year earlier at $2,129, marking the eighth consecutive month of year-over-year decreases. Held steady from April though, with a 0.1% month-over-month increase.
– TransUnion: Canada’s total consumer debt hit $2.5 trillion in Q1, with growth fuelled by a 30.6% yearly increase in outstanding credit balances among Gen Z consumers. Meanwhile, newcomers to Canada accounted for $2.6 billion in new credit balances, at a 6.3% yearly increase.
– Wahi: Home prices were bid down in 87% of GTA neighbourhoods, up from 84% in April. In the remaining 13% of neighbourhoods, sale prices surpassed list prices. A year ago 60% of neighbourhoods were in underbidding territory, 36% were overbid, and 4% were selling at asking.
– The 2025 Global Cities Index from Oxford Economics finds that as a result of Toronto’s expensive real estate market, residents “spend more of their income on housing than residents of nearly every other city in the world.”
– Statistics Canada: National unemployment rate rose to 7% in May, highest level since 2016 outside of pandemic years, as job growth remained virtually flat. Just 8,800 jobs were added. Gains in full-time work (up 58k positions) were nearly wiped out by loss of 49k part-time jobs.
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.
