Ottawa's real estate market is a standout performer throughout the year, and here's why:

Steady Economic Growth

Ottawa’s economy benefits from key sectors like government, technology, and education. As the nation’s capital, it attracts government jobs, tech professionals from companies like Shopify, and students from local universities, driving consistent housing demand.

Diverse Housing Options

With options ranging from historic homes in The Glebe to modern condos in Downtown, Ottawa caters to all preferences and budgets. This diversity means both buyers and sellers can find what they're looking for, whether it’s a first home or an investment property.

Strong Rental Market

Ottawa’s rental market remains strong, supported by students, government employees, and tech workers. This steady demand is great for investors seeking reliable returns and for buyers who may want to rent before purchasing.

Quality of Life

High quality of life in Ottawa, including its clean environment, excellent healthcare, and abundant green spaces, makes it a desirable place to live and invest. This appeal keeps the market active and attractive for both buyers and sellers.

Market Trends and Timing

While Ottawa’s market has seasonal variations, its underlying stability offers year-round opportunities. Sellers can benefit from understanding market timing and maintaining their homes, while buyers should stay informed to seize the right moment.

In conclusion, Ottawa’s thriving real estate market offers benefits for both buyers and sellers. Its economic stability, diverse options, strong rental market, and high quality of life create a vibrant landscape for making informed real estate decisions.

For personalized advice and insights, contact us today!

The Bank of Canada today lowered its target for the overnight rate to 4.25%, with the Bank Rate set at 4.5% and the deposit rate at 4.25%. The Bank continues its policy of balance sheet normalization.

Globally, the economy grew by approximately 2.5% in the second quarter, in line with forecasts from the Bank's July Monetary Policy Report (MPR). Economic growth in the United States exceeded expectations, driven by consumer spending, though the labor market has slowed. Growth in the euro area was supported by tourism and services, while manufacturing lagged. Inflation in both regions is easing. In China, weak domestic demand has hindered economic growth. Since July, global financial conditions have further relaxed, with bond yields decreasing. The Canadian dollar has seen a modest appreciation, largely due to a weaker US dollar. Oil prices are lower than projected in the July MPR.

In Canada, the economy expanded by 2.1% in the second quarter, primarily due to government spending and business investment. This growth was slightly above the July forecast, though early indicators suggest weaker economic activity through June and July. The labor market remains sluggish, with minimal employment changes in recent months, although wage growth continues to outpace productivity.

As expected, inflation fell to 2.5% in July. The Bank's preferred measures of core inflation averaged around 2.5%, and the percentage of consumer price index components rising above 3% is now close to historical levels. High shelter price inflation remains the largest contributor to overall inflation but is beginning to ease. Inflation in certain services also remains elevated.

Given the ongoing reduction in inflationary pressures, the Governing Council decided to lower the policy interest rate by another 25 basis points. Excess supply in the economy continues to push inflation downward, while rising prices in shelter and some services are keeping inflation elevated. The Governing Council is closely monitoring these opposing forces. Future monetary policy decisions will be based on incoming data and their impact on inflation forecasts. The Bank remains committed to restoring price stability for Canadians.

Source:www.BankofCanada.ca

Curb appeal refers to the visual attractiveness and overall charm of a property's exterior. It includes elements like landscaping, architectural details, cleanliness, maintenance, and design features, all of which shape the first impression that potential buyers or visitors will have of the home.

With each changing season, it's an opportunity to refresh your home's outdoor space. Whether you're preparing to sell or simply take pride in your well-maintained home, there are several easy ways to enhance your home's exterior this summer.

Here are five effective strategies to boost your curb appeal:

1. Revamp the Driveway Your driveway is one of the first things noticed upon arrival, making it crucial for curb appeal. Start by pressure washing to remove dirt and debris. If you find any cracks or loose stones, repair or replace them as needed. For a fresh look and added protection, consider sealing the driveway.

Adding a rock garden or hedge can enhance the visual appeal, providing a natural and attractive border that complements your landscaping.

