Bank of Canada Cuts Interest Rate: What It Means for Québec’s Real Estate Market

The Bank of Canada announced a cut to its key interest rate this morning, lowering it from 2.75% to 2.5%. This marks the first decrease since March, and many analysts already expect further reductions by the end of the year. The decision is based on two key observations: inflation appears under control—Canada’s Consumer Price Index rose only 1.9% in August—and the economy is slowing, with GDP contracting and unemployment on the rise.

This rate cut has direct implications for the real estate market, especially in Québec. For buyers, it’s welcome news: lower interest rates generally increase borrowing power and slightly improve affordability. This move could make homeownership more attainable, particularly for first-time buyers who are sensitive to monthly payment changes.

For current homeowners, especially those with variable-rate mortgages or who are due for renewal soon, this shift could mean lower monthly payments. After more than a year of rapid rate hikes that stretched many household budgets, this easing offers some breathing room.

Sellers may also benefit from renewed market momentum. With improved financing conditions, many buyers who had been on the sidelines could re-enter the market this fall. That activity could help stabilize or even boost prices in certain areas—especially suburban markets where supply remains relatively high.

In short, the Bank of Canada’s rate cut marks a turning point for Québec’s real estate landscape. While the impact won’t be immediate or dramatic, it does create a more favorable environment for both buyers and sellers, and may help stimulate residential activity in the coming months.

If you found this article on real estate informative and would like more information, do not hesitate to contact Emmanuel Paquin, your residential and commercial real estate broker. Emmanuel serves the Montreal and Kirkland regions and is affiliated with the company RE/MAX ROYAL (JORDAN) INC.. You can reach him by phone at (514) 757-6268 or visit his website at the following address: https://emmanuelpaquin.com/.

For those specifically targeting the Montreal residential market, Françoise Cardyn is also available to answer your questions. As a residential real estate broker at RE/MAX ROYAL (JORDAN) INC., she can be contacted at (514) 557-4523. For more information or to send an email, visit https://emmanuelpaquin.com/.

With the Emmanuel Paquin Team, you benefit from the expertise of a strong and experienced team in real estate in Montreal. For any questions, contact us at (514) 757-6268 or by email at info@emmanuelpaquin.com.

We hope this article has been helpful to you and we invite you to contact our brokers for any real estate questions or needs in Montreal and Kirkland.