First off, I'd like to wish you and your loved ones a Happy New Year! I was fortunate enough to spend the holidays with my family in Asia this year. We visited family in Cambodia, spent a week in Thailand and a week in Vietnam. If you've never been I'd highly recommend. The food is incredible, beautiful beaches and the people are amazing.
Now back to work...
A 2024 mortgage recap and a look ahead at what's to come
If 2023 was about resilience, 2024 was about recovery and moving forward. The Bank of Canada finally shifted to cutting rates and delivered five consecutive rate cuts, reducing its policy rate from a high of 5.00% to 3.25%. This brought prime—used for pricing variable, adjustable, and line of credit products—from 7.20% to 5.45% with most lenders. This was a welcome change for many borrowers and is now starting to provide Canada’s housing market with a much-needed boost.
The housing market saw renewed activity in 2024, driven by falling interest rates for both variable and fixed mortgages. As borrowing costs eased and consumer confidence in the market improved, more buyers returned to the market, sparking a modest rebound in home prices. According to the Canadian Real Estate Association (CREA), national home prices were expected to end 2024 about 0.9% higher than the previous year.
Looking ahead to 2025: steady progress on the horizon
As we step into 2025, the outlook is cautiously optimistic. Economists anticipate a couple more quarter-point rate cuts from the Bank of Canada before it slows its easing cycle and likely pauses by the second half of the year. Current forecasts from major bank economists suggest the policy rate could fall anywhere between another .25% to 1.25%, depending on inflation and broader economic trends.
The housing market is expected to stay active, with steady sales growth and modest price increases. CREA forecasts national home sales to climb a further 6.6% in 2025 as interest rates continue to decline and demand flows back off the sidelines.
Here to guide you through 2025
Whether you’re planning to buy, renew, or refinance this year, I’m here to help. Let’s review your options and create a plan that works for you—whether that’s securing the best rate, finding the right product, or simply answering your questions.
Let’s make 2025 a year of progress and success. Reach out anytime—I’d love to hear from you!
Andy Vickers
Mortgage Professional
(250) 507-0566
avickers@mortgagegroup.com