2. Tend to Your Lawn and Gardens An overgrown lawn and weed-filled garden can be off-putting. Improve your lawn by seeding, fertilizing, and aerating, and ensure it's adequately watered. Refresh garden beds with new mulch and plants. If starting anew, use landscaping fabric to keep weeds at bay while allowing water and air to nourish the soil.

3. Enhance Your Front Entrance Your front entryway sets the tone for your home. Start by cleaning the area, fixing any damage, and replacing burnt-out light bulbs. Paint your front door a vibrant color to brighten the facade and protect it from the elements. Add decorative touches such as hanging or potted plants, comfortable seating, and a seasonal wreath to create a warm and inviting entrance.

4. Update Your Deck and Patio Clean your patio and deck with a pressure washer and apply a fresh coat of protective stain to the deck. Remove weeds between patio stones and consider cleaning the siding and windows while you're at it. Refresh or replace weathered patio furniture and arrange it for optimal enjoyment.

Add potted plants to your deck or patio for added privacy and aesthetics. Large plants can act as a barrier from neighbors while also attracting beneficial wildlife like bees, birds, and butterflies.

5. Upgrade Your Lighting Outdoor lighting can dramatically enhance your home's appearance after dark. Install pot lights under the eaves to illuminate the exterior and create a grand effect. Solar-powered lights along the driveway or walkway provide both functionality and a welcoming ambiance. If space allows, add a pendant light to the front porch for a cozy touch. Lanterns or string lights can transform your patio, deck, or backyard into a charming space for relaxation and entertaining.

By making these updates, you can significantly boost your home's curb appeal. Even small changes can make a big difference, helping to create a welcoming and visually appealing exterior that reflects your personal style and pride in your home.

The Ottawa real estate market showed signs of growth in July 2024, with 1,241 homes sold through the MLS® System of the Ottawa Real Estate Board (OREB). This represents a 13.6% increase compared to July 2023.

However, home sales were still 7.1% below the five-year average and 8.8% below the 10-year average for July. Despite this, year-to-date sales figures were encouraging, with 8,349 units sold by July 2024, marking a 5.5% increase from the same period in 2023.

The market’s performance is a positive signal amidst the usual summer slowdown, reflecting growing buyer confidence and a steady stream of new listings. Recent policy changes, including interest rate cuts and extended mortgage amortization periods for first-time buyers, could further support the market, though supply challenges remain.

Price Trends

The MLS® Home Price Index (HPI) provides a detailed view of price trends:

The overall MLS® HPI composite benchmark price in July 2024 was $648,900, up slightly by 0.1% from July 2023.

Single-family homes had a benchmark price of $734,700, down 0.1% year-over-year.

Townhouse/row units saw a benchmark price of $506,100, an increase of 3.4% compared to last year.

The benchmark price for apartments was $422,800, a decrease of 0.9% from July 2023 levels.

The average price of homes sold in July 2024 stood at $679,610, reflecting a 2.1% decrease from July 2023. The year-to-date average price, however, showed a slight increase of 1.0%, reaching $681,082. The total dollar volume of home sales in July 2024 was $843.3 million, an 11.3% increase from July 2023.

Inventory and New Listings

New residential listings in July 2024 increased by 17.1% from the previous year, totaling 2,231 new listings. Active residential listings at the end of July 2024 numbered 3,480 units, a substantial 37.0% increase from July 2023. The months of inventory, which indicates how long it would take to sell current listings at the current sales pace, rose to 2.8 months, up from 2.3 months in July 2023.

These statistics reflect a market that is gaining momentum, with increasing buyer activity and a growing inventory, although challenges around supply and affordability persist.

