Let’s talk about the real impact of interest rate cuts on home affordability in Canada—because it’s not as simple as cheaper borrowing means easier buying. Recent research from central bank economists found that when rates go down, housing demand jumps quickly, but the supply side takes much longer to catch up. For example, after a rate cut, home resales start to rise almost right away, with the full effect visible 18–24 months later. But new housing starts? Those usually begin to climb only about two years down the line, once builders see higher prices and better financing—plus, the planning and permitting process (especially for condos and multi-unit buildings) is never quick.
Strong job markets can supercharge this, because when families feel confident in their finances and lending is easier, they’re ready to move. I see this every day in Brampton, whether it’s first-time buyers eager to get started or move-up families chasing that next chapter. But the reality is, even with lower rates, if supply doesn’t keep pace with demand, affordability remains a big challenge. The research makes it clear: monetary policy can help spark activity, but it’s not the magic fix for affordability in our market. As always, understanding both the numbers and the neighbourhoods is key to making your next move with confidence.
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