Canada’s economy surprised to the upside in the third quarter of 2025, posting 2.6% annualized GDP growth — far stronger than the 0.5% economists expected and a complete turnaround from the tariff-driven contraction earlier in the year.
A Stronger Trade Balance Drove the Recovery
Statistics Canada reports that Q3 growth was fuelled largely by an improved trade position:
Exports increased 0.2%, stabilizing after a steep 7% drop in Q2 when U.S. tariffs hit hardest.
Imports fell 2.2%, the sharpest decline since late 2022.
This shift pushed GDP higher and helped offset weakness elsewhere in the economy.
Government Spending Added Momentum
Another major boost came from higher government capital spending — particularly an 82% jump in spending on weapon systems, which lifted overall public-sector investment and helped drive growth.
Housing Market Activity Picked Up
Despite the rate-sensitive nature of real estate, Q3 showed:
A modest rebound in resale housing,
Countered by a slowdown in new construction activity.
This is consistent with what Lendworth saw across Ontario — more homeowners looking to refinance, consolidate debt, or tap into equity as borrowing costs remain elevated.
But Household Spending Slipped
Not all indicators were positive:
Consumer spending declined, driven largely by fewer vehicle purchases.
Manufacturing inventories grew more slowly, dragging overall GDP slightly.
This softness is part of why many economists expect rate relief in 2026.
September Posted Gains, But October Preliminary Data Looks Soft
StatCan also noted:
September GDP rose 0.2%, stronger than early estimates.
August fell 0.1% due to temporary disruptions like the Air Canada flight attendants strike.
October is tracking at –0.3%, based on early estimates showing weakness in oil and gas, education, and manufacturing.
These figures may be revised due to data gaps tied to the recent U.S. government shutdown that affected customs reporting.
What This Means for Homeowners, Borrowers & Real Estate Investors
The Q3 rebound is encouraging — but the forward outlook remains mixed:
Economic momentum is improving but still uneven
Consumers are cautious
Housing demand is stabilizing
The Bank of Canada’s next rate announcement (Dec. 10) will be closely watched
For many Ontario homeowners, this environment reinforces the growing need for flexible lending options that aren’t tied to rigid bank approval rules.
How Lendworth Helps Borrowers in Shifting Markets
Whether the economy accelerates or slows again, Lendworth provides:
Fast approvals (often within 24–48 hours)
Equity-based lending — not credit-score-based
Home equity loans, first & second mortgages, HELOCs, bridge loans, and refinance solutions across Ontario
As markets adjust, accessing your home equity can be one of the most effective ways to stay financially resilient.