July 29th, 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:
– Statistics Canada: New home prices continued to slide in June, with the national New Housing Price Index falling 0.2% month-over-month. Marks third consecutive monthly decline. 12/27 metropolitan areas surveyed posted price drops, while prices were flat in 10 and rose in just 5.
– Canadian National Multifamily Report by Yardi: National vacancy rate climbed to 4.1%, marking its highest level since 2020. Major urban centres such as Toronto (4.2%) saw the most significant increases in available units. National in-place rents up by $14 to reach $1,720 in Q2.
– CREA: Home prices in Ontario and BC are down 2.9% and 2.4%, respectively, and sales are expected to slip further in 2025. Forecasts both provinces will rebound by 2026, with prices snapping back to 2024 levels. This could be last chance for buyers to catch the market off-balance.
– National survey from Mortgage Professionals Canada: Among Canadians who bought a home in last two years, 70% said they couldn’t have done so without outside help for their down payment. Even among all borrowers who received such help, 58% said they couldn’t have bought without it.
– Bank of Canada report: Most mortgage holders renewing their mortgages in 2025 or 2026 are likely to see an increase in their monthly payments. Most hold a five-year fixed-rate mortgage and could see their monthly payments increase by 15-20%.
– Latest Royal LePage House Price Survey and Market Forecast now expects a 3.5% increase in the national home price by the end of Q4, slightly below its original estimate. Reflecting weaker-than-expected activity in high-priced regions like Toronto and Vancouver.
– Sotheby’s International Realty Canada: Sales of ultra-luxury homes worth more than $10M in the GTA are up 200% for the first half of this year compared to last year. Sales of $4M+ homes were down 28% year over year, while sales of $1M+ homes fell 23%.
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.
