Mortgage Minute – June 27, 2025
This week, the Toronto condo market continued its shift into clear buyer’s territory¹, while on the national level, a softening economy created a big dilemma for the Bank of Canada².
Here’s a breakdown:
The Economy Softens, But the Bank of Canada Hesitates
The latest data shows Canada’s economy shrank slightly in April². While this normally points to a rate cut, the Bank of Canada faces a dilemma: a stubborn category of “core” inflation remains elevated, making the Bank hesitant to cut rates again soon¹,².
Toronto’s Condo Market Becomes a ‘Textbook’ Buyer’s Market
Here in Toronto, the story is all about the condo market. A new report highlights a year-over-year price drop of 6.4%, followed by a 25.1% plunge in sales in May¹. With a flood of listings, sellers are being forced to make “steep cuts” to their asking prices, creating significant challenges for “move-up buyers” who need to sell their condo before purchasing their next home¹.
Housing Remains a Cornerstone of the Economy
Despite market fluctuations, it’s important to see the bigger picture. A new report confirms housing construction remains an economic powerhouse, supporting over 1.2 million jobs and contributing $143.4 billion to Canada’s GDP last year³. This highlights that investing in real estate means participating in a fundamental pillar of the Canadian economy, with housing assets accounting for 25% of all national wealth³.
My Take
This week’s news shows the difference between the short-term headlines and the long-term fundamentals. The Bank of Canada’s hesitation shows that rates may not change quickly, but the local condo market is presenting a clear, short-term opportunity for savvy buyers. My advice is to look past the noise, understand the real opportunity , and build a strategy based on the market’s long-term strength.
Sources:
¹ Canadian Press via Canadian Mortgage Trends, June 16, 2025
² Canadian Mortgage Trends, June 20, 2025 (CREA data)
³ Canadian Mortgage Trends, June 2025 national lender survey
⁴ CMHC report summary via Canadian Mortgage Trends, June 20, 2025