Waiting Game: Why Lower Mortgage Rates Might Take a Little Longer

If you’re hoping for lower mortgage rates soon, you’re not alone. But the road to more rate cuts might take a bit longer than many had hoped.

Canada’s central bank is watching the economy carefully, and while things are starting to cool down, they’re not ready to move quickly on cutting mortgage rates again. There’s still a lot of uncertainty—especially with inflation sticking around and ongoing concerns about global trade and tariffs.

Lately, the Bank has been relying on more than just the usual numbers. They’ve been listening directly to Canadians and businesses to get a better feel for what’s really happening. Those conversations played a big role in the decision to hold the policy rate steady at 2.75% this week, which means no immediate change to mortgage rates.

What they’re hearing isn’t surprising: many businesses expect slower activity ahead, which could mean job losses. Companies are also dealing with rising costs, and that pressure could lead to higher prices—another factor that can affect mortgage rates.

Homeowners, especially those with renewals coming up, are keeping a close eye on mortgage rates. After a couple of rate cuts earlier this year, many had hoped for more by now. But for the moment, patience is key.

Since last spring, the central bank has lowered rates by 2.25 percentage points—bringing some relief to mortgage rates—but the uncertainty hasn’t gone away. The Bank knows how much Canadians depend on stable mortgage rates, and they’re committed to making careful, steady decisions.

What’s also become clear is that official stats don’t tell the whole story. Through surveys and community visits, the Bank has heard about the real struggles people are facing—especially when it comes to housing. In many cities, high home prices combined with high mortgage rates are making it tough to attract new talent. And in the social services sector, there’s growing concern about food bank use and housing insecurity.

People are also thinking twice before making big purchases, and rising mortgage payments are a big reason why. For those working in industries hit hard by trade issues, the pressure is even greater. When income feels uncertain, managing higher mortgage rates becomes even more stressful.

Even though inflation is cooling off, people are still worried. Expectations for rising prices—and mortgage rates—have crept up again, partly because of all the talk around tariffs and economic instability.

Bottom line? While we might get more relief on mortgage rates down the road, it’s not quite here yet. For now, Canadians will have to wait a little longer—and keep a close eye on where mortgage rates are headed next.