Permanent Financing
Understand permanent financing in Canadian real estate — what it is, when it applies, and how it supports completed projects.
August 01, 2025
What is Permanent Financing?
Permanent financing is long-term financing used to replace short-term construction or bridge loans once a property is completed and stabilized.
Why Permanent Financing Matters in Real Estate
In Canadian real estate, permanent financing provides developers and owners with predictable, long-term debt after project completion.
Key points:
- Typically a mortgage with fixed or floating rates
- Secured once occupancy and cash flow targets are met
- May be provided by banks, insurance companies, or CMHC
Understanding permanent financing helps developers plan exit strategies from construction financing.
Example of Permanent Financing in Action
The apartment building transitioned from its construction loan to permanent financing after achieving 95% occupancy.
Key Takeaways
- Replaces short-term construction or bridge loans
- Provides long-term financial stability
- Secured once property is stabilized
- May involve fixed or variable rates
- Key milestone in project lifecycle
Related Terms
- Construction Loan
- Bridge Financing
- Draw Schedule
- Mortgage Term
- Public-Private Partnership
National average resale-price growth and housing-starts growth, smoothed over three months. The comparison illustrates the cycle; it does not establish how much a price change causes construction to change.
Trailing 12-month starts in centres of 50,000 or more remove the usual monthly seasonality. Ownership combines the homeowner and condominium categories; rental is shown separately.
Six-month averages of provincial starts, expressed at annual rates. The smoothing reduces the influence of individual apartment projects.
The same August benchmark compared with two different starting points. Three-month changes are not annualized.
Average sale prices show the difference in purchase costs across markets. They do not measure affordability relative to local incomes or construction costs.
Newfoundland and Labrador remains above its pre-pandemic sales pattern, but August activity was below last year. Historical lines retain their original release vintages.
Average and median describe different aspects of the same month’s transactions. Both are affected by the mix of homes sold.
Category averages compare different homes and locations; the gaps are not estimates of the cost to upgrade an otherwise identical property.
The five categories shown account for 5,000 of the board’s 5,057 sales. The remaining 57 transactions were in other housing categories.
Monthly observations are not seasonally adjusted. Active listings count properties available at month-end; they are not construction inventory.
Average and median prices share one dollar axis. These unadjusted transaction measures do not control for changes in the homes sold.
TRREB’s 416/905 categories compare the apartments sold in each area. The difference does not isolate a location premium for equivalent units.
5680 Oak Street in Vancouver and its surrounding context. (MCMP Architects)
Ground-level renderings of the tower proposed for 5680 Oak Street in Vancouver. (MCMP Architects)
