Referral Mortgages Inc.

If you have been watching the headlines in 2026, you may be wondering why buying a home in Canada still feels so difficult. On the surface, some of the data sounds encouraging. More homes are being built in parts of the country, the Bank of Canada is no longer in the aggressive rate-hiking phase, and inflation has cooled compared with the worst of the last few years.

So why does homeownership still feel out of reach for many Canadians?

The short answer is this, more supply does not always mean the right supply, and lower inflation does not automatically make homes affordable. Many buyers are still dealing with high home prices, stricter qualification standards, elevated monthly carrying costs, and uncertainty about jobs and household budgets. In other words, the market may be improving in some ways, but that does not mean it feels easy on the ground.

For buyers, renewers, and homeowners thinking about refinancing, this is an important moment to understand what is really happening. The goal is not just to follow headlines, it is to make smart mortgage decisions based on how the market is affecting your real monthly costs.

More homes are being built, but that does not solve everything

One of the biggest reasons affordability still feels strained is that new housing supply is not always matching what buyers need most. In many markets, recent construction strength has been driven by rental housing and smaller multi-unit developments. That matters, and more supply is definitely a good thing for the country overall, but it does not instantly create affordable ownership options for every buyer.

A lot of Canadians looking to buy are not simply asking whether more housing exists. They are asking whether they can find the kind of home they want, in an area they can live in, at a monthly payment they can actually carry. Those are very different questions.

In some expensive markets, there is still a disconnect between what is being built and what average buyers can comfortably afford. In other areas, supply may be increasing, but population growth, borrowing constraints, and household budgets still keep ownership challenging. More units in the system helps over time, but it does not erase years of affordability pressure overnight.

Affordability is about payments, not just prices

One of the biggest mistakes people make is assuming that affordability improves only when home prices drop. In reality, affordability is just as much about monthly payments as it is about sticker price.

Even if a home price is stable, the cost of owning that property may still feel heavy once you add up the mortgage payment, property taxes, heating costs, insurance, condo fees where applicable, and the general cost of living. That is especially true for buyers who entered the market later and are qualifying at higher rates than borrowers did a few years ago.

This is where the mortgage side of the conversation becomes so important. A buyer may see a home listed at a price that seems manageable, but once the stress test, today's rates, and all monthly obligations are considered, the budget can tighten quickly. That gap between headline price and real-world affordability is a big reason many Canadians still feel stuck.

Lower inflation helps, but it does not instantly restore buying power

Cooling inflation is good news, but it should not be confused with cheap living. When inflation slows, it means prices are rising more slowly, not that prices have gone back to where they were before. Canadian households are still carrying the cumulative impact of several years of higher food, insurance, transportation, and housing-related costs.

That matters for mortgage qualification and for confidence. Even if someone technically qualifies for a mortgage, they may hesitate to buy if they feel stretched in every other area of their finances. Buyers are not just thinking about approval anymore. They are thinking about resilience. Can they still live comfortably after the mortgage payment comes out each month? Can they handle an unexpected bill? Can they still save?

That mindset is shaping the market in 2026. People do not just want to own a home, they want to own one without feeling financially pinned down.

The Bank of Canada is not the only factor that matters

A lot of buyers focus only on the Bank of Canada policy rate, and while it is important, it is not the whole story. Variable-rate mortgages are more directly affected by Bank of Canada moves, but fixed mortgage rates are driven more by bond markets and lender pricing. That means buyers can still feel affordability pressure even during a period when the central bank is holding steady.

This is one reason the market can feel confusing. You may hear that inflation has cooled and the policy rate has held, yet mortgage payments still look high compared with what people were used to earlier in the decade. Add in the stress test and day-to-day living costs, and many households still feel like the math is tight.

For borrowers, this means strategy matters more than ever. The right mortgage is not just about chasing the lowest posted rate. It is about choosing terms, payment structure, prepayment flexibility, and risk tolerance in a way that fits your real life.

Why first-time buyers still feel squeezed

First-time buyers are often hit the hardest because they are dealing with the full cost of entry all at once. They need a down payment, closing costs, legal fees, adjustment costs, and enough financial room to satisfy both lenders and their own comfort level.

Recent federal mortgage rule changes have helped in some situations, especially for buyers who need flexibility on insured mortgage eligibility or longer amortization options on qualifying purchases. But even with those changes, many buyers still run into the same core issue, their incomes have not risen fast enough to fully offset how expensive ownership became.

