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Economic Update

September 26th 2025

First-Time Buyers: Taking Their Time

A new survey from Royal LePage shows that 13% of Canadian adults plan to buy a home within the next two years. But most of them (82%) say they’re waiting at least 12–24 months before making the move. Only a small number are ready to buy within the next year.

Why the wait?

• Rates are coming down and home prices have softened, especially in big cities like Toronto and Vancouver.

• Uncertainty remains, from the economy to global trade.

• Many buyers are saving more, hoping affordability will improve further.

How buyers are adjusting:

• 6 in 10 are looking in more affordable areas.

• 4 in 10 are willing to buy smaller homes.

• Nearly 4 in 10 are cutting back on extras to save more.

👉 What it means for buyers: Even though conditions are improving, many are choosing patience. If you’re in the same boat, it’s a good time to stay prepared, build savings, research areas, and check in on your options regularly.

Canada’s Economy: A Stop-and-Go Story

Canada’s economy grew 0.2% in July but then came to a halt in August (0.0%).

This has left experts divided on what the Bank of Canada will do at its next meeting on October 29:

• Some think they’ll cut rates by 0.25% to help stimulate growth.

• Others believe they’ll wait to see what happens with the federal budget on November 4.

What this means for you:

• The odds of a rate cut in October have dropped to about 40%.

• More economic data (like job numbers on Oct. 10 and inflation on Oct. 21) will help decide the Bank’s next move.

• Variable-rate mortgage holders shouldn’t expect a fast drop in rates, but another small cut this year is still possible.

Mortgage & Housing Highlights

• Rental market: A strong supply of new rentals coming onto the market may help keep rent increases in check.

• RRSP Home Buyers’ Plan (HBP): If you withdraw funds before Dec. 31, 2025, you won’t need to start repaying until 2030. Withdrawals after Jan. 1, 2026, will require repayment starting in 2028.

• Condo market: While Toronto condos are struggling, Canada’s overall housing shortage and stricter rules for builders should help limit long-term risks.

• Boomer retirements: With more Canadians reaching retirement age, labour shortages could put pressure on wages over the next several years.

Fixed vs. Variable Rates

Fixed mortgage rates are holding steady for now. Even though bond markets suggest there’s room for lenders to lower rates, many are taking a “wait and see” approach until more economic data comes in.

👉 What this means for buyers and homeowners: Rates are slowly edging lower, but don’t expect big moves right away.

Final Word

The housing market is slowly shifting in buyers’ favour, rates are easing, inventory is building, and prices have softened in many areas. But many first-time buyers are still waiting for more certainty.

If you’re considering a purchase in the next year or two, now is the time to stay prepared: keep saving, stay informed, and explore your options. That way, you’ll be ready to act when the timing feels right for you.