Interest rates are falling in Canada, but what does it mean for housing and mortgages?
The Bank of Canada's recent interest rate cut, the first in over four years, might not alleviate concerns about housing affordability, according to a new Ipsos poll conducted for Global News.Â
Many prospective homebuyers still feel sidelined by high borrowing costs, with 63% indicating they will remain on the sidelines. Among those who don't own a home, 45% believe they won't be able to afford one regardless of rate cuts.
However, there's a slight decrease in the perception that homeownership is only for the rich, with 78% of respondents expressing this view compared to 80% in April. Despite some optimism fueled by the rate cut cycle, 62% of respondents have given up on owning a home, down from 72% in April.
The rate cut is seen as a positive step, but more cuts may be needed to stimulate transactions and improve affordability. Younger homeowners, especially those aged 18-34, are particularly concerned about holding onto their homes due to high mortgage rates. If they were to renew or get a new mortgage this year, two-thirds of Canadians with a mortgage would choose a fixed rate. The Bank of Canada's next interest rate decision is scheduled for July 24.