That is why more housing starts alone do not immediately translate into easier buying conditions. Supply is part of the answer, but buyer affordability also depends on income growth, financing costs, and confidence in the economy.

Why some homeowners are staying put

Another reason the market can feel slower than expected is that some existing homeowners are choosing not to move. Even if they would like more space, less maintenance, or a different location, many are cautious about giving up an older mortgage rate or taking on a larger payment in today's environment.

When owners stay put longer, that can reduce the flow of resale homes coming onto the market in certain neighbourhoods and price bands. So even if broader housing supply is improving in some parts of the system, the specific homes many buyers want may still be limited.

That creates a market where supply is improving in theory, but choice still feels restricted in practice.

What this means for renewals and refinancing

This conversation is not only relevant for buyers. It also matters for homeowners approaching renewal or thinking about refinancing. If affordability still feels tight nationally, that reflects the same budget reality many renewing borrowers are facing at home.

For renewals, the key question is not simply whether rates are better than they were a year ago. It is whether your new payment will comfortably fit your current household budget. Many borrowers are still coming off older lower-rate terms, so even a more stable 2026 environment can still mean a noticeable payment increase at renewal.

For refinancing, the conversation has to be even more careful. Refinancing can make sense for debt consolidation, cash flow management, renovations, or restructuring higher-cost obligations. But the wrong refinance can also increase long-term borrowing costs if it is done without a clear plan. In today's market, every refinance should be looked at through the lens of both monthly relief and long-term financial impact.

What smart buyers are doing differently in 2026

The strongest buyers in this market are not necessarily the ones chasing headlines. They are the ones building a strategy before they shop. That usually means understanding their true payment comfort zone, not just their maximum approval. It means reviewing the effect of property taxes, insurance, debt payments, and everyday living costs before making an offer. It also means knowing when to wait, when to move, and when to adjust expectations.

In practical terms, smart buyers are often doing a few things well:

• Getting a realistic pre-approval based on full monthly affordability, not just purchase price.
• Comparing fixed and variable options based on risk tolerance, not headlines alone.
• Leaving room in the budget for rising costs and unexpected expenses.
• Looking at different property types or nearby communities where the payment may be more manageable.
• Working with a mortgage professional early, before making assumptions about what is or is not possible.

The bigger takeaway for Canadian homeowners and buyers

Buying still feels hard in 2026 because the housing story is more complex than a single headline. Canada may be adding supply, but affordability is still being shaped by years of high prices, monthly carrying costs, qualification rules, and household budget pressure. A stronger construction picture is helpful, but it is only one piece of what determines whether ownership feels realistic.

The good news is that this is exactly where good mortgage advice matters. In a market like this, the right guidance can help you understand your options clearly, avoid costly mistakes, and choose a strategy that fits both today's market and your longer-term goals.

Whether you are buying your first home, renewing an existing mortgage, or exploring a refinance, the most important step is making decisions based on your actual numbers, not just general market sentiment. That is how you move forward with confidence, even when the market still feels challenging.

FAQs

Why does buying still feel unaffordable if more homes are being built?

Because more supply does not always mean more affordable ownership options right away. In many markets, new construction has been stronger in rental or smaller-unit categories, while many buyers still need homes that fit their budget, family size, and location needs.

Will lower inflation automatically make mortgages more affordable?

Not automatically. Lower inflation helps stabilize the economy, but it does not reverse the higher prices households are already paying for housing and everyday living. Mortgage affordability still depends on rates, income, debt levels, and monthly carrying costs.

Does a Bank of Canada rate hold mean fixed mortgage rates will fall?

Not necessarily. Variable-rate mortgages are more directly affected by the Bank of Canada. Fixed rates are influenced more by bond yields and lender pricing, so they do not always move in step with the policy rate.

How does this affect mortgage renewals in 2026?

Many homeowners renewing in 2026 may still face higher payments than they had on older terms. Even in a more stable rate environment, renewal should be reviewed carefully to make sure the new payment fits your current budget and goals.

Should I wait to buy or get pre-approved now?

That depends on your income, savings, debt levels, and comfort with monthly payments. In many cases, getting pre-approved now is helpful because it gives you a realistic picture of what you can afford and lets you plan from a position of clarity instead of guesswork.

Newly Passed Bill C-4, What It Means for Canadian Mortgages

If you are buying your first home, renewing a mortgage, or thinking about refinancing, newly passed Bill C-4 is worth understanding. It received Royal Assent on March 12, 2026, and includes a new first-time home buyers' GST rebate on qualifying new homes, a middle-class tax cut, and the permanent removal of the federal consumer fuel charge from legislation. For Canadian homeowners, the housing piece is the biggest headline, but the mortgage impact is more nuanced than many people may expect.

The most important thing to know is this: Bill C-4 does not directly lower mortgage rates. It does not change how lenders price fixed or variable mortgages, and it does not create a special renewal or refinance program. What it does do is lower some up-front housing costs for eligible first-time buyers of qualifying new homes, while also improving monthly cash flow for some households through lower income taxes. That means it can improve affordability for some Canadians, but it is not a blanket solution for everyone in the market.

What Bill C-4 Actually Does

Under Bill C-4, the federal government created a first-time home buyers' GST rebate for qualifying new homes. In plain language, that means eligible first-time buyers can recover up to 100% of the GST, or the federal part of the HST, on a new home priced up to $1 million. For homes priced between $1 million and $1.5 million, the rebate is reduced on a sliding scale. A home priced at $1.25 million, for example, is eligible for a 50% rebate, which is up to $25,000. No rebate is available at or above $1.5 million.

The maximum savings can reach $50,000. The measure applies to qualifying agreements entered into on or after March 20, 2025, before 2031, with construction completion deadlines that extend to before 2036. The CRA has already opened the program and notes that it is updating filing systems for some early applications tied to agreements signed between March 20, 2025, and May 26, 2025.

To qualify as a first-time home buyer for this rebate, an individual generally must be at least 18, be a Canadian citizen or permanent resident, and must not have lived in a home they owned, or that their spouse or common-law partner owned, in the calendar year or the previous four calendar years. The home also needs to be intended as a primary residence. The rebate can apply to a new home purchased from a builder, an owner-built home, or certain co-op housing purchases.

How Bill C-4 May Affect Mortgage Rates

For borrowers, this is where expectations need to stay realistic. Bill C-4 does not set mortgage rates. In Canada, variable-rate mortgages are influenced more directly by the Bank of Canada's policy rate, while fixed rates are shaped largely by bond market conditions and lender pricing. As of March 18, 2026, the Bank of Canada held its policy rate at 2.25%, which reinforces the point that mortgage pricing is still being driven by monetary policy and financial markets, not by Bill C-4 itself.

So if you are wondering whether this bill means mortgage rates will immediately fall, the honest answer is no. There is no automatic rate cut built into this legislation. However, the bill could still influence buying activity at the margin, especially in new construction, because reducing GST can materially improve affordability for first-time buyers. If more demand flows into qualifying new homes, that may support sales activity in some markets, but it is still very different from a rate change.

What It Means for First-Time Home Buyers

This is where Bill C-4 has its clearest mortgage relevance. Mortgage qualification is not just about the interest rate. It is also about down payment, closing costs, debt service ratios, and the total amount you need to complete the purchase. If an eligible buyer saves tens of thousands of dollars in GST on a qualifying new home, that can reduce the total cash required to buy, improve the effective purchase economics, or leave more room in savings after closing.

For some buyers, that could mean the difference between stretching too far and buying more comfortably. It may also make some pre-construction or newly built properties more financially realistic than they were before. That said, this is not universal relief. The rebate is limited to first-time buyers, limited to qualifying new housing, and ends at the $1.5 million threshold. Buyers of resale homes do not get this new rebate under Bill C-4.

There is also a practical mortgage-planning angle here. Just because you may qualify for a larger purchase does not necessarily mean you should take the maximum available amount. A larger mortgage still has to fit your monthly budget, renewal risk, and long-term financial goals. The best use of this measure may be to improve your financial cushion, not simply to buy the most expensive home possible.

What It Means for Mortgage Renewals

If you already own a home and are approaching renewal, Bill C-4 does not create any special renewal discount, new stress test exemption, or lender relief program. Your renewal options will still depend on your lender, your remaining amortization, current market rates, and whether you stay with your current lender or shop the market.