Source: Ottawa Real Estate Board

Do you often find yourself browsing listings and dreaming about your next move? If so, it’s essential to look beyond listing prices and down payments. Whether you're looking to upgrade or make your first investment, it's crucial to consider various financial aspects before buying a home. Here are some key expenses to factor into your decision:

Utilities

Upgrading to a larger home or one with older, less efficient appliances can significantly impact your utility costs. It's important to estimate these additional expenses accurately. Consider the size of the home, the age and efficiency of the heating, cooling, and water systems, and any additional appliances that might come with the property. Add these estimated costs to your current monthly budget to see how a move might affect your overall spending. Doing this will help you avoid any surprises when your first utility bill arrives after the move.

Mortgage Penalty

Breaking your current mortgage term early might come with a penalty, which is usually around three months' worth of interest. However, this amount can vary depending on your lender and the terms of your mortgage. It's crucial to read the fine print of your mortgage agreement and understand the penalties for early repayment or refinancing. In some cases, negotiating with your lender for a lower penalty or even exploring the possibility of porting your mortgage to the new property might be beneficial. Always consult with your financial advisor to understand the best course of action.

Moving Costs

Moving is never just about transporting your belongings from one place to another. There are numerous additional expenses to consider. If you plan to hire professional movers, get quotes from multiple companies and check for any hidden fees, such as charges for moving large items or extra insurance. If you opt for a DIY move, factor in the cost of renting a moving truck, fuel, and possibly temporary storage. Don’t forget smaller costs like packing materials or even throwing a pizza party to thank friends who help you move. If your schedule allows, consider moving during the off-peak season when costs tend to be lower.

Legal Fees

Hiring a trusted real estate lawyer is essential to ensure that all the legal aspects of your home purchase are handled correctly. Legal fees can vary widely, so it’s important to understand what services are included in the fee structure. These services typically include reviewing the purchase agreement, conducting a title search, handling the transfer of funds, and registering the new property with the local land registry office. Always get a detailed breakdown of the estimated costs and confirm these with your lawyer before you sign any offers. This will help you avoid any unexpected charges at closing.

Additional Considerations

Beyond these primary expenses, there are other costs to consider when buying a home. These might include home inspection fees, property taxes, insurance, and potential renovations or repairs needed immediately after purchase. A thorough home inspection can reveal issues that might not be apparent during a regular viewing and can give you leverage in negotiating the purchase price or requesting repairs before closing.

By carefully considering all these financial aspects, you can make a well-informed decision and ensure that your dream move doesn't turn into a financial nightmare. Planning ahead and budgeting for these expenses will help you transition smoothly into your new home and enjoy it from day one.

Ready to dive deeper into the home-buying process? Visit our latest blog for comprehensive tips and insights to guide you every step of the way. Contact us to ensure you're well-prepared for a successful move by uncovering all potential hidden costs!

Get ready for an incredible weekend in Ottawa! From fireworks to buskers, ribs, and poutine, there's something for everyone. Check out this list of events and share it with your friends. Know of any other events? Share them in the comments!

12 Must-See Events in Ottawa

Casino Lac-Leamy Fireworks Experience world-class pyromusical performances, culinary delights, artistic showcases, and multimedia art installations. Tickets start at $16. Watch from various points along the Ottawa shoreline, including Major’s Hill Park. Fireworks at 9:15pm.

When: July 31 and Aug 3, 7, 10, 14, 17
Where: Canadian Museum of History grounds, Laurier St, Gatineau
Details:feux.qc.ca

Ottawa International Buskerfest Enjoy world-class performances, free workshops, strolling acts, and food vendors. Free entry.

When: August 2-5
Where: Sparks St
Details: ottawabuskerfestival.com

Capital Ribfest & Poutine Savor the best ribs and poutine, along with live music, games, and drinks. Free entry.

When: August 2-5, 12-9pm (Mon, 12-6pm)
Where: City Hall, 110 Laurier St W
Details: capitalribfest.ca

Ottawa Chamberfest The largest and one of the oldest chamber music festivals in the world celebrates its 30th anniversary. Enjoy free and paid concerts in beautiful venues.

When: July 25-Aug 8
Where: Various venues
Details: chamberfest.com

Capital Pop Up Cinema Watch a free outdoor screening of "The Wedding Singer." Approx. 8:45pm.

