What’s Changed Since the Pandemic?

Remember those record-low mortgage rates in 2020 and 2021? Many Canadians locked in 5-year fixed terms under 2%. But if you’ve been waiting for those deals to return, it’s time to reset your expectations.

Those ultra-low interest rates were never meant to last. They were emergency measures, introduced when the Bank of Canada slashed rates to near zero during COVID-19 lockdowns. Now that the economy has stabilized and inflation is no longer considered “transitory,” those rock-bottom rates have disappeared — likely for good.

Why Mortgage Rates Aren’t Expected to Drop Back to 1%

Leading economists and housing experts, including those at Canadian Mortgage Trends, agree: sub-2% rates are unlikely to return. Here’s why:

• Persistent Inflation Pressures – Inflation remains above the Bank of Canada’s 2% target.

• Global Economic Shifts – Higher oil prices, supply chain changes, and geopolitical instability all contribute to higher costs.

• Strong Employment Numbers – With Canada’s job market holding steady, there’s little incentive for the central bank to aggressively slash rates.

• Government Spending – Initiatives like housing programs and infrastructure projects add upward pressure on inflation, keeping rates higher for longer.

What This Means for Toronto Homeowners

Whether you’re renewing your mortgage, purchasing your first home, or considering an investment property, today’s rate environment calls for a fresh strategy. A Toronto mortgage broker can help you:

• Adjust Your Budget Expectations – Plan for mortgage rates in the 4–6% range.

• Explore More Lender Options – Brokers have access to banks, credit unions, and private lenders.

• Consider Shorter Terms or Variable Rates – If you think rates may decline slowly, you may not want to lock into a long-term fixed mortgage.

• Get Pre-Approved Early – Securing today’s rate can protect you from potential hikes.

What If You Bought at Low Rates in 2020?

If you secured a mortgage during the pandemic, renewal in 2025 or 2026 could mean a steep jump in payments. Here are proactive steps to take now:

• Reassess Your Budget – Don’t wait until renewal; adjust spending today.

• Consider Refinancing – Extending your amortization could help reduce monthly payments.

• Shop Around With a Broker – If your current lender’s renewal offer isn’t competitive, a broker can connect you with better options.

The Bottom Line

Ultra-low rates served their purpose during the pandemic, but they weren’t sustainable. Today’s 4–6% range is closer to historical norms — and likely here to stay.

The good news? With the right advice, you can still make smart mortgage moves. Working with an experienced Toronto mortgage broker ensures you’re not only getting competitive rates but also a strategy that fits your financial goals.

Need Expert Mortgage Advice in Toronto?

Navigating today’s higher-rate environment requires planning and the right guidance. Whether you’re renewing, refinancing, or buying your first home, I can help you find a tailored solution.

📞 Call me today at 647 694-7033
📧 Email: [email protected]

FAQs About Toronto Mortgage Brokers and Mortgage Rates

1. Will mortgage rates in Toronto ever go back to 1%?

It’s very unlikely. The 1% mortgage rates we saw in 2020–2021 were a direct response to the global pandemic. With inflation, government spending, and global economic pressures, experts predict rates will stay in the 4–6% range for the foreseeable future.

2. How can a Toronto mortgage broker help me save money?

A mortgage broker in Toronto works with multiple lenders, not just one bank. This means they can shop around for better rates, negotiate on your behalf, and find mortgage products tailored to your financial situation.

3. Is it better to go with a bank or a mortgage broker in Toronto?

Banks only offer their own products, while mortgage brokers have access to dozens of lenders — including banks, credit unions, and private lenders. This wider access often gives brokers an edge in securing competitive rates.

4. Should I choose a fixed or variable mortgage in today’s market?

It depends on your risk tolerance. A fixed mortgage provides stability with predictable payments, while a variable mortgage may save you money if rates decline over time. A Toronto mortgage broker can help you assess which option fits your budget and goals.

5. What should I do if my mortgage is up for renewal in 2025 or 2026?

Start planning now. With rates higher than they were in 2020, renewing could mean a big increase in monthly payments. Speak with a mortgage broker early to explore refinancing, extending your amortization, or switching lenders for a better deal.

6. How do I choose the best Toronto mortgage broker?

Look for a licensed broker with strong reviews, industry experience, and transparent communication. Don’t be afraid to ask about their lender network and how they’re compensated.