Professionals in a range of sectors across North America are sitting up and taking notice of a new report by MIT’s Project Iceberg, a simulation of the US labour market that found nearly 12% of workforce tasks could be completed by current artificial intelligence (AI) tools.

That model represents about 151 million workers across 923 occupations and over 32,000 skills. Its findings have seen a familiar debate rear its head once more: whether the mortgage industry and brokering profession are under threat from the rapid rise of AI.

The prospect of brokers being replaced by AI remains a distant one. High Iceberg scores were driven mainly by the model’s ability to replicate cognitive work, described by MIT as “financial analysis, administrative coordination, and professional services.”

That might mean backend tasks and administrative duties, rather than the most important day-to-day responsibilities of a frontline broker. And many mortgage pros believe brokers’ ability to produce tailored solutions for a client’s extremely specific needs and contexts is something that will continue to set them apart from automated tools.

Consider a homebuyer with a sizeable down payment. One option might be to use that money to pay off debt, take on a larger mortgage, but reduce monthly liabilities and get into the housing market now instead of waiting. That’s the kind of complex trade-off not many buyers would feel comfortable entrusting to an AI model.

“I feel like this is where the real humans are going to survive over the AI tools,” Sharon Davis a Vancouver-based broker, told Canadian Mortgage Professional. “AI doesn’t think that way. AI doesn’t say, ‘Well, let’s look at everything.’”

Some Canadians still uneasy with AI-driven mortgages

For most Canadians entering the housing market, a home purchase is one of the biggest investments they’ll ever make. Trusting a computerized model with a transaction totalling hundreds of thousands of dollars isn’t a decision many would take lightly, and plenty would still prefer to place that trust in a human.

While younger, more tech-savvy buyers might be more comfortable with an AI-fuelled mortgage, the prominence of the so-called “Bank of Mom and Dad” in today’s mortgage market also suggests human involvement will still be important.

“Thirty-year-olds who have all their own money and are making all their own decisions are super-techie,” Davis said. “But their parents, if they’re giving them any sort of money, want to know: ‘What are you dealing with? Are you dealing with a bank?’ Or ‘I want to talk to that person.’”

The pros and cons of AI in mortgages

Digital mortgage lender nesto spelled out some of the drawbacks potentially associated with AI in the mortgage sector in a recent blog post – including a potential lack of deeper understanding of borrower profiles, possible miscommunication without human support, and the risk of unintentional exclusion of applicants because of strict criteria used by an algorithm.

On the flipside, it could also enable 24/7 interaction with borrowers, minimize human error in data entry, clear manual paperwork, and enhance fraud detection with pattern recognition.

Of course, brokers are well aware that staying up to speed with technological advancements is essential to keeping up pace with the competition – and that means embracing AI and some of the ways it can automate or accelerate tasks.

Striking that balance can be difficult, but Davis said it’s one that’s important for every mortgage professional as they map a path forward in the industry amid a time of rapid change.

“I feel like there’s definitely still a lot of space for the human touch and for brokers that are not using the combo [of AI mixed with their own approach], they’re cutting out a huge segment that still wants them,” she said.

“We have to be a hybrid. We need AI to keep us moving forward and help us be more efficient.”

Published by Fergal McAlinden of Canadian Mortgage Professionals Magazine

People hunting for homes and mortgages have had a lot of economic and market news coming their way lately. Probably the most significant is the Bank of Canada’s decision to lower its policy rate.

As expected, the central bank trimmed a quarter of a point off its trendsetting interest rate, bring it to 2.50%. It is the first rate move since March.

The cut came a day after Statistics Canada reported the inflation rate rose to 1.9% in August, up from 1.7% in July.

Normally rising inflation would be a reason for the Bank not to lower its rate, due to concerns about over stimulating the economy and encouraging even more inflation. However, the Bank noted that other factors – such as stable (although higher than desired) core inflation, a decline in the gross domestic product and an increase in unemployment – indicate inflation is not a high risk.

The interest rate cut could make variable-rate mortgages look more attractive for those who are comfortable with potential rate movement.

The Canadian Real Estate Association reports August home sales increased 1.1% compared to July and were almost 2.0% better than a year earlier. The MLS Home Price Index showed flat pricing month-over-month, but registered a 3.4% decline year-over-year. CREA’s national average price was $664,000 in August 2025, up 1.8% from August 2024.

August new listings were up 2.6% over July and up 8.8% over a year earlier.

Published by First National Financial LP

Canada’s latest employment report has significantly increased the likelihood of an interest rate cut by the Bank of Canada on September 17.

Statistics Canada’s Labour Force Survey (LFS) for August shows a loss of nearly 66,000 jobs for the month. That follows a drop of 41,000 positions in July. The August unemployment rate stands at 7.1%, up from 6.9% a month earlier.

Looking back to June, the Survey of Employment, Hours and Payroll (SEPH) – which is considered more reliable than the Labour Force Survey (LFS) – shows more than 32,000 jobs were lost; a significant reversal from initial reports of 83,000 jobs added for the month.

Most of the August loses came in part-time positions but had an inordinate impact on workers aged 25 to 54, which is an important demographic in the first-time homebuyer market. On-going trade trouble with the United States is getting the blame.

Employment plays an important role in the Bank of Canada’s interest rate decisions. Market watchers now say there is a better than 80% chance the Bank will cut its policy rate later this month. However, inflation is still the key factor.

“All told, this weak report fully reinforces any bias for the BoC to ease somewhat further here, but inflation hasn’t quite given them the all-clear,” wrote bank economist Douglas Porter in a newsletter.

The next inflation report is due September 16, one day before the Bank of Canada’s next interest rate setting.

Published by First National Financial LP

The Bank of Canada’s next interest rate announcement is set for September 17.  Between now and then there will be plenty of economic data to digest.

The latest significant report was Statistics Canada’s July employment reading, which surprised most analysts with a drop of nearly 41,000 jobs.  Most of those positions were full-time.  The unemployment rate was unchanged at 6.9%.

Expectations had been for an increase of 13,500 jobs.

Well known Canadian economist Douglas Porter referred to the report as “unambiguously weak”, especially in light of the June employment report that showed 83,000 new jobs were created.

Some analysts feel this increases the likelihood of a Bank of Canada Policy Rate cut in September.  They put the chances at 40%.  However, Porter and many other economists do not expect July’s sudden jobs decline to change the central bank’s current stance on interest rates.

“[The Bank] will still need to see inflation slow notably over the next two prints for a September cut to be a high likelihood. We expect that the job market slack will put downward pressure on inflation, eventually, supporting the case for a return to modest rate cuts. And it appears that the trade uncertainty will be with us for some time yet,” Porter wrote in a client note.

The central bank has held its trend-setting Policy Rate at 2.75% since March.

Published by First National Financial LP