When: Friday, Aug 2
Where: Beachwood Cemetery, 280 Beechwood Ave
Details: IG @capitalpopupcinema

613 Flea Shop from over 150 vendors offering eclectic goods, handmade items, antiques, vintage clothing, food, and more. Free entry.

When: Saturday, Aug 3, 10am-4pm
Where: Aberdeen Pavilion, Lansdowne Park, 1015 Bank St
Details: @613flea

Atletico Ottawa vs Cavalry FC Support Ottawa’s professional soccer team against Cavalry FC from Calgary.

When: Saturday, Aug 3, 7pm
Where: TD Place, 1015 Bank St

Colonel By Days Explore Ottawa’s rich history and the canal builder’s legacy with live tours, period costumes, and workshops. Free entry.

When: Saturday, Aug 3-Monday, Aug 5, various times
Where: Ottawa Locks Bytown Museum, 1 Canal Lane, Ottawa
Details: ottawamuseumnetwork.ca

Open Doors at Rideau Hall Tour the grounds, state rooms, gardens, and greenhouses of the Governor General's residence. Free entry.

When: Saturday, Aug 3-Monday, Aug 5, 10am-4pm
Where: Rideau Hall, 1 Sussex Dr, Ottawa
Details: gg.ca

Company of Fools: Macbeth Enjoy Shakespeare’s Macbeth with an all-female/non-binary cast. Pay-what-you-can ($20 suggested).

When: Friday, Aug 2-Monday, Aug 5 (and beyond), 7pm-8:30pm
Where: Aug 2nd Alexander Grove (Stittsville), Aug 3rd Fairmont Park (Civic Hospital), Aug 5th Strathcona Park (Sandy Hill)
Details: fools.ca

Glengarry Highland Games Experience Scottish heritage with over 60 pipe bands, 200 Highland dancers, and traditional sports. Tickets: $30 (children 12 and under free).

When: Friday, Aug 2, 8am-2am; Saturday, Aug 3, 8am-10pm
Where: 34 Fair St, Maxville
Details: glengarryhighlandgames.com

Festival Country du Grand Gatineau Celebrate the 32nd edition of the Grand Gatineau Country Festival with performances by over 40 country music artists. Tickets: $26.85 & up.

When: Aug 1-4; Friday from 7pm, other days from 1pm
Where: Father Arthur Guertin Center, 16 Rue Bériault, Gatineau
Details: countrygatineau.com

Saturday

Crush: The Bon Jovi Experience Enjoy Bon Jovi's greatest hits with Crush. Tickets: $25.57-$31.59 incl tax.
When: Saturday, Aug 3, 8pm-11pm
Where: Rideau Carleton Casino, 4837 Albion Road

Major League Quad Watch the Ottawa Black Bears face the Boston Forge in the 2024 MLQ finale. Pay-what-you-can (min. $5).
When: Saturday, Aug 3, 2pm-5pm
Where: 140 Main St, Ottawa
Details: mlquadball.ticketleap.com

Urban Art Collective Saturday Themed Markets Discover unique treasures at the Antique & Vintage Market. Free entry.
When: Saturday, Aug 3, 12pm-5pm
Where: 1088 Somerset St. W, Ottawa

Sunday

Salsa Sundays Join this free weekly dance class led by instructors from the University of Ottawa’s Salsa Club. No partner is needed, and the instructors will have you dancing with Latin flair in no time! Every Sunday from June 9 to September 1, 3pm to 5pm at George Street Plaza, 55 Byward Market Square.

Zumba on the Hill Get your groove on at Parliament Hill with certified Zumba instructors. This lively Zumba Party is free to attend. Sundays from 4pm to 5:15pm. Location: Parliament Hill. Details: Zumba on the Hill Facebook

Lansdowne Market Explore over 75 vendors offering a variety of local produce, baked goods, crafts, hot meals, and more. Pets are welcome. Every Sunday from 9am to 3pm at the Aberdeen Pavilion, 1000 Exhibition Way, Ottawa.