Where Bill C-4 could still matter for renewal households is cash flow. The legislation lowers the lowest federal personal income tax bracket to 14.5% for the 2025 taxation year and 14% for 2026 and later years. The Department of Finance says nearly 22 million Canadians will benefit, with relief of up to $420 per person, or up to $840 for two-income families in 2026. That is not the same as a lower mortgage rate, but for a household facing a higher renewal payment than it had a few years ago, any monthly budget relief can help absorb the payment shock.

In other words, Bill C-4 may help some renewal borrowers indirectly, but it does not solve renewal pressure on its own. If your mortgage is coming up for renewal, your best strategy is still to review your payment options early, compare lenders carefully, and understand whether a shorter or longer amortization, if available, fits your budget and goals.

What It Means for Refinancing

For refinancing, the bill is even more indirect. There is no Bill C-4 refinance rebate, and there is no new federal program in this legislation that reduces refinance costs or changes equity rules. If you are refinancing to consolidate debt, fund renovations, or improve monthly cash flow, the same underwriting standards and lender policies still apply.

That said, broader household affordability still matters. If lower taxes and lower fuel costs leave a household with stronger monthly cash flow, that can marginally improve financial flexibility. But from a mortgage perspective, refinancing will still depend on home equity, income, debt ratios, and the rate and term available to you at the time you apply. Bill C-4 should be seen as background support for some households, not as a refinance tool.

Home Affordability, The Real Impact

Bill C-4 is best understood as an affordability measure, not a mortgage reform package. It helps on the tax side of housing, especially for qualifying first-time buyers of new homes, and it improves after-tax income for many Canadians. That matters because affordability is not only about interest rates. It is also about how much cash buyers need up front, how much income they keep, and how resilient they are after closing.

Still, Canada's affordability challenge is larger than one bill. CMHC's Spring 2026 Housing Supply Report said housing starts rose 6% in 2025, but it also warned that pressures remain under the surface, including a weaker pipeline for ownership-oriented housing in major markets such as Toronto and Vancouver. That is an important reminder. Tax relief can help some buyers enter the market, but long-term affordability also depends on housing supply, financing conditions, and incomes keeping pace with housing costs.

From a mortgage professional's perspective, Bill C-4 is positive news, especially for first-time buyers considering new construction. But it should be treated as one piece of the puzzle. The right mortgage strategy still depends on your timeline, your income stability, your down payment, the kind of property you are buying, and how comfortable you are with future payment changes.

Practical Takeaways for Canadian Homeowners and Buyers

• If you are a first-time buyer looking at a newly built home, ask right away whether the property and your purchase structure may qualify for the new FTHB GST/HST rebate.
• If you are renewing, do not assume Bill C-4 will lower your mortgage rate. Review your options based on current market conditions and your budget.
• If you are refinancing, treat Bill C-4 as an indirect affordability factor, not as a direct refinance benefit.
• If you are budgeting for a purchase, look at the full picture, including taxes, closing costs, monthly payment, and how much emergency savings you will have left after closing.
• If you are unsure whether new construction or resale makes more sense, compare both carefully. Bill C-4 may improve the math on qualifying new homes, but only in the right situation.

The bottom line is simple. Newly passed Bill C-4 can help some Canadians, especially eligible first-time buyers purchasing qualifying new homes, and it may ease household budgets more broadly through lower taxes. But it does not directly lower mortgage rates, and it does not replace the need for smart mortgage planning. Whether you are buying, renewing, or refinancing, the best move is still to look at the full financial picture and make a decision based on your real budget, not just on a headline.

FAQs

1. Does Bill C-4 lower mortgage rates in Canada?

No. Bill C-4 does not directly lower mortgage rates. Variable rates are driven more by the Bank of Canada's policy rate, while fixed rates are influenced more by bond yields and lender pricing.

2. Who benefits most from Bill C-4 in the housing market?

Eligible first-time home buyers purchasing qualifying new homes benefit the most. The new GST rebate can reduce the tax cost by up to $50,000, depending on the home's price and eligibility.

3. Does Bill C-4 help people renewing an existing mortgage?

Not directly. There is no special renewal relief in the bill. Some households may benefit indirectly from lower personal income taxes, which can help with monthly cash flow.

4. Can I use Bill C-4 to refinance my mortgage on better terms?

Not directly. Bill C-4 does not create a refinance rebate or a new refinance program. Your refinance options will still depend on equity, income, debt ratios, and current lender pricing.

5. Does the new GST rebate apply to resale homes?

No. Based on the federal rules, the new first-time home buyers' GST/HST rebate applies to qualifying new homes, certain owner-built homes, and some co-op housing purchases, not standard resale homes.

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.

Information note

The next scheduled date for announcing the overnight rate target is April 29, 2026. The Bank's next MPR will be released at the same time.

Source: Bank of Canada Website

A new report from CMHC highlights something many Canadians are already feeling firsthand. Housing affordability challenges are no longer just a Toronto and Vancouver story. While those two cities have long been seen as the biggest examples of high housing costs, affordability pressure has now spread more broadly across Canada, including markets like Ottawa, Montréal, and Halifax.

For homebuyers, homeowners, and people renewing or refinancing a mortgage, this is an important shift to understand. It means the conversation around affordability has become more national in scope, and many households in cities that were once considered more manageable are now feeling much more pressure.

A broader affordability problem

One of the key takeaways from CMHC's analysis is that housing affordability is about more than just home prices. It also includes income levels, mortgage carrying costs, rents, supply and demand, and how much room households have in their budgets after covering other everyday expenses.

That matters because affordability cannot be measured by one simple number alone. A market may have lower home prices than Toronto or Vancouver, but that does not automatically make it affordable if incomes have not kept up, rental options are tight, or monthly ownership costs remain too high.

This broader view helps explain why affordability concerns are now showing up in more parts of Canada. In other words, even if national conditions have improved slightly from their worst point, many local markets are still under serious strain.

Why this matters to everyday borrowers

For the average Canadian, this report reinforces that affordability challenges can look different depending on the city and the type of housing being considered. Someone trying to buy a home may face one set of pressures, while a renter saving for a down payment may face another.

This is especially important for first-time buyers. In many cities, renters are dealing with higher housing costs at the same time that ownership remains difficult to reach. That can make it harder to save, harder to qualify, and harder to feel confident about entering the market.

Existing homeowners are also affected. Those coming up for renewal may be facing higher monthly payments than they expected a few years ago. Others may be reviewing refinance options, debt consolidation, or more cautious budgeting as affordability remains tight.

Not all markets are moving the same way

Another useful takeaway from CMHC is that affordability trends are not identical from one market to another. Some cities have seen a sharper long-term erosion in affordability, while others were hit harder more recently. In addition, conditions in the ownership market and rental market do not always move in the same direction at the same time.

That is why broad headlines can sometimes be misleading. A slight improvement at the national level does not necessarily mean affordability feels better on the ground in every city. Local conditions still matter a great deal, and borrowers should be careful about assuming that one national trend applies to their personal situation.

What mortgage clients should take from this

For mortgage clients, this kind of report is a reminder to focus on planning, flexibility, and realistic numbers. Whether you are buying your first home, renewing your mortgage, refinancing, or simply reviewing your next steps, affordability is now a more layered and local issue than ever before.

That means it can be very helpful to review:

• what payment range feels comfortable, not just what is technically possible
• how current rates may affect your monthly cash flow
• whether renting a little longer or buying sooner makes more sense in your market
• how local inventory and housing options may influence your decision
• what mortgage strategy best fits your goals in today's affordability environment

A more informed way to look at the market

The big message from CMHC is simple. Canada's affordability challenge has widened. It is no longer enough to look only at Toronto and Vancouver when discussing housing pressure. More cities are now dealing with meaningful affordability concerns, and both ownership and rental conditions deserve attention.

For Canadians trying to make smart mortgage decisions, this kind of research is valuable because it provides a fuller picture of what is happening across the country. It also reinforces the importance of getting advice that reflects today's market realities rather than relying on outdated assumptions.

You can read the original CMHC article here: Beyond Toronto and Vancouver: Affordability challenges spread across Canadian cities.

If you are reviewing your mortgage options in today's market, understanding the local affordability picture can make a big difference in choosing the right path forward.

Spring 2026 Home Buying in Canada, Why More Listings Still Do Not Automatically Mean Affordable Payments

If you are shopping for a home this spring, you may be hearing a confusing message, there are more listings coming to market, but affordability still feels tight. Both can be true at the same time. More inventory can improve choice and reduce some bidding pressure, but your monthly payment is still shaped by mortgage rates, qualification rules, home prices, and your down payment.

For many Canadian buyers, the real question in 2026 is not just, "Are there more homes for sale?" The real question is, "Can I comfortably qualify, and can I handle the payment?" That is what this guide is here to explain in plain language.

What is changing in the market right now

Canada entered 2026 with more homes listed for sale than the same time last year. That is good news for buyers because it usually means more choice and less pressure to make rushed decisions. In some markets, it can also mean more room to negotiate on price, conditions, or closing dates.

At the same time, more listings does not mean supply has fully normalized everywhere. Many markets are still dealing with a shortage of the types of homes buyers want most, especially affordable detached homes and family-friendly properties in strong neighbourhoods.

This is why buyers need to be careful with headlines. A national trend can sound buyer-friendly, but your local market may still feel competitive depending on the city, neighbourhood, and price range you are shopping in.

Why more listings do not automatically lower your monthly payment

A larger number of listings helps with choice, but it does not directly control your mortgage payment. Your payment is mainly determined by four things, the purchase price, your down payment, your mortgage rate, and your amortization.

This is where many buyers get surprised. They see more homes available and assume affordability has improved by the same amount. In reality, a small change in mortgage rates can have a major impact on your payment, even if the home price is only slightly lower.

That is why a proper pre-approval matters so much in 2026. Before you shop seriously, you need a realistic payment range, not just a price range. A home can look affordable on the listing page, but feel very different once mortgage payments, property taxes, utilities, and other costs are included.

What the Bank of Canada rate means for buyers

Bank of Canada rate decisions still matter a lot for homebuyers, especially for variable-rate mortgages and overall borrowing conditions. Even when the Bank holds rates steady, buyers should not assume every lender will price mortgages the same way, or that fixed rates will stay unchanged.

A rate hold can help create a more stable planning environment, which is useful for buyers who are trying to make decisions before the spring market gets busier. But lender pricing, bond market movement, and your personal borrowing profile still play a big role in what rate you are actually offered.

The practical takeaway is simple, a stable rate environment can help with planning, but it does not replace a solid mortgage strategy. You still need to review your numbers carefully before you buy.

Inflation is cooler, but affordability pressure is still real

Inflation has eased compared with the most volatile period Canadians experienced in recent years, which is a positive sign for the housing market. It can improve confidence and reduce some uncertainty around future rate decisions.

But lower inflation does not mean everyday costs suddenly feel cheap again. Many households are still managing higher grocery bills, insurance costs, transportation costs, and other monthly expenses. That matters because lenders qualify you based on your debt ratios, and you live based on your actual cash flow.

This is one of the biggest reasons buyers still feel stretched. Even if the market becomes more balanced, household budgets are still under pressure, and that affects what feels affordable in real life.

Employment and income stability matter more than most buyers think

Home buying is not only about the property, it is also about your income stability. Lenders look closely at your employment type, time on the job, and how your income is documented. This becomes even more important if you are self-employed, on contract, commission-based, or recently changed jobs.

A buyer can have a solid down payment and still run into challenges if their income is not presented properly. This is where mortgage planning before house shopping can save time and stress. It helps you understand how a lender will view your file before you start making offers.

If your income structure is more complex, a mortgage broker can often help match your application to lenders that are better suited to your situation.

Housing supply is improving slowly, not all at once

Housing supply is improving in some areas, but it is happening gradually. New construction, resale inventory, and buyer demand do not move in perfect sync. Some regions are seeing better selection, while others are still tight in key price points.

This is why local strategy matters. A national headline may say supply is improving, but your experience could be very different depending on where you are buying and what type of home you need.

For buyers, the best approach is to focus on your local market conditions and your own payment comfort. Those two things will matter more than broad national headlines when it comes time to make a confident decision.

The mortgage stress test is still a key affordability factor

Even if home prices soften in some markets, buyers still need to qualify under Canada's mortgage lending rules, including the stress test where applicable. This is one of the main reasons why affordability can still feel tight, even when there is more inventory available.

Being approved and being comfortable are not the same thing. A buyer may qualify for a certain amount, but that does not mean the payment fits comfortably alongside daily living costs, savings goals, and unexpected expenses.

A strong plan leaves room in the budget. That flexibility matters, especially in a market where rates and household expenses can still shift over time.

How this affects renewals and refinancing too

Even though this topic is focused on buying, the same affordability pressure affects homeowners who are renewing or refinancing. Many households are reviewing whether to renew, refinance, or move, based on how their monthly costs will change.

