Ontario Mortgage Advice That Fits Your Life

Canada's Next Rate Move May Be a Hike, Not a Cut, Says RBC

Many homeowners have spent the past year planning around one assumption: that the Bank of Canada's next move would be another rate cut. RBC's economics team says that bet may not pay off — and the next move could actually be up.

In a new outlook, RBC economists Nathan Janzen and Claire Fan say they expect the Bank of Canada to hold its policy rate steady for now, with the balance of risk tilting toward a hike starting in early 2027 rather than further cuts.

What RBC Is Forecasting

Fan put it plainly: "We still don't see the Bank of Canada cutting the overnight rate." She added that if the rate does move, it's "more likely to be a hike although we don't expect that until 2027."

Why RBC Thinks the Next Move Could Be Up, Not Down

Tariffs are being treated as a supply shock, not a demand problem. The U.S. imposed 50% tariffs on a portion of Canadian imports in August 2025, and the Bank of Canada has suggested this could slow Q4 growth to below 1% annualized. But rather than cutting rates to offset that hit, the Bank appears to favour targeted fiscal support — since a rate cut does little to fix a supply-side disruption and risks adding fuel to inflation instead.

Inflation risk is still on the table. Elevated oil prices and wide refinery margins are keeping policymakers cautious about easing further, since cutting rates into an inflation risk could make things worse, not better.

The economy looks more resilient than the headlines suggest. July GDP came in flat, but other indicators tell a steadier story — hours worked rose 0.6% in August, job openings have held steady, and advance retail sales climbed 1.3% month-over-month. Taken together, it's not the kind of weakness that typically pushes a central bank toward more cuts.

What This Means If You Have a Mortgage Coming Up

A lot of Ontario homeowners have been timing renewal and refinancing decisions around the hope of more cuts. RBC's outlook is a reminder that this isn't guaranteed — rates may simply hold steady for an extended period, with the next move potentially being higher rather than lower. If you're on a variable rate, renewing soon, or weighing fixed versus variable, it's worth running your numbers against a "rates stay flat or rise" scenario rather than assuming relief is on the way.

My Take as a Mortgage Professional

Speculating on rate direction is a risky way to plan a mortgage. Whether the Bank of Canada holds, cuts, or eventually hikes, the smarter approach is to build a strategy around your own budget, timeline, and risk tolerance — not a forecast. If you're coming up on a renewal or thinking about locking in, now is a good time to look at your options rather than wait and see.

Could 40- or 50-Year Mortgages Be Coming to Canada? The Mortgage Industry Is Divided

Housing affordability remains one of Canada's biggest challenges — and now a new debate is gaining traction in the mortgage world: Should Canada allow even longer mortgage amortizations?

Recent changes allowing some buyers access to 30-year insured amortizations were designed to ease monthly payments and improve affordability. But some mortgage professionals argue it still doesn't go far enough.

What Is an Amortization Period?

Your amortization is the total length of time it takes to pay off your mortgage. In Canada, the traditional standard has been 25 years. Longer amortizations — like 30, 40, or even 50 years — lower your monthly payment by stretching repayment over a longer period. That can improve affordability and help buyers qualify for larger mortgage amounts.

Why Are Longer Amortizations Being Discussed?

With home prices still elevated across many Canadian markets and affordability stretched, some industry voices believe current solutions aren't enough. The argument is simple: when average home prices continue climbing while interest rates remain higher than the ultra-low environment Canadians became used to, many first-time buyers struggle to enter the market.

Supporters of longer amortizations believe extending repayment periods could create a more realistic path to homeownership for buyers who are otherwise locked out.

The Other Side of the Debate

Not everyone agrees. Critics argue that extending amortizations may reduce monthly payments in the short term, but it doesn't solve the root issue: housing affordability and supply. There's also concern that easier qualification could increase demand, potentially placing upward pressure on home prices again.

And from a financial planning perspective, borrowers must weigh the long-term cost carefully. A longer amortization can improve cash flow today — but it may also mean carrying mortgage debt much longer and paying tens or even hundreds of thousands more in interest over time.

What This Means for Homebuyers Today

The reality is that there's no universal "best" amortization. The right strategy depends on:

For some buyers, a longer amortization can be a valuable tool. For others, a shorter repayment plan may build equity faster and reduce total borrowing costs.

My Take as a Mortgage Professional

Mortgage rules continue to evolve, and affordability solutions are changing quickly. Whether you're buying your first home, renewing, refinancing, or simply exploring your options, understanding how amortization impacts your payment strategy matters. Sometimes a small adjustment in structure can make a meaningful difference.