Monday

Bring the Kids! Enjoy a classic and chamber music recital at the National Arts Centre, designed to keep kids engaged with short attention spans. Free admission. Monday, August 5 at 12pm. Location: 1 Elgin Street, Ottawa, ON K1P.

Meet & Greet with Sesame Street Meet Elmo, Abby, and the Cookie Monster at Tanger Outlet. Enjoy face painting, games, and treats with your little ones. Free event. Monday, August 5 from 11am to 3pm. Location: 8555 Campeau Drive, Ottawa.

Source: Ottawaisnotboring.com

First-time buyers of new construction homes in Canada can now access longer mortgage amortization periods.

Effective August 1st, 2024, lenders can offer 30-year amortizations for insured mortgages to first-time homebuyers of new construction homes, following a modification by the federal government. Previously, the maximum amortization for an insured mortgage—one requiring mortgage insurance due to a down payment of less than 20%—was 25 years. Homes priced at $1 million or more automatically require a 20% down payment and an uninsured mortgage loan.

The federal government states that extending payments over an additional five years will help lower monthly mortgage payments, making housing costs more affordable for young Canadians and incentivizing the construction of much-needed housing supply.
“For every young Canadian who wants to own a home, we want them to qualify for a mortgage and afford their first home. One of the biggest hurdles to homeownership for younger Canadians is qualifying for a mortgage and managing the monthly payments,” said Chrystia Freeland, Deputy Prime Minister and Minister of Finance, in a press release. “That is why, starting August 1, first-time buyers of new builds will be able to reduce their monthly payments with up to 30-year mortgages. This is just one of many new measures our government is implementing to make homeownership a reality for younger Canadians.”

What do I need to qualify for a new build 30-year amortization?
If you’re a first-time buyer shopping for a new construction home and plan to take out a 30-year mortgage, here are some requirements to keep in mind:

• At least one borrower on the application must be a first-time homebuyer, meaning they have never purchased a home before and have not occupied a home as a principal residence that they or their current spouse or common-law partner have owned in the last four years.
• The home being purchased must be newly constructed, meaning it has not been previously occupied for residential purposes.
• Only high-ratio mortgages will be applicable—mortgages where the loan amount exceeds 80% of the home price (i.e., has a down payment of less than 20%).
• All other eligibility criteria for government-guaranteed mortgage insurance will still apply.

Thirty-year amortizations for insured new build mortgages were first announced in the 2024 federal budget, alongside other affordable housing measures.

Source: Royal LePage Team Realty

Don't let a small outdoor space limit your creativity—there are numerous ways to transform even the tiniest area into a charming and functional oasis.

With apartment living becoming increasingly common in urban areas, there's a growing market for practical solutions tailored to small outdoor spaces. This is great news for anyone in search of compact patio furniture, as there are now many options available beyond the traditional bistro set.

We've compiled a list of our five essential considerations to help you turn your compact outdoor space into a comfortable, stylish, and functional retreat without breaking the bank.

1. Comfort

Having a small outdoor space doesn't mean you have to sacrifice comfort. Furnish your condo balcony or similar area with cozy and comfortable pieces.

Ambient lighting can create a welcoming atmosphere. Lanterns and string lights are popular, affordable, and easy to find. If your space allows, consider installing pot lights or pendant lights. Battery-operated or solar-powered lighting can be great alternatives if electrical outlets are unavailable, and LED candles are a safer choice for open-flame lanterns.

2. Privacy

Small outdoor spaces often lack privacy, making relaxation or entertaining awkward. To create a more secluded atmosphere, use privacy screens, room dividers, vertical gardens, or outdoor curtains to shield your space from neighbors.

3. Style

Gone are the days of minimalist balconies with just a bistro set. Today, many patio furniture lines cater specifically to small spaces, making it easy to find pieces that reflect your personal style.

Add color and texture with pillows and throws, and don't neglect the walls—hang artwork, plants, and signs. Lighting not only sets the mood but also serves as decor. Explore different sizes, styles, and colors to suit your space.

