Held again — and what a rental suite is worth to your application
A fifth consecutive hold. Prime is unchanged, and has been for over half a year.
With rates flat, the way to improve a Toronto file is on the income side, and in this city the most powerful lever is usually rental income. A legal second suite, a basement apartment, a duplex, a laneway house — lenders will use a portion of that rent to help you qualify, and on a purchase near a million dollars it can move what you can borrow by a very large amount.
The details are where files succeed or fail. Lenders differ genuinely on how much of the rent they will use and on whether they add it to your income or subtract it from the payment — the second approach is far more generous and is not offered by everyone. They differ on whether the suite has to be legal and registered, on whether they will use a market-rent appraisal or only a signed lease, and on how they treat a unit that is currently vacant. This is one of the areas where which lender you apply to genuinely changes the answer, so it is worth working out before the application rather than after a decline.
May's market: 6,583 sales — a healthy spring volume — at an average of $1,069,700, with 4.8 months of supply. Buyers came back; prices did not move much. That is a good combination if you are one of them.
What the Bank said
“The Bank of Canada today held its target for the overnight rate at 2.25%, with the Bank Rate at 2.5% and the deposit rate at 2.20%. The conflict in the Middle East is now in its fourth month.”
The rate path around this decision
For context, unemployment was running at about 6.5% and inflation at 2.8% 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.