🍁 The Rate Cut That Wasn’t: Why the BoC Sat Still
Let’s start with the elephant in the room — interest rates.
Many economists almost foresaw that the Bank of Canada would not cut its key policy rate in June. That alone has thrown a wrench into many mortgage strategies, particularly for those hoping to see variable rates plunge.
Markets now see just one more cut in 2025, likely in September, putting the floor for mortgage rates somewhere around high-3% territory.
So, if you’ve been waiting for sub-3% rates to come roaring back, it might be time to adjust expectations.
Bottom line:
We’re closer to the low point for mortgage rates than most think. If you're rate-watching, this could be the plateau.
📞 Curious about whether you should lock in now or ride the variable wave? Book a call, and let’s run the numbers together.
📉 Toronto: Price Illusions and an Inventory Explosion
Depending on your media outlet of choice, Toronto prices either "dropped" or "ticked up." Here's the truth:
Seasonally adjusted resale prices rose 0.3% month-over-month, but don’t let that fool you.
MLS HPI saw a slight gain, but only after a major downward revision to previous years — we’ve now seen a 22.7% drop from the peak, not 19% as previously thought.
What’s really happening?
Inventory has surged to the highest levels since the 1990s, with over 30,000 homes for sale — up 42% year-over-year.
Months of inventory and sales-to-new-listings ratio are screaming “buyer’s market.”
So while prices might show a slight monthly lift, the fundamentals point to continued softness ahead, especially with growing court-ordered sales and vacant listings (over 14,000 in May) weighing on prices.
🔍 Where’s the Good News?
Sales were up 8.4% from April, suggesting some thaw in demand. But it’s still the second-lowest May on record in 25 years.
So while Toronto isn't crashing, it’s definitely resetting.
👋 If you're a seller thinking of jumping back in, let’s talk about how to price strategically in this volatile environment.
🌧 Vancouver: Holding Pattern with a Side of Anxiety
Vancouver’s market isn’t faring much better:
Home sales fell 6.5% in May, and are down 18.5% year-over-year.
The MLS HPI fell for the 5th straight month, down 0.9% m/m.
Total inventory rose 25%, and MOI (Months of Inventory) hit 7.7, a Financial Crisis-level number.
And here’s the kicker:
Luxury detached home sales on the Westside — often a proxy for international capital — are down 70% from the 2015-16 highs. Yikes.
Still, Vancouver has some breathing room:
Unemployment is at 6.6%, under the national average.
Most of the new supply is in rental units, not single-family homes. That means the detached market may tighten by 2026.
📞 If you're considering buying into Vancouver's eventual upswing, timing is everything. Let's discuss your financing strategy before the recovery takes off.
🦬 Alberta: A Tale of Two Cities
Here’s where things get more interesting.
🟠 Calgary: Correction Mode
Prices slid just over 1% in May, and are now negative year-over-year.
Inventory is up nearly 100% YoY.
Over 25,000 units are under construction, including 10,000 rental units — the highest ever.
This is not 2015 all over again. Think of it as a mid-cycle correction.
🔵 Edmonton: Resilient and Rising
Inventory jumped in May but remains manageable.
Prices are still seeing double-digit annual gains.
Construction levels are still not meeting demand, signaling strength ahead.
🚦 Alberta remains a bright spot overall with:
Low taxes
Strong population growth
Affordable housing
Ongoing economic diversification
📞 Whether you're an investor or a family looking to relocate, Alberta may offer the best value in Canada right now. Let’s chat if you’re thinking westward.
📊 Final Word: Canada’s Market is on the Cusp — But of What?
The macroeconomic signals are mixed:
Labour market data is split, with household surveys showing job gains and payroll data showing losses.
Inflation pressures are cooling — but government spending may reheat them.
Mortgage delinquency is grinding higher in the GTA, adding stress to over-leveraged homeowners.
But here’s what matters:
The worst may be behind us in Ontario.
Alberta’s still a buyer’s bet.
Vancouver is on a long fuse — but it will ignite.
And all of this points to one thing: you need a strategy.
🧠 Don’t Wait for “Certainty” — It May Never Come
Markets don't ring a bell at the bottom. Whether you’re:
Debating fixed vs. variable
Eyeing an investment property
Or wondering if it's the right time to refinance…
📞 Book a call with me today. We’ll tailor a plan for your goals, not the headlines.
Let’s make sense of this market together — and make your move when it counts.
This article is based on insights and data from Edge Realty Analytics' excellent June 2025 Metro Deep-Dive report, which continues to offer some of the sharpest housing market commentary in Canada.
