September 9th, 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: GDP down by 1.6% year over year in the second quarter, slightly more than the central bank had expected, as exports fell amid the ongoing trade war. Marks first GDP contraction in nearly two years.
– BILD: New home sales in GTA remain “exceedingly low,” with July seeing lowest levels in decades. Down 48% annually. New home sales for a typical July in the GTA would be 1,941 units based in the previous 10-year average. But only 359 homes were sold in July 2025.
– Avison Young: Investment in GTA’s commercial real estate market slowed significantly in Q2 2025, with total investment volume dropping 36% annually. Total volume was $2.7 billion, down from $4.3 billion. While dollar volume declined, number of transactions increased 14% quarterly.
– Third quarter data from Statistics Canada’s Canadian Survey on Business Conditions said 42% of businesses didn’t pass along tariff-related cost increases to their costumers in past six months. A quarter of firms said they did charge more because of tariffs.
– Royal LePage: 54% of Canadians with US property are thinking about selling it within next year, with 62% citing the current political administration as their main reason. Other factors include personal and financial reasons (33%) and increasingly extreme weather conditions (5%).
– National NBF analysis shows that over 1 in 5 listings (22.5%) were canceled in July. Share has been steadily climbing since 2023, and while it has yet to print a record, it’s now approaching previous extremes. Sellers have been canceling their listings at an unusually high rate.
– PBO: While Canada is on track to build 2.5 million new homes by 2035, it will not be nearly enough to close the housing gap and meet demand. Will still be 690,000 homes short of the 3.2 million new homes that Canada would need to meet its housing demand over next 10 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.
