Lower interest rates create a competitive landscape for brokers and sellers
Mortgage brokers are preparing for a surge in competition as homebuyers return to the housing market, driven by lower interest rates and shifting market dynamics.
Home sales in October reached their highest level in more than two years, climbing 7.7% from the previous month, according to the latest data from the Canadian Real Estate Association (CREA). Meanwhile, the benchmark home price edged down 0.1% to $716,800, offering a brief window of opportunity for buyers.
The Bank of Canada’s recent rate cuts appear to have rejuvenated buyer interest after months of hesitation. Mortgage brokers report a notable increase in pre-approvals, signalling that many prospective buyers are no longer waiting for further rate reductions.
“We’ve seen a notable surge in sales alongside a decline in new listings,” Leah Zlatkin, a licensed mortgage broker and LowestRates.ca expert, said in an interview with BNNBloomberg.ca. “This, combined with new mortgage rules coming into effect on December 15 and the Bank of Canada’s anticipated rate cuts next month, will further heat up competition.”
Zlatkin noted a significant increase in mortgage pre-approvals as many buyers are watching the market closely for the right moment to act.
“Homebuyers who were sitting on the sidelines are now actively engaging, weighing their options, and asking critical questions about whether fixed or variable rates best suit their needs in this evolving environment,” she said. “For those considering a home purchase, the window of opportