London Mortgages

03/18/2026

The Bank of Canada today held its target for the overnight rate at 2.25%, with the Bank Rate at 2.5% and the deposit rate at 2.20%.

The war in the Middle East has increased volatility in global energy prices and financial markets, and heightened the risks to the global economy. The breadth and duration of the conflict, and hence its economic impacts, are highly uncertain.

Prior to the war, the global economy was on pace to grow at around 3%, as expected in the January Monetary Policy Report (MPR). Economic growth in the United States has moderated but remains solid, driven by consumption and strong AI-related investment. US inflation remains above target and has evolved largely as expected. In the euro area, domestic demand is supporting growth while exports have contracted. China’s economy continues to be boosted by strength in exports, but domestic demand remains weak.

Since the outbreak of the conflict in the Middle East, global oil and natural gas prices have risen sharply, and this will boost global inflation in the near-term. In addition to energy supply disruptions, transportation bottlenecks stemming from the effective closure of the Strait of Hormuz could impact the supply of other commodities, such as fertilizer. Financial conditions have tightened from accommodative levels. Global bond yields have risen, equity market prices have declined, and credit spreads have widened. The Canada-US dollar exchange rate has remained relatively stable.

After expanding by 2.4% in the third quarter of last year, GDP in Canada contracted 0.6% in the fourth quarter. This was weaker than expected at the time of the January MPR, but mainly because of a larger-than-expected drawdown in inventories. Domestic demand grew by more than 2% due to strength in consumer and government spending, even as housing markets remained weak.

We continue to expect the Canadian economy to grow modestly as it adjusts to US tariffs and trade policy uncertainty, but recent data suggest that near-term economic growth will be weaker than anticipated in January. The labour market remains soft. Employment gains in the fourth quarter of 2025 were largely reversed in the first two months of 2026, and the unemployment rate rose to 6.7% in February. Looking through the volatility, recent data also suggest ongoing weakness in exports. It’s too early to assess the impact of the conflict in the Middle East on growth in Canada.

CPI inflation eased further to 1.8% in February, down from 2.3% in January. CPI inflation excluding changes in indirect taxes as well as core inflation measures have also come down and are all close to 2%. Food inflation slowed in February but remains elevated. The sharp increase in global energy prices has led to increases in gasoline prices, and this will push up total inflation in the coming months.

Against this overall backdrop, Governing Council decided to maintain the policy rate at 2.25%. With recent data pointing to weaker economic activity and uncertainty elevated, risks to growth look tilted to the downside. At the same time, inflation risks have gone up due to higher energy prices. We will continue to assess the impact of US tariffs and trade policy uncertainty, and how the Canadian economy is adjusting. We are also monitoring the unfolding conflict in the Middle East closely and assessing its impact on growth and inflation. As the outlook evolves, we stand ready to respond as needed. The Bank is committed to ensuring that Canadians continue to have confidence in price stability through this period of global upheaval.

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12/24/2025

Canada’s economy contracted more sharply than expected in October, a setback that appeared to have strengthened the case for the Bank of Canada to keep interest rates steady at its next decision rather than move toward the hike markets have been eyeing for 2026.

Statistics Canada reported that real gross domestic product fell 0.3% in October, erasing September’s 0.2% gain and marking the largest monthly drop in almost three years.

Both goods‑ and services‑producing industries pulled back. Goods output declined 0.7%, while services edged down 0.2%.

Manufacturing led the slide with a 1.5% drop, including a 6.9% plunge in machinery output and a 7.3% fall in wood product manufacturing after new United States lumber tariffs took effect on October 14.

Postal and education services were also hit by nationwide Canada Post stoppages and an Alberta teachers’ strike.

StatCan’s flash estimate showed GDP growing 0.1% in November, suggesting the downturn has not yet morphed into a technical recession, but the run of weak data places the central bank in a tighter corner.

Governor Tiff Macklem already warned that he expected “GDP growth to be weak in the fourth quarter” and described the economy as “resilient overall” but facing “elevated uncertainty” from US tariffs and global trade tensions.

Market pricing before the report has pointed to the Bank’s next move being a 25‑basis‑point hike, most likely in July 2026. That call now looks less assured.

For mortgage professionals, the question is whether softer growth would force the Bank to pivot sooner than markets have assumed.

October’s GDP setback appears less like a one‑off and more like another data point pushing policymakers toward a longer hold, and eventually, a cautious easing path, rather than a return to tightening.

For lenders and brokers already navigating thinner volumes and more conservative underwriting, the next Bank of Canada move looks further away, but the direction, once it came, is now more likely down than up.

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09/22/2025

Bank of Canada rate drop - what is the good news and what is the bad news?
The good news is that variable rate mortgages, lines of credit, and any debt that is based on prime is now less expensive to service. Additionally, the BOC rarely has one rate drop at a time so we are poised for another 1/4% reduction.
The challenge is our high unemployment numbers and inflation numbers adding back the stripped out items, is higher than teh 1.9% reporting. None of us walk into the grocery store and think inflation is under control. My reading suggests that food costs are up 27% in just 4 years!!
We continue to watch the money markets and are always available to answer questions. Call, text for quickest response - messenger is OK as well - just a longer response time.
David

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09/08/2025

Bonds are down considerably. To me, this means a couple of things
1. The BOC will drop prime in September, or worst case Oct
2. Fixed rates should come down slightly
Bets wishes all
David

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07/15/2025

Fixed rate increases are imminent. For those of yo who do not have rate holds / pre-approvals, please reach out asap.
The bond today, is over $3.12 - this can amount to a 15 to 30 point rate hike

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04/06/2025

For those that have any credit challenges, unmanageable debt, or just questions, we have added a link to a website that you may find helpful.

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04/04/2025

OTTAWA — March saw the Canadian economy post its biggest job loss since January 2022 as the uncertainty caused by U.S. tariffs started to take a toll.

Statistics Canada said Friday the economy shed 33,000 jobs in March, while the unemployment rate ticked up to 6.7 per cent compared with 6.6 per cent in February.

RSM Canada economist Tu Nguyen said the result was a glimpse of what may be in store as the trade dispute with the U.S. ramps up and the country faces the possibility of a recession.

"We saw a lot of layoffs happening in trade in March and we expect April to see even more layoffs and a rise in the unemployment rate," she said in an interview.

"Some manufacturing plants, especially in auto production, have already laid off their workers."

The job losses reversed some of the gains made at the end of last year and into January.

Last month, the U.S. imposed tariffs on non-USMCA compliant imports from Canada as well as steel and aluminum imports as tariff threats by U.S. President Donald Trump went through a number of revisions and delays, heaping uncertainty onto businesses.

The U.S. also announced last month sector-specific tariffs on automobile imports that came into effect this week along with wide-ranging tariffs on other countries around the world, prompting concerns about the possibility of a global recession.
Nguyen said Canadian job losses will continue to rack up if the tariffs remain in place, pointing to the decision by Stellantis to pause work for two weeks at its assembly plant in Windsor, Ont., as it assesses the situation as an example of what may be to come.

"The auto sector is so integrated in North America that once you hit one country, you're going to hit everybody," she said.

RBC senior economist Claire Fan said the March jobs report was slightly softer than the bank expected, but the concern is that there is still further weakness to come.

"Moreover, broader U.S. growth risks from much larger tariffs threatened to be imposed on imports from most of the rest of the world would spill over to negatively impact Canada as well," she wrote.

Fan noted Canada lost around 7,000 manufacturing jobs in March.

"Employment in the sector will be watched closely in future jobs reports, for signs of tariffs impacting labour conditions in Canada," she said.

Nguyen said the Bank of Canada is in a difficult position because there is still some underlying inflation.

"But given how weak the March jobs report is and given we are foreseeing a recession given the current tariff rate, I think the Bank of Canada might consider lowering the interest rate to 2.5 per cent," she said.

The current benchmark rate is 2.75 per cent after seven consecutive cuts.

The Bank of Canada's next interest rate decision is set for April 16 when it will also release its latest monetary policy report which will include its updated forecasts for the economy.

Statistics Canada reported 62,000 full-time jobs were lost in the month, partly offset by a gain in part-time employment.

The wholesale and retail trade sector lost 29,000 jobs in March, following an increase of 51,000 in February.

The information, culture and recreation sector lost 20,000 jobs, while the agriculture sector lost 9,300 jobs.

Meanwhile, the “other services” sector, which includes personal and repair services, added 12,000 jobs. Utilities added 4,200 jobs.

Total hours worked were up 0.4 per cent in March, following a drop of 1.3 per cent in February.

Average hourly wages among employees rose 3.6 per cent on a year-over-year basis in March.

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10/23/2024

BOC has dropped .50%

Bank of Canada reduces policy rate by 50 basis points to 3¾%
The Bank of Canada today reduced its target for the overnight rate to 3¾%, with the Bank Rate at 4% and the deposit rate at 3¾%. The Bank is continuing its policy of balance sheet normalization.
The Bank continues to expect the global economy to expand at a rate of about 3% over the next two years. Growth in the United States is now expected to be stronger than previously forecast while the outlook for China remains subdued. Growth in the euro area has been soft but should recover modestly next year. Inflation in advanced economies has declined in recent months, and is now around central bank targets. Global financial conditions have eased since July, in part because of market expectations of lower policy interest rates. Global oil prices are about $10 lower than assumed in the July Monetary Policy Report (MPR).
In Canada, the economy grew at around 2% in the first half of the year and we expect growth of 1¾% in the second half. Consumption has continued to grow but is declining on a per person basis. Exports have been boosted by the opening of the Trans Mountain Expansion pipeline. The labour market remains soft—the unemployment rate was at 6.5% in September. Population growth has continued to expand the labour force while hiring has been modest. This has particularly affected young people and newcomers to Canada. Wage growth remains elevated relative to productivity growth. Overall, the economy continues to be in excess supply.
GDP growth is forecast to strengthen gradually over the projection horizon, supported by lower interest rates. This forecast largely reflects the net effect of a gradual pick up in consumer spending per person and slower population growth. Residential investment growth is also projected to rise as strong demand for housing lifts sales and spending on renovations. Business investment is expected to strengthen as demand picks up, and exports should remain strong, supported by robust demand from the United States.
Overall, the Bank forecasts GDP growth of 1.2% in 2024, 2.1% in 2025, and 2.3% in 2026. As the economy strengthens, excess supply is gradually absorbed.
CPI inflation has declined significantly from 2.7% in June to 1.6% in September. Inflation in shelter costs remains elevated but has begun to ease. Excess supply elsewhere in the economy has reduced inflation in the prices of many goods and services. The drop in global oil prices has led to lower gasoline prices. These factors have all combined to bring inflation down. The Bank’s preferred measures of core inflation are now below 2½%. With inflationary pressures no longer broad-based, business and consumer inflation expectations have largely normalized.
The Bank expects inflation to remain close to the target over the projection horizon, with the upward and downward pressures on inflation roughly balancing out. The upward pressure from shelter and other services gradually diminishes, and the downward pressure on inflation recedes as excess supply in the economy is absorbed.
With inflation now back around the 2% target, Governing Council decided to reduce the policy rate by 50 basis points to support economic growth and keep inflation close to the middle of the 1% to 3% range. If the economy evolves broadly in line with our latest forecast, we expect to reduce the policy rate further. However, the timing and pace of further reductions in the policy rate will be guided by incoming information and our assessment of its implications for the inflation outlook. We will take decisions one meeting at a time. The Bank is committed to maintaining price stability for Canadians by keeping inflation close to the 2% target.

10/22/2024

Is Canada ready for a 50-point rate cut? Economists weigh in
Market expectations build around a steep rate cut as inflation slows and economic risks rise

Economists are placing their bets on the Bank of Canada cutting interest rates by 50 basis points, as the central bank prepares to announce its latest interest rate decision on Wednesday.
BoC officials are facing pressure to act as downside risks to the Canadian economy become more apparent.
“Markets have thrown down their 50-basis point chip on the poker table, betting that the Bank of Canada will deliver an interest rate cut of that magnitude,” CIBC chief economist Avery Shenfeld said in a note to clients.
While Shenfeld acknowledged the possibility of a larger 75-bps cut, he believes the central bank is more likely to go with the 50-bps reduction, a move that would signal confidence in economic recovery prospects for 2025.
Inflation has been a key driver of these rate cut predictions. Headline inflation fell to 1.6% in September, down from the Bank of Canada’s 2% target in August. This drop, combined with weaker economic indicators, has led five of the six major Canadian banks to predict a sharper rate cut this month.
“What the economy tells us is that inflation, if anything, is going to slow even more,” said RBC economist Claire Fan, adding that the central bank is likely to highlight the risk of inflation falling below target rather than overshooting it.
Economic growth has also lagged behind expectations. The Bank of Canada’s July monetary policy report predicted gross domestic product (GDP) growth of 2.1% for the third quarter, but early estimates now suggest the figure will be closer to 1%.
“The Bank of Canada had a very high forecast for GDP,” said Beata Caranci, chief economist at TD Bank. “I don’t think anyone had forecasted as high… when they came out with that number.”
While September’s unemployment rate dipped slightly to 6.5%, it remains nearly a percentage point higher than the same time last year. Governor Tiff Macklem indicated last month that the central bank could consider faster rate cuts if growth continues to lag behind expectations. However, TD Bank remained cautious, predicting a smaller 25-bps cut.
“There is not a compelling case that they need to accelerate rate cuts at this stage,” Caranci explained. “Whether you get there six weeks early or not, is not as important as the signal you send to households and markets by doing an almost emergency-style cut when there is no fire to put out.”
She added that the absence of a serious rise in delinquency rates, along with concerns about reigniting housing market activity, support a more gradual approach.
Economists at the National Bank of Canada are among those calling for a steeper cut, predicting a 50-bps reduction not only this month but also at the Bank’s next meeting in December.
“To be sure, the Bank of Canada will still acknowledge some upside risks but expect more emphasis on the downside,” wrote National Bank economists Taylor Schleich and Warren Lovely. “This is why we argue that, at a minimum, the Bank of Canada will/should quickly get back to a more neutral policy stance, entailing a 50-basis-point cut on Wednesday and (another) in December.”

