As someone who’s worked with clients through every market shift since 2010, I’ve seen firsthand how lower interest rates can quickly drive up housing demand in Canada. According to central bank research, resales start climbing almost immediately after rate cuts, with the full effects showing up 18 to 24 months later. Meanwhile, it typically takes about two years before we see a meaningful uptick in new housing starts—especially with the added planning and permitting needed for larger projects. While strong job markets and easier lending conditions encourage buyers to act faster, builders respond more slowly as improved prices and financing gradually make projects more viable. Ultimately, these findings highlight something I discuss often with clients: although rate cuts can eventually help add supply, they aren’t a quick fix for affordability. The supply always lags behind demand, which means relying solely on lower borrowing costs won’t solve the underlying pressures on housing. Understanding this cycle is essential when choosing the right mortgage strategy for your needs.
Leave a Reply