Don’t Wait for a Rate. Plan for a Payment.

Category: Blogs,Mortgage Tips & Advice

Don’t Wait for a Rate. Plan for a Payment.

There has been a lot of waiting in the housing market.

Waiting for the Bank of Canada to cut rates.
Waiting for fixed rates to come down.
Waiting for the “right” time to buy.

And sometimes waiting is absolutely the right decision.

But if the main reason you’re waiting is because you expect mortgage rates to be lower later, there’s a question worth asking:

What are you actually waiting for?

The Bank of Canada held its overnight rate at 2.25% on September 2. At the same time, Governor Tiff Macklem noted that the risks of inflation remaining higher than expected have increased, largely because of elevated energy prices and tariffs.

That doesn’t necessarily mean rates are going higher — but it does mean the Bank may have less room to cut.

Could the Bank cut again?

Of course.

But another rate cut is not something I would build a financial plan around.

And there’s another part of the mortgage-rate conversation that I think is important to understand.

The Bank of Canada held. The bond market moved higher.

We often talk about “interest rates” as though there is one rate controlling everything.

There isn’t.

The Bank of Canada’s policy rate has a much more direct influence on prime and variable-rate mortgages.

Fixed mortgage rates are primarily influenced by the bond market, particularly Government of Canada bond yields. Because variable and fixed mortgage rates respond to different benchmarks, they do not necessarily move together. 

We saw that distinction play out around the most recent Bank of Canada announcement.

The five-year Government of Canada benchmark bond yield moved from 3.33% on August 31 to 3.42% on September 2, settling at 3.41% the following day. 

So while the headline said:

Bank of Canada holds rates steady, the market influencing fixed mortgage pricing had actually moved higher.

That doesn’t mean fixed rates are necessarily going to climb significantly from here.

It means something much simpler:

Predicting the next mortgage rate is a difficult thing to build a major financial decision around.

And that got me thinking about the bigger picture.

How much of the mortgage payment story has really been about interest rates?

I recently went back through 21 years of Bank of Canada rate changes and compared them with average GTA home prices and an estimated mortgage payment at the time.

The results were interesting.

In September 2005:

• Prime was 4.50%
• The average GTA home price was approximately $338,000
• The estimated monthly payment was approximately $1,498

At the most recent rate change in October 2025:

• Prime was 4.45%
• The average GTA home price was approximately $1.054 million
• The estimated monthly payment was approximately $4,645

Prime is almost exactly where it was 20 years earlier.

The mortgage payment isn’t.

What changed substantially was the price of the home. 

That is why I think focusing only on the interest rate can sometimes lead us to miss the bigger picture.

Waiting has a cost too — but that doesn’t mean you shouldn’t wait.

This is an important distinction.

I am not suggesting everyone sitting on the sidelines should suddenly go buy a house.

There are plenty of good reasons to wait.

Maybe your income needs to stabilize.

Maybe you need a larger down payment.

Maybe you’re not sure where you want to live.

Maybe the right property simply hasn’t come along.

Or maybe buying doesn’t make financial sense for you today.

Those are all legitimate reasons.

But: Waiting solely because you’re expecting a lower mortgage rate is a different decision.

Because even if the mortgage rate eventually falls, that does not automatically mean the home becomes more affordable.

If the property you want costs more by then, the benefit of a lower rate may be partially — or sometimes completely — offset by the larger mortgage required to buy it.

And the reverse can also happen: prices can soften while rates remain higher.

None of us knows exactly what either rates or home prices will do next.

Which is why I think there is a better question than:

“Should I wait until rates come down?”

Response: Plan for the payment, not the prediction.

Instead, I would look at:

• What can I comfortably afford today?
• What purchase price makes sense for my finances?
• What does the actual monthly payment look like?
• How much flexibility do I want over the next few years?
• How should the mortgage be structured?
• What happens if rates fall?
• What happens if they don’t?
• And does buying today actually support my lifestyle and longer-term goals?

Those are things we can plan around.The next Bank of Canada decision isn’t.

The same applies if your mortgage is coming up for renewal.

Renewal decisions shouldn’t simply be:

“Which lender has the lowest rate today?”

or

“Should I take a short term because rates might fall?”

Term length, penalties, prepayment privileges, cash flow, future plans and the likelihood that you’ll need to make changes to the mortgage can all matter just as much as the rate.

The best mortgage strategy isn’t necessarily the mortgage with the lowest number beside it.

It is the one that makes the most sense for what you are actually trying to accomplish.

Don’t wait for a rate. Plan for a payment.

If you’ve been waiting to purchase, move, refinance or make a decision about an upcoming renewal because you’re trying to time interest rates, I’m happy to revisit the numbers with you.

I won’t tell you that you should buy now. And I won’t automatically tell you to wait.

But we can look at what buying today versus waiting actually means using your numbers — rather than trying to predict what the market will do next.

Sometimes waiting is the right strategy.

Sometimes moving forward is.

The important part is knowing what you’re actually waiting for.

Questions are always welcom

📞 Let’s review your mortgage solutions—it just makes “cents”!

Talk soon,

Ana

Mortgages can be complicated; we are here to help you make “cents” of it.

We focus on Mortgage Solutions, Period!

To learn more connect with Ana Cruz 905.870.0513 or email at ana@askanacruz.ca