10/02/2024

Some clarification about the new mortgage rules.
1. The 30 year amortization is available provided at least on person on title is a 1st time buyer.
2. This is available to submissions after the 15th of December. Lender's may resubmit a current application after Dec 15th, provided it is prior to closing
3. The insurance premium is surcharged by .20% making the high ratio insurance premium more as well as the tax on that premium
I hope this clarifies some of the questions you may have

09/25/2024

Here is s snippet from TD's economists - positive news for teh RE market

Last week, TD Economics updated its economic forecasts. With the Bank of Canada firmly in its rate-reduction cycle, the housing market is expected to be strong next year. TD is forecasting a further 200 basis points of cuts: 50 basis points in the fourth quarter of 2024, 125 basis points in 2025 and an additional 25 basis points in the first quarter of 2026, bringing the overnight rate down to 2.25 per cent from the current 4.25 per cent. (There are 100 basis points in a percentage point.)
TD also raised its 2025 home sales and price forecasts for all provinces from its June forecast. In 2025, annual average existing home prices are forecast to rise between 3.6 per cent and 7 per cent across the 10 provinces with the strongest growth expected for the Prairie provinces and the greatest improvement seen in Ontario. Annual average existing home prices are anticipated to expand by 7 per cent in Alberta, 6.2 per cent in Saskatchewan and 6 per cent in Manitoba. In Ontario, the housing market is expected to recover with annual average existing home prices rising 4.6 per cent, up from a decline of 0.4 per cent anticipated in 2024.

09/16/2024

Big news to help young buyers

Finance Minister Chrystia Freeland announced two significant changes to federal mortgage policy Monday, raising the price cap for insured mortgages to $1.5-million, up from $1-million, and expanding eligibility for 30-year mortgage amortizations to all first-time homebuyers.
The government described the announcement as the most significant mortgage reforms in decades. Both changes are to be in place as of Dec. 15.
Raising the insurance threshold to $1.5-million will help first time homebuyers in Vancouver, Toronto and many parts of southern Ontario where the typical home price is more than $1-million.
Mortgage insurance is required in order to purchase a home with a down payment of less than 20 per cent.
Allowing all buyers to get a 30-year amortization may provide a boost for the new condo market, where sales have dropped to multi-year lows. Preconstruction condos used to be a popular investment for mom and pop investors and high-net-worth individuals, but they have fallen out of favour as the cost of purchasing the new condos have soared.
Ms. Freeland made the announcement at a news conference on Parliament Hill, where House of Commons sittings resumed for the first time since June. Concerns over housing affordability and the cost of living more broadly are top of mind for voters and all federal parties are attempting to position themselves as having a plan.
The federal government’s 2024 budget included a change that came into effect on Aug. 1, which allowed 30-year mortgage amortizations for first-time homebuyers purchasing new builds.
Monday’s announcement expands that provision to include all all first-time homebuyers.
Currently the maximum amortization period for insured mortgages in Canada is 25 years.
“The government initially expanded eligibility to first-time home buyers purchasing new builds to incentivize the construction of new homes,” the Finance Department said in a backgrounder document explaining the change.
“Now, given inflation and interest rates have fallen, the government is expanding access to lower monthly mortgage payments to all first-time homebuyers and to all buyers of new builds,” the department said. “This will unlock the dream of homeownership for more first-time buyers, while also further incentivizing the construction of more new homes.”
The department said further details will be released in the coming weeks.
Under existing rules for insured mortgages, a minimum down payment of five per cent is required if the home costs $500,000 or less. If the home costs more than $500,000, the purchaser will need a minimum of five per cent down on the first $500,000 and 10 per cent on the remainder.