September 2nd, 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:
– The Bank of Canada won’t change its 2% target for inflation next year, governor Tiff Macklem said, confirming that the longstanding goal will remain in place for the foreseeable future.
– Statistics Canada: Number of Canadians commuting to work rose for the fourth consecutive year. The data shows a continuing decline in remote work, with the proportion of employed people primarily working from home falling to 17.4% in May 2025, down from 18.7% a year earlier.
– SingleKey: Average credit score among renters is above mortgage lending threshold set by major banks but lower than the average mortgage holder’s score. Average renters had a credit score of 694 – higher than banking giants’ limit of 680 and below average homeowner score of 764.
– Financial Accountability Office of Ontario: Ontario shed 38,000 jobs in Q2 2025. Unemployment rate climbed to 7.8%, marking the ninth consecutive quarterly increase and the highest level since 2012, excluding the pandemic. That is up from a low of 5.2% recorded in early 2023.
– FSRA: Overall mortgage activity saw slight growth in 2024, with total number of mortgages in province increasing to 414,082 and the dollar value reaching $256.0 billion. This increase was driven by a 1% rise in traditional mortgages, which offset a 1% drop in private mortgages.
– The Harris Poll Canada, shows that Canadians remain split on expectations for interest rates, despite the Bank of Canada keeping rates steady in recent months. About 32% of respondents expect rates to rise, 27% anticipate a decline, and 29% believe rates will stay unchanged.
– SingleKey: National average rent is $2,200 per month. Highest in Vancouver ($3,095) and Toronto ($2,899). Lowest in Montreal ($1,520). Renters nationally spend 37.6% of income on housing, nearing the “crisis” threshold of 40%. Toronto renters already exceed it at 41.1%.
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.
