RSS

Special Notice: Bank of Canada Cuts Rates by 50bps—A Rare Opportunity

Special Notice: Bank of Canada Cuts Rates by 50bps—A Rare Opportunity

Bank of Canada’s Latest 50bps Rate Cut: What It Means for You

Today, the Bank of Canada lowered its overnight rate by 50 basis points, dropping it from 4.25% to 3.75%. This marks the fourth consecutive rate cut in 2024, signaling a focused effort to stimulate economic activity as inflation pressures ease—particularly in shelter costs and fuel prices.

The Bank first began cutting rates in June 2024, when the overnight rate fell from 5.00% to 4.75%. Since then, momentum has been building, with each cut creating new opportunities for buyers and sellers alike. History shows that the most strategic buyers secure the best deals before year-end, making this a pivotal moment to position yourself ahead of the market. Whether you're buying, selling, or simply watching the market, understanding these shifts could help you make the most of the opportunity.


How This Rate Cut Impacts You

Lower rates mean lower borrowing costs—giving buyers more flexibility. Here's how the 1.25% reduction in rates translates to monthly savings on mortgage payments over a 25-year amortization:

  • $250,000 mortgage – Save $176 per month

  • $500,000 mortgage – Save $352 per month

  • $750,000 mortgage – Save $528 per month

  • $1,000,000 mortgage – Save $705 per month

This affordability shift opens two key opportunities:

  1. Lower monthly payments, easing the burden of homeownership.

  2. Higher loan approvals, expanding your options and making it easier to secure your ideal property.


Your New Borrowing Power

For those previously approved at the higher rate, here’s what you can now approximately qualify for:

  • $250,000 mortgage → Now: $285,200 - $288,720

  • $500,000 mortgage → Now: $570,400 - $577,440

  • $750,000 mortgage → Now: $855,600 - $866,160

  • $1,000,000 mortgage → Now: $1,141,000 - $1,155,100

These adjustments mean greater purchasing power, opening doors to homes that may have been previously out of reach.


Why This Moment Could Be Perfect to Act

For buyers and sellers, timing can be everything. Over the past two years, the best deals in Victoria, Cowichan, and Nanaimo have consistently emerged between October and January. During this period, sellers tend to be more motivated to close deals before year-end, giving buyers an edge in negotiations.

The recent rate cuts open a window of opportunity for buyers to secure lower payments before the inevitable spring surge. Those who act now, while others hesitate on the sidelines, will position themselves to gain the upper hand when the market swings back into full gear.


Take Action Before the Market Shifts

This is the kind of moment where acting sooner can make all the difference. If you’ve been considering buying a home, now could be the right time to start your search. With the rate cuts creating favorable conditions and sellers motivated to close before the new year, the opportunity to secure a great deal has rarely been better.

🔍 Start Your Home Search

Search like a Realtor with our advanced search tool for full, realtor-level access to listings. Discover homes across Victoria, Cowichan, and Nanaimo tailored to your preferences.


Final Thoughts

In times of change, hesitation can lead to missed opportunities. As the Bank of Canada continues to ease rates, the window for favorable deals may close quickly. Our team is here to help you navigate these shifts, ensuring you find the best property to meet your goals.

If you have questions or want to discuss your next steps, don’t hesitate to reach out. We’re here to help you take advantage of the current market conditions and make an informed decision.

MLS® property information is provided under copyright© by the Vancouver Island Real Estate Board and Victoria Real Estate Board. The information is from sources deemed reliable, but should not be relied upon without independent verification.