If you already own a home, this is a smart time to compare your options before your renewal date. If you are considering refinancing for debt consolidation or cash flow reasons, it is important to review the full payment picture and qualification rules before making a move.

In many cases, the best decision comes from comparing all options together, buying, renewing, and refinancing, before committing to one path.

What Canadian buyers should do now

• Get a full pre-approval review so you know your realistic payment range, not just a rough estimate.
• Budget for the full housing cost, including property taxes, heating, condo fees, and maintenance.
• Compare fixed and variable mortgage options based on payment comfort and long-term plans.
• Leave room in your monthly budget for everyday expenses and future cost increases.
• Focus on local market conditions, because affordability and inventory vary widely by area.

Spring 2026 may offer more opportunity for buyers than some recent years because there is better selection in parts of the market. But more listings alone does not solve affordability. The buyers who do best are the ones who build a mortgage strategy first, then shop with confidence.

Frequently Asked Questions

1) If there are more homes for sale, will prices drop everywhere in Canada?

Not necessarily. More listings can reduce pressure in some markets, but prices are always local. Some areas may soften, while others remain stable or competitive depending on demand and property type.

2) Does a Bank of Canada rate hold mean mortgage rates will not change?

No. A Bank of Canada rate hold can help with stability, but lenders can still change pricing. Variable and fixed rates can move for different reasons, so it is important to review current options before making a decision.

3) Why do I still feel stretched if inflation is lower?

Because lower inflation means prices are rising more slowly, it does not mean costs have gone back down. Many households are still dealing with higher everyday expenses, which reduces room in the monthly budget for housing.

4) What is the biggest mistake buyers make in a market with more listings?

A common mistake is shopping based on the maximum approval amount instead of a comfortable monthly payment. It is usually better to buy within a range that leaves breathing room in your budget.

5) Should I get pre-approved before I start viewing homes in spring 2026?

Yes. A proper pre-approval helps you understand what you can comfortably afford, strengthens your position when making an offer, and helps you avoid surprises during the buying process.

Canada's rental market finally showed signs of breathing room in 2025. After several years of ultra-tight conditions, CMHC reports that vacancy rates rose across all major census metropolitan areas (CMAs), and rent pressure eased in many markets as supply increased and demand cooled.

This post breaks down the national story behind the numbers, why the shift is happening, and how to use these insights whether you're renting, investing, renewing a mortgage, or planning a move in 2026.

Source: CMHC Rental Market Reports (Major Centres)

The biggest headline: Vacancy rose nationally

CMHC's national snapshot shows the average vacancy rate for purpose-built rental apartments increased to 3.1% in 2025, up from 2.2% in 2024, and now sits above the 10-year average. In plain terms: renters had more options, and landlords had to compete harder for tenants in many areas.

That does not mean affordability is suddenly fixed. It means the market is less "winner takes all" than it was in 2022 to 2024, especially for certain unit types and neighborhoods with lots of new completions.

Why the market eased: Supply went up, demand softened

CMHC points to a clear supply-and-demand shift.

• Rental supply expanded: Several years of strong rental construction delivered new units in 2024 and continued into 2025. More completions created more choice, particularly in cities with big development pipelines.
• Demand cooled: CMHC notes weaker renter household formation and softer demand conditions tied to slower population growth, fewer international students in some markets, and a labour market that became harder for younger workers.
• Lease-ups slowed: New buildings took longer to fill, and incentives became more common (think free rent months or move-in credits) as operators worked to stabilize occupancy.

One important takeaway here is that "more units" helps, but the type of units matters. Many new deliveries are higher-end, which can increase competition at the top of the market first, then gradually create a filtering effect as households move up the quality ladder and leave vacancies behind.

The "filtering effect": More movement, more options

CMHC also observed increased renter mobility in 2025. With more vacancies and fresh supply coming online, tenants were more likely to move to something that fit their lifestyle better (location, unit size, building amenities, and overall value).

This matters because mobility is a pressure valve. When renters can move without massive rent shock, it reduces the sense of being stuck and helps the market function more normally.

Vacancy rose across all rent ranges (not just luxury units)

A notable point in the CMHC analysis is that the increase in vacancy rates was not limited to high-rent units. In 2025, vacancy increased across all rent ranges. CMHC even notes that for the first time in a decade, the least expensive units contributed to the increase in vacancy rates.