Don't overlook the floor; enhance your balcony's style with an outdoor rug, faux wood panels, or painted/stained concrete to match your aesthetic.

4. Durability

While style is important, so is functionality. Choose furniture and decor designed to withstand the elements. Look for items made from aluminum, teak, stainless steel, or weather-resistant wicker. These materials are durable and can handle various climates. High-quality, weather-resistant furniture is a wise investment, especially if you plan to leave it outside year-round.

Consider built-in benches for seating and additional storage for outdoor items and textiles.

5. Budget

When shopping for budget-friendly outdoor furnishings, prioritize durable materials to avoid frequent replacements due to wear and tear.

You can find second-hand furniture and decor on online marketplaces or at thrift stores. Repurpose items you already own and store them indoors during the winter if they can't withstand cold weather.

From cozy furniture to innovative lighting, there are endless possibilities to create a comfortable and functional balcony or patio. Happy decorating!

Soruce: Royal LePage Team Realty

More than half of Canadian mortgages are set to renew before the end of 2026. With the Bank of Canada reducing its key interest rate from 5.0% to 4.75% on June 5th, many homeowners are now contemplating whether to choose a fixed or variable rate upon renewal. Understanding the available options and anticipating changes is crucial to effectively managing today's dynamic mortgage landscape.

Current Situation

During the pandemic real estate boom, variable rates were historically lower, but this trend has reversed recently. Currently, the average five-year variable interest rate offered by mortgage lenders is around 6.7%, while fixed rates are typically at 5.6%. Variable mortgage rates depend on various economic factors, including the key overnight lending rate set by the Bank of Canada. Although the central bank recently cut its key rate for the first time in four years, it could change course if inflation rises in the coming months. Economists expect further cuts by the end of 2024, continuing into 2025 unless economic conditions shift significantly. Despite declining rates, the historically low rates of the past two decades are no longer expected.

Considerations for Variable Rates

For variable-rate mortgages, an increase in the prime rate, influenced by the Bank of Canada's overnight lending rate, leads to higher mortgage payments. However, variable loans with fixed-payment options keep monthly payments unchanged, adjusting the mortgage amortization period instead. This results in a smaller proportion of each payment going towards repaying the principal.

Understanding Your Needs

Choosing between a fixed- and variable-rate mortgage depends largely on the borrower's risk tolerance and personal situation. Variable rates fluctuate, so consider if your lifestyle can accommodate these changes. Even if interest rates begin to fall, numerous economic factors influence their direction throughout your mortgage term. The right mortgage product depends on your short- and medium-term situation. If you're in a period of transition (career change, separation, etc.), a fixed rate might offer more stability.

Strategic Options for Borrowers

• Fixed-Rate Mortgage with a Shorter Term: Amid economic uncertainty, many borrowers are opting for shorter-term fixed-rate mortgages (one, two, or three years). This approach allows borrowers to lock in predictable monthly payments without committing to the same rate long-term.
• Hybrid-Rate Mortgage: This option combines features of both variable and fixed rates — part of the mortgage has a fixed interest rate, and the other has a variable rate. This allows borrowers to benefit from both stability and potential rate decreases.
• Convertible Mortgage: This loan allows borrowers to convert a variable interest rate into a fixed-rate mortgage, or vice versa, before maturity. This flexibility helps adapt mortgage strategies to changing market conditions.

Consult a Professional

Ready to navigate your mortgage renewal with confidence? Contact us today! We can connect you with one of our trusted and experienced mortgage professionals who are ready to help you explore your options and find the best solution tailored to your needs. Whether you're considering a fixed or variable rate, they will provide personalized guidance to ensure you make an informed decision. 

Source: CBD

In May 2024, the Ottawa Real Estate Board (OREB) reported a total of 1,545 homes sold through the MLS® System, marking a 9.2% decrease compared to May 2023. This figure was 3.7% lower than the five-year average and 13.2% below the ten-year average for May. Year-to-date, home sales reached 5,673 units over the first five months of the year, reflecting a 5.2% increase from the same period in 2023.

