A third hold, and the fixed-versus-variable question
Three consecutive holds. Prime has been at 4.45% for five months, and the market has largely stopped expecting a cut.
That changes the fixed-versus-variable calculation, which for two years was really a bet on how fast the Bank would cut. With the cutting cycle apparently over, a variable is no longer a discounted rate that you expect to fall — it is simply a floating rate that moves if the Bank moves, in either direction. Compare the two on what they cost today and on which one lets you sleep, and note that a variable generally carries a much cheaper penalty if you break it early. If there is a realistic chance you sell or refinance mid-term, that penalty difference can be worth more than the rate difference.
February's market: 3,868 sales at an average of $1,008,968, with 5.0 months of supply — the highest in this cycle. Prices are roughly where they were a year ago and inventory is still building.
For a first-time buyer the notable thing is what the condo market now costs relative to freehold. Those two have moved apart steadily since 2024, and the entry point into an apartment is far lower — both in price and, because of how the insured down-payment scale works, in the cash needed to get in.
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 war in the Middle East has increased volatility in global energy prices and financial markets, and heightened the risks to the global economy.”
The rate path around this decision
For context, unemployment was running at about 6.7% and inflation at 2.4% 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.