Weekly Market Pulse

I’ve reviewed the full slate of weekly data, rates, spreads, housing activity, and equity signals, and here’s what caught my attention. The market continues to show a controlled adjustment rather than any broad dislocation. Capital is repricing at the margins, not retreating, and the implications for real estate are subtle but important. These are the same data points I review every week, but the interplay between rates and supply is becoming more decisive.

Featured Metric Deep Dive, Yield Levels and Real Estate Math

This week I’m focusing on government bond yields as the featured metric, because they quietly anchor almost every underwriting assumption I make. The Canada 5-year government yield is sitting near 3.01 percent, while the 10-year is approximately 3.45 percent. Both have drifted higher over the past three months, but the move has been gradual rather than abrupt.

Let me explain why this matters. A 25 basis point increase in the risk-free rate typically flows through to mortgage pricing, which then compresses leverage or cash flow. On a $10 million acquisition financed at 65 percent loan to value, that quarter-point translates into roughly $16,000 to $18,000 of additional annual debt service. To offset that purely through operations, a property generating $750,000 of NOI needs either a 2.5 percent rent increase or a similar reduction in expenses. This is why small yield movements matter far more than headlines, especially when underwriting multi-year holds.

Yield Curve Analysis

The yield curve remains positively sloped, with short rates anchored and the long end carrying more of the adjustment. The Canada 3-year yield is around 2.76 percent, while the 7-year is closer to 3.22 percent, and the 20-year sits near 3.79 percent. The curve is no longer flattening, but it is not steepening aggressively either. This configuration typically signals modest growth expectations combined with persistent inflation sensitivity. From my perspective, this argues for conservatism on exit cap rates while remaining constructive on long-term rental demand.

Current Financing Environment

Financing conditions continue to reflect this balanced environment. CMHC-insured 5-year fixed rates remain around 3.99 percent, unchanged week over week and still compelling relative to historical averages. Uninsured multi-unit fixed rates are holding near 4.49 percent, while adjustable-rate structures remain priced off CORRA, which is sitting near 2.25 percent. Canada Mortgage Bond yields have edged higher, with the 5-year around 3.12 percent and the 10-year near 3.64 percent. Lenders are open for business, but they are clearly prioritizing asset quality, sponsor strength, and realistic rent assumptions.

Market Signals

The Bank of Canada policy rate remains at 2.25 percent, and prime is steady at 4.45 percent, keeping short-term borrowing costs elevated but predictable. Housing starts are one of the more important signals I’m watching closely. CMHC total housing starts are currently running at 254,058 units. Month over month activity is flat, while the three and six month trends are both up approximately 9.1 percent, and the twelve month comparison remains down 3.2 percent. This tells me supply is not accelerating in a way that would materially pressure rents in the near term. Developers appear disciplined, which is supportive for existing rental stock.

My Strategic Positioning

• I’m looking to underwrite acquisitions with conservative exit assumptions, focusing on cash flow resilience rather than multiple expansion

• I’m favoring fixed-rate financing where possible to lock in certainty during this phase of rate normalization

• I’m continuing to monitor supply pipelines closely, particularly in submarkets with sustained population growth

Based on these indicators, here’s what I’m intending to do, stay patient, remain selective, and allow incremental opportunities to surface rather than forcing deployment.

Macro Context

Equity markets are providing a constructive backdrop. The TSX is trading around 31,869, while the S&P 500 sits near 6,878, both well above their levels from a year ago. Volatility has picked up, with the MOVE index pushing above 62, but this has not translated into stress in credit markets. Energy prices remain moderate, with crude around $57 per barrel, which continues to support consumer spending without reigniting inflation fears. It is important never to look at real estate in isolation, and these broader signals reinforce a stable demand environment for rental housing.

Bottom Line

The data continues to support a disciplined, fundamentals-driven approach. Rates are higher than their lows but stable, supply growth remains controlled, and macro conditions are broadly supportive of rental demand. The risk lies in overreacting to marginal rate movements, while the opportunity lies in understanding how these conditions compound over time. For me, this is a market that rewards patience, precision, and restraint.

Important Disclosures

This analysis is provided for informational and educational purposes only and does not constitute investment advice, financial advice, trading advice, or any other sort of advice. The content represents my personal views and analysis of market conditions as of November 24, 2025, and should not be construed as a recommendation to buy, sell, or hold any particular investment or security. Past performance is not indicative of future results. Real estate investments involve substantial risk, including but not limited to: market risk, interest rate risk, liquidity risk, leverage risk, and the potential for total loss of capital. Market conditions, interest rates, government policies, and economic factors can change rapidly and materially affect investment outcomes. The interest rates, spreads, and market data referenced herein are subject to change without notice and may not reflect the rates or terms available to all investors. Actual financing terms will vary based on individual creditworthiness, property characteristics, loan-to-value ratios, and lender-specific underwriting criteria.

All investors should conduct their own due diligence and consult with qualified legal, tax, and financial advisors before making any investment decisions. This content does not take into account your specific investment objectives, financial situation, or particular needs. No warranty or guarantee is provided regarding the accuracy, completeness, or timeliness of the information presented. While data sources are believed to be reliable, errors and omissions may occur. Market data and economic indicators are subject to revision. Real estate investments are illiquid and may not be suitable for all investors. Leverage amplifies both gains and losses. Forward-looking statements and market predictions are speculative in nature and involve known and unknown risks and uncertainties.