Oct 8th, 2026 Mortgage Industry Update
The Bank of Canada announced on September 2nd that its overnight rate will remain at 2.25%. Uncertainty remains high and new US tariffs and threats of further action pose continued risks. The war in the Middle East remains a strong concern as well. The prime rate remains 4.45%.
Additionally this week:
– Some 72% of rental developer respondents to 2026 Rental Housing Development Study, prepared by EY for CMHC, said they had paused or cancelled pipeline projects because development costs rose over past 2-3 years. Only 37% were optimistic about rental feasibility over next 5 years.
– Wahi: Homes across GTA are now taking 3x-4x as long to sell compared to Q1 2022 market peak, and the segment taking the hardest hit is condos. Quarterly average days on market between 2020 and Q2 2026 shows average 36 days to find a buyer in Q2 2026, up from 32 days during 2025.
– Equifax Canada says consumer debt in Canada has now reached $2.68 trillion, with outstanding mortgage balances sitting at $1.97 trillion – an increase of about 4% from the previous year, mainly due to higher renewal activity.
– TD Economics: The Provincial Resale Market Outlook projects national home sales will fall 5.3% this year. That is far steeper than the 1.8% decline projected earlier in 2026. Average home prices are expected to finish the year roughly flat, up 0.1%, before rising 1.7% in 2027.
– RBC: Canada’s housing affordability cycle has hit a wall. RBC’s national housing affordability measure improved by just 0.4 of a percentage point in Q2, its smallest quarterly gain in nearly a year, settling at 52.8%. Toronto posted Q2’s largest improvement among major cities.
– Canada’s economy ground to a halt in July 2025, with Statistics Canada reporting gross domestic product growth of 0%. That’s a sharp pullback from the 3.3% annualized pace recorded in the second quarter. The flat result arrived as new American import restrictions took effect.
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.