OREB President Curtis Fillier noted that Ottawa's early spring market remained steady, with an increase in new listings indicating growing seller confidence. However, some sellers may have awaited the Bank of Canada's interest rate announcement before making decisions, as the first interest rate cut in four years occurred. Nevertheless, supply issues and high home prices persist as challenges despite positive economic indicators.

By the Numbers – Prices:

The MLS® Home Price Index (HPI) tracks price trends far more accurately than is possible using average or median price measures.

• The overall MLS® HPI composite benchmark price was $651,300 in May 2024, a marginal gain of 1.2% from May 2023.

  • The benchmark price for single-family homes was $736,000, up 1.1% on a year-over-year basis in May.

  • By comparison, the benchmark price for a townhouse/row unit was $517,500, up 2.1% compared to a year earlier.

  • The benchmark apartment price was $425,000, up 2.0% from year-ago levels.

• The average price of homes sold in May 2024 was $690,683 increasing 0.8% from May 2023. The more comprehensive year-to-date average price was $679,862, increasing by 1.8% from the first five months of 2023.

• The dollar volume of all home sales in May 2024 was $1.06 billion, down 8.5% from the same month in 2023.

OREB cautions that the average sale price can be useful in establishing trends over time but should not be used as an indicator that specific properties have increased or decreased in value. The calculation of the average sale price is based on the total dollar volume of all properties sold. Prices will vary from neighbourhood to neighbourhood.

By the Numbers – Inventory & New Listings

• The number of new listings saw an increase of 26.2% from May 2023. There were 3,034 new residential listings in May 2024. New listings were 23.2% above the five-year average and 10.2% above the 10-year average for the month of May.

• Active residential listings numbered 3,552 units on the market at the end of May 2024, a gain of 59.4% from May 2023. Active listings were 72.2% above the five-year average and 2.9% below the 10-year average for the month of May.

• Months of inventory numbered 2.3 at the end of May 2024, up from 1.3 in May 2023. The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity. 

After maintaining the overnight lending rate at a two-decade high of 5% for 11 months, the Bank of Canada has now reduced its policy rate. In its scheduled June announcement, Canada’s central bank lowered the target for the overnight rate by 25 basis points to 4.75%.

Despite inflation remaining slightly above the BoC’s target of 2%, the overall consumer price index has decreased over the past year, indicating a slowdown in core inflation which is expected to continue.

“Governing Council decided monetary policy no longer needs to be as restrictive and lowered the policy interest rate by 25 basis points to 4.75%,” said Tiff Macklem, Governor of the Bank of Canada, in a statement to reporters following the announcement. “We’ve come a long way in the fight against inflation. And our confidence that inflation will continue to move closer to the 2% target has increased over recent months. The considerable progress we’ve made to restore price stability is welcome news for Canadians.”

Impact on Canada’s Housing Market: With the anticipated interest rate cut now in effect, many rate-sensitive homebuyers are likely to see this as a cue to re-enter the housing market.

A recent Royal LePage survey conducted by Leger found that 51% of Canadians who had postponed their home buying plans in the past two years would return to the market once the Bank of Canada reduced its key lending rate. Specifically, 10% of respondents said a 25-basis-point drop would prompt them to re-enter the market, 18% would wait for a cut of 50 to 100 basis points, and 23% would need to see a cut of more than 100 basis points before resuming their search.

“The long-awaited cut to the overnight lending rate has arrived. The Bank of Canada held its key lending rate at 5% for the past 11 months, and it has been more than four years since the rate was last reduced,” commented Phil Soper, president and CEO of Royal LePage. “Our research shows that half of sidelined homebuyers in Canada plan to resume their home search once the bank rate starts to decline. This will likely spark activity and put upward pressure on home prices in the latter half of the year.”

The Bank of Canada will make its next announcement on Wednesday, July 24th.