On April 16, 2025, the Bank of Canada announced that it would hold its key interest rate steady at 2.75% — after a series of rate cuts that began in June 2024. But what does this mean if you’re planning to buy or sell a home this year? Let’s break it down!
What This Means for Home Buyers
If you're looking to purchase a home, the decision to keep rates unchanged means:
Mortgage Rates Stay Stable. Because the central bank didn’t cut rates, lenders will likely keep mortgage rates where they are for now — especially for variable-rate mortgages. Fixed-rate mortgages depend more on bond markets, but overall, rates won’t be dropping just yet.
No Big Rush — But Keep Watching. The Bank of Canada hinted that if the economy slows, it might lower rates later this year. That could make mortgages cheaper, so if you’re not in a hurry, waiting could save you money.
Home Prices May Stay Balanced. Interest rates directly affect buyer demand. Since rates aren’t dropping, prices are unlikely to spike or plummet in the short term. This gives buyers some breathing room to shop without the pressure of bidding wars.
What This Means for Home Sellers
If you're planning to sell, the steady rate has its own meaning:
Buyer Demand Stays Stable. Higher borrowing costs have cooled the market, but the fact that rates are holding steady means buyers are still active — just more cautious and selective.
Selling Now vs. Later. If you’re flexible on timing, waiting for a potential rate cut later this year could bring more buyers to the market, potentially helping you sell faster and for a stronger price. But well-priced and well-presented homes are still selling, even now.
Price Matters More Than Ever. In this balanced environment, homes need to be competitively priced and professionally marketed to attract serious buyers. Overpricing could mean sitting on the market longer than expected.
What is a Balanced Market?
A lot of people are asking: what does "balanced market" mean?
A balanced market happens when the number of buyers and sellers is roughly equal. Neither side has a major advantage, so homes tend to sell for fair prices and negotiations are common.
Market Type:
Buyer’s Market — Buyers More homes for sale, lower prices, room to negotiate.
Seller’s Market — Sellers High demand, fewer listings, faster sales, bidding wars.
Balanced Market — Both Fair pricing, steady pace, healthy negotiations.
Right now, the Canadian market leans toward balanced — meaning realistic expectations are key for both buyers and sellers.
The Bank of Canada is playing it safe as global trade tensions and economic uncertainty unfold. Whether you’re planning to buy or sell, understanding these rate decisions can help you time your move wisely.
If you're curious about what this means for you — we’d be happy to give you a custom breakdown. Just reach out!