That said, "least expensive" is relative. In many markets, entry-level rents are still high compared to incomes, and affordability remains a challenge even when vacancy improves.

National rent pressure eased, but not evenly

CMHC's report describes "softened market conditions" and "eased rent pressures" nationally. But the pattern varied by region and city. Some markets saw rent growth slow or flatten, while others still experienced sharp increases driven by local factors like rent guideline changes, supply constraints, or strong population inflows.

One of the most practical indicators CMHC provides is the average monthly turnover rent for a 2-bedroom purpose-built rental apartment in major CMAs. Turnover rent is what new tenants pay when a unit changes hands, and it often rises faster than rents for existing tenants.

Here are CMHC's 2025 turnover rent figures for 2-bedroom purpose-built rentals in selected major markets:

• Vancouver: $2,696
• Toronto: $2,547
• Montréal: $1,644
• Ottawa: $2,155
• Calgary: $1,836
• Edmonton: $1,600
• Halifax: $2,058

CMHC notes that as turnover rents soften, landlords have less room to raise rents when a new tenant moves in, which can limit overall rent growth over time. This is one of the clearest ways the market "cools" in the real world.

Condo rentals: Vacancies rose, but stayed tighter than purpose-built

CMHC also tracks condominium apartments offered for rent (the secondary rental market). In 2025, condo rental vacancies increased too, but generally remained well below the purpose-built vacancy rate.

The report notes that condo owners were often more flexible on rents to avoid vacancies. In a softer market, smaller landlords may respond faster with price reductions, incentives, or upgraded terms to keep a unit occupied.

What this means if you're a renter

If you're renting, 2025's shift is meaningful even if it doesn't feel like a full "reset."

• More negotiating power: In markets with rising vacancy, renters may see incentives, more responsive landlords, and a bit more time to choose the right place.
• More choice in newer buildings: Some new projects take longer to lease, which can create short windows where promotions show up.
• Be strategic about timing: If you're flexible, shop around and compare multiple buildings in the same neighborhood. Competition is your friend.

Tip: If you're researching your city in detail, CMHC provides market-level downloads and data tables alongside the report.

CMHC Rental Market Report Data Tables (Excel)

What this means if you're a landlord or rental property investor

For landlords, the story is about competition, retention, and realistic rent expectations.

• Retention matters more: In a softer market, keeping a good tenant can be more valuable than pushing for top-of-market rent.
• Incentives are back: CMHC highlights incentives in multiple markets, particularly where new supply is heavy. If your building competes with new product nearby, you may need a plan.
• Unit positioning matters: Cleanliness, responsiveness, small upgrades, and clear lease terms can outperform a "price only" approach.
• Watch turnover rent trends: If turnover rent is moderating, underwriting assumptions for future rent growth should be more conservative.

If you're buying a rental or refinancing one, this is also where lenders can get stricter about rental income assumptions in certain markets, especially where vacancy has jumped and lease-ups are slower.

What this means if you're planning to buy a home

A cooler rental market can influence buying decisions in a few ways.

• Less "rent panic" pressure: When renters have more options, some households may delay buying and wait for the right property or rate environment.
• Investor math changes: If rent growth is moderating and vacancies rise, investors need to be more careful with cash flow assumptions.
• Local conditions matter more than ever: National vacancy rising does not mean your neighborhood is easing. Some pockets remain extremely tight.

The best approach is to treat the national overview as the macro weather report, then zoom into your city and neighborhood for the decision-making details.

How to use CMHC's report as a monthly or quarterly content engine

If you're a mortgage professional, real estate investor, or housing-related business, CMHC's Rental Market Report is one of the most useful "evergreen plus timely" resources in Canada.

• Create city-specific summaries for your audience, then link back to the national report for credibility.
• Publish a "What this means for renters" and a separate "What this means for investors" version.
• Use the turnover rent numbers to explain affordability and budgeting in real dollars.
• Track vacancy changes year-over-year to explain why incentives are appearing or disappearing in your market.

Bottom line

CMHC's 2025 national overview confirms a notable shift: vacancy is up, lease-ups are slower, and rent pressures have eased in many major markets as supply growth meets softer demand. For renters, that can mean more choice and occasional incentives. For landlords and investors, it means competition, retention strategies, and more conservative forecasting.

To explore the full report and drill into specific markets, use CMHC's Rental Market Reports hub here: Rental Market Reports (Major Centres).