Time for your cheat sheet on this week’s top stories.
Canadian Real Estate
Canada Uses US Bubble Scheme To Transfer Investor Risk To Home Buyers
Ontario is the latest province to offer sales tax relief to first-time buyers of new homes. The move follows federal incentives announced earlier this year, adding to the recently introduced stimulus. It seems generous, but it mirrors demand-inducement schemes from the US housing bubble of the 2000s. Since end users are less likely to default than investors, the idea is to transfer losses to families who will ride those losses out over a lifetime. How generous.
Canada’s Mortgage Arrears Are Now Growing Faster Than The ’90s
Canadian mortgage arrears hit 0.24% in August 2025, a five-year high for CBA members. The rise is believed to be normalization, after falling to a record low in 2023. That’s what they thought during the early 1990s real estate crash, after arrears had set a then-record low in 1989. Brushing off the decline could prove an even bigger mistake this time. Today’s “normalization” is even faster than the one that led to a record high in the early 1990s.
Toronto Only Saw 53 New Condo Sales But Prices Climbed—Here’s Why
Greater Toronto’s real estate slump continues to drag, though condo prices didn’t get the message. New home sales fell to a record low for September, with just 255 condos sold—only 53 in the City. Experts expect prices to fall when there are more than 6 months of inventory, but condo prices just climbed despite having 10x that level—62 months of inventory. It’s unlikely that the market is defying gravity, but more likely a quirk in the methodology.
Bank of Canada Cuts Rates, Prioritizing Survival Over Inflation Control
The Canadian real estate industry was counting on rate cuts, but they may not provide the expected relief. The Bank of Canada (BoC) trimmed the overnight rate by 25 basis points to 2.25% at its October meeting, aiming to offset a weakening economy. Despite citing this justification, the BoC admitted it’s the wrong tool for addressing the structural issues being faced. Markets agreed: bond yields jumped on inflation concerns, pushing fixed-rate borrowing costs higher.
Canadian Private-Sector Business Count Falls To 2023 Low
Canada’s business count may look resilient, but its composition reveals the truth. There were 938,500 active businesses in July, budging very little over the past year. However, just 87.1% of those businesses were outside of education, healthcare, and social services (EHS) sectors, largely dependent on public spending. The decline in private industry began well before recent tensions, suggesting public spending is masking deeper structural erosion. At least among those not dependent on taxpayer funding.
Canadian Immigration Didn’t Tank (Or Help) The Economy: CIBC
Canadian immigration doesn’t deserve the blame it gets for the economy, though it didn’t help. That was the take from CIBC Economics this week, attributing most of the economic downturn to structural issues. The bank even argues, in some cases, the surge in immigration may have mitigated the downturn expected.
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