Canada: Rate Cuts Can Worsen Affordability | I help wonderful people buy & sell great homes – its an honour when you refer your family, friends and neighbours!

There’s a common belief that cutting interest rates will quickly make homes more affordable, but the latest research from Canada’s central bank paints a more nuanced picture. Lower rates do spark a surge in housing demand—often within just a few months—and resales typically see their full boost within 18 to 24 months. But the supply side of the equation moves much more slowly: housing starts only begin to pick up about two years after the initial rate cuts. Strong job markets make this effect even more pronounced, since people feel more secure and lending gets easier, encouraging faster buying. Builders eventually respond, but getting new homes—especially multi-unit buildings—from blueprint to move-in takes time. So while lower rates can eventually help add supply, demand always gets a head start, which means rate cuts alone don’t solve affordability challenges. For anyone moving, buying, or selling in this environment, my approach remains the same: honest, straightforward guidance rooted in years of local experience and a genuine commitment to your next chapter. Let’s navigate these complexities together, keeping your goals—and your family’s future—at the center of every decision.