August 26th, 2025 Mortgage Industry Update
The Bank of Canada announced on July 30th that its overnight rate will hold at 2.75%. Marks third pause after 7 consecutive rate cuts. With still high uncertainty, the Canadian economy showing some resilience, and ongoing pressures on underlying inflation, BoC decided to hold. The prime rate remains 4.95%.
Additionally this week:
– Statistics Canada: National annual inflation rate fell last month, hitting 1.7%. Cooled from a 1.9% reading in June thanks mainly to a big drop in prices at the pump as gasoline costs slid by 16.1% year over year.
– Equifax Canada report: 1.4 million Canadians missed a credit payment in the second quarter. While that’s up by 118,000 compared with the same time last year, it’s down slightly from the first quarter.
– Condo prices are still on the way down in Toronto, sliding by 9.3% across the city and its outskirts last month compared with the same time in 2024. Year to date, condo sales have plunged by 18%. 17,117 condos were scheduled for completion during the second half of this year.
– HOOPP: 62% of adults view homeownership as central to their long-term security, with nearly half of unretired homeowners (44%) planning to sell their home to fund retirement. 65% of homeowners with a mortgage now worry they won’t be able to pay it off before retirement.
– CREA: Home sales (40,228) increased for the fourth month in a row across Canada in July. Were up by 3.8% monthly. Jumped by 6.6% yearly. Home prices remained largely steady over the summer but slipped by 3.4% yearly. New listings down by 2.9% last month compared with June.
– Wahi: Most millennials (54%) and a substantial share of Gen Z respondents (41%) have felt pressure to buy a home at some point. Far higher than national average of 34%, particularly in comparison with Gen X (30%) and baby boomers (13%), who hold the highest homeownership rates.
– TransUnion: Canada’s credit market is showing signs of recovery with mortgage originations jumping 51% yearly in Q1. Total Canadian consumer credit balances reached $2.52 trillion in Q2, up 4.4%. The average new mortgage loan amount climbed 6.9% year-over-year to $368,432.
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.
