Changes to the rules surrounding mortgages that come into effect Sunday should help more people enter the housing market as buyers, real estate experts say.

The changes, which were announced by the federal government back in September, include allowing first-time home buyers and buyers of newly built homes to draw out the length of their mortgages, among other things.

The updates, effective Dec. 15, are a good move, local mortgage broker Mary Sialtsis told the Star: “It’s going to open some new opportunities for buyers.”

What are the new rules?

For the first time since 2012, the price cap for mortgages insured against default has been increased, to $1.5 million from $1 million, to permit more people to qualify with smaller down payments.

Before this change came into effect, first-time buyers of homes purchased for over $1 million had to put at least 20 per cent down, but those buying for less than $1 million could put as little as five per cent down.

The updated rules also make first-time home buyers with insured mortgages, and any buyer of a new build, eligible for a 30-year amortizations — giving them more time to pay down the balance — as opposed to the 25-year limit faced by others.

International migration continues to account for most of the increase in population.

The federal government tightened up temporary foreign worker program rules and capped study permits after facing significant political scrutiny for the impact of strong population growth on housing and services.

The report says the three-month period saw the lowest net increase in the number of non-permanent residents of any third quarter since 2015, excluding the third quarter of 2020 when the COVID-19 pandemic led to a sharp decrease.

About 80,000 people moved between provinces in the third quarter, marking a decrease in interprovincial migration that is closer to pre-pandemic levels.

The Canadian and American economies often move together, but the loonie is the latest sign that won’t be the case this time. The Canadian dollar has been plunging against the US dollar, a.k.a. Greenback. That loonie’s erosion was amplified this month as the two central banks diverged on outlooks for their respective economies, with the American economy set to outperform the Canadian economy significantly.

This kind of weakness hasn’t been observed outside of the deepest global recessions, and with Canada prioritizing non-productive investments—relief may not be around the corner.

Currency strength is an important economic lever, with a weak loonie having pros and cons. Advocates of a weak loonie against the greenback feel this helps make investment more attractive. Foreign companies essentially get a discount on everything from land to labor. Historically, this has helped revive real estate investment, and created well-paying jobs—notably with US tech giants, the film industry, and banking. However, a weak loonie isn’t a free ride.

After rents declined for the first time since 2021 in October, prices slipped even further in November, reaching a 15-month low.

By the end of the month, average asking rents for all unit types had hit $2,139, down 1.6% from last November and 0.6% from the previous month when rents had dropped 1.9%, according to the latest National Rent Report from Rentals.ca and Urbanation.

The year-over-year decline, the report points out, can largely be attributed to the falling of asking rents over the second half of 2024, with rents down 2.8% since July. This declining trend is encouraging for renters who have faced massive rent hikes in recent years, though rents still remain 6.7% higher than two years ago and 18.8% higher compared to three years ago.

Even if this is the last dip for a while, economists believe that first-time homebuyers may have a substantial edge.

Specifically, since this cut runs alongside recent amendments to insured mortgages (which boost the national price cap to $ 1.5 million) and the expansion of amortizations for first-time buyers — moving the timeline up to 30 years.

Rishard Rameez, who operates the Ontario-based real estate platform Zown, has been assessing these market trends to understand what 2025 may look like for would-be home buyers in Ontario.

“This December has been very different for us compared to last year. As of now, we are seeing a significant increase in inbound calls from people preparing a home purchase. Over the next two or three months, we are likely going to see a 20 to 30 per cent increase in first-time home buyers,” Rameez told INsauga.com.

Former Bank of Canada deputy governor Paul Beaudry expects policymakers to cut their key interest rate until it hits at least 2.75 per cent, with the path beyond that point less clear.

Beaudry said he expects the next move in January to be a quarter-point cut, after two half-point cuts in a row. Officials paired Wednesday’s rate decision with a statement that said they will evaluate the need for further cuts “one decision at a time,” but Beaudry said it’s obvious rates are still going to decline from this point.

The benchmark overnight rate is now at 3.25 per cent, the top end of the bank’s estimate for the so-called neutral range. The bottom of that band is 2.25 per cent, and Beaudry said the central bank will likely push to get to the middle of the range.

“It should be decreasing rather quickly to get there,” said Beaudry, who now teaches economics at the University of British Columbia. “Then the question is what will it do when it gets to the centre of that band, which is about 2.75 per cent?”

Recently, Abacus Data partnered with the Canadian Real Estate Association (CREA), the Canadian Alliance to End Homelessness (CAEH), and the Co-operative Housing Federation of Canada (CHF Canada) to conduct a comprehensive national survey to examine the current state of housing in Canada. This study, which engaged 6,000 Canadian adults (aged 18 and older) and was conducted between September 26 and October 9, 2024, sheds light on the ongoing challenges of housing affordability and accessibility, revealing significant concerns across the country.

This report is the first in a series examining the current state of housing in Canada, with a spotlight on the pressing challenges of affordability and accessibility that have become key concerns for Canadians. The findings highlight the extensive impact of the housing crisis, as these issues continue to dominate public priorities and fuel widespread concern about housing insecurity.

A surprise jump in the unemployment rate in November drove the loonie lower on Friday and raised odds among markets and some big banks for a second consecutive oversized interest rate cut from the Bank of Canada.

Canadian employers collectively added some 51,000 jobs in November, Statistics Canada said, but the unemployment rate jumped to 6.8 per cent as more people looked for work.

That brings the jobless rate 0.3 percentage points higher than in October and to its highest levels since January 2017, outside the COVID-19 pandemic years.

Across the country, job gains were in mainly full-time work and in the public sector last month, StatCan said.

Both the magnitude of the rise in the unemployment rate and the number of job gains last month topped the consensus of economists’ expectations.

Canadian real estate watchers are expecting home prices and housing activity to rise in 2025 after a “recovery year,” but the Bank of Canada’s policy rate will still have sway over how quickly buyers come back.

Royal LePage released its 2025 housing outlook on Thursday, forecasting the aggregate price of a home in Canada will hit $856,692 in the fourth quarter of next year, a 6.0-per cent year-over-year hike.

For the single-family detached market, prices are expected to rise 7.0 per cent annually to just over $900,000. Condos meanwhile are forecast to increase 3.5 per cent year-over-year to $605,993.

More affordable housing markets are expected to see the most sizeable gains next year, led by Quebec City (up 11 per cent), Edmonton and Regina (both up nine per cent). Montreal is forecast for 6.5-per cent growth, outpacing the metropolises of the greater Toronto (up 5.0 per cent) and Vancouver (up 4.0 per cent) areas.