January 20th, 2026 Mortgage Industry Update
The Bank of Canada announced on December 10th that its overnight rate will remain at 2.25%. The Bank expects final domestic demand will grow in Q4, but with an anticipated decline in net exports. Overall growth is forecast to pick up in 2026, although uncertainty remains high. The prime rate remains 4.45%.
Additionally this week:
– According to the latest MNP Consumer Debt Index, conducted quarterly by Ipsos, 71% of respondents expect the cost of living to worsen this year, while 59% anticipates a weaker economy and the same share foresees deteriorating housing affordability.
– Neo Financial survey: 46% of respondents said it is more difficult to build credit than it has been for their parents, and 36% believes the rules for accessing credit are deliberately unclear. Only 51% said the credit system works fairly for them.
– Statistics Canada: The economy added just 8,200 jobs in December, even as the unemployment rate climbed to 6.8% from 6.5% the previous month. Full-time employment rose by 50,200 positions while part-time work fell by 42,000.
– TRREB: Toronto’s condo market ended 2025 markedly weaker than it began. Condo apartment sales for the year totalled 16,425, down roughly 14.7% from 2024, while the average price fell about 5.1% to $667,235.
– CBRE: National vacancy rate of offices was 18 per cent at the end of 2025, down from 18.7 per cent a year earlier. Downtown core of Toronto saw an almost 3% drop in vacancy rates. Expects vacancy rates to continue to drop over time and says more workers will return to offices.
– Wahi: December capped off a banner year for buyer-friendly conditions in GTA housing market, with 98% of neighbourhoods with at least 5 home sales seeing prices bid below asking. Remaining 2% (4 of 240 total neighbourhoods) with five transactions were in overbidding territory.
– HouseSigma: Greater Toronto Area home sellers in 2025 faced the weakest resale market in a generation, with only 53% of newly listed homes changing hands. Almost half of the unique properties brought to market either expired, were terminated or remained unsold by year‑end.
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.
