The first hold — and why the stress test still decides your file
The first hold since the cutting cycle began. Seven cuts took the policy rate from 5% to 2.75%; the Bank has now stopped to look at what tariffs are going to do before deciding whether it is finished.
This is a good moment to be honest about what rate cuts have and have not done for Toronto buyers. They have lowered payments substantially — prime is 2.25 points off its peak. They have done much less to what you can qualify for, because the stress test adds two points to whatever you are offered, and because the binding constraint on most GTA files is not the payment at all. It is the down payment, and it is income against a loan size that is simply large.
The specific place this bites is the $1.5 million line. Below it, minimum down is 5% of the first $500,000 plus 10% of the rest. At $1.5M and above, insurance is unavailable: 20% down, so $300,000 on the nose, and a narrower field of lenders. A detached house in much of the 416 sits on the wrong side of that line, which is a large part of why so many Toronto buyers who could comfortably carry a house end up in a semi or a townhouse instead.
March gave 5,011 sales at an average of $1,093,254 with 3.9 months of supply. Inventory keeps climbing. If you have your financing arranged, this is a market that rewards patience rather than punishing it.
What the Bank said
“The Bank of Canada today maintained its target for the overnight rate at 2.75%, with the Bank Rate at 3% and the deposit rate at 2.70%. The major shift in direction of US trade policy and the unpredictability of tariffs have increased uncertainty, diminished prospects for economic growth, and raised inflation expectations.”
The rate path around this decision
For context, unemployment was running at about 6.9% and inflation at 1.7% around this decision.
Where this leaves you
Rate announcements make headlines; approvals turn on your own numbers. If you're buying, renewing or refinancing in Toronto, the useful next step is finding out what you actually qualify for — see current rates, run the math, or start an application. You can also follow the local market in our Toronto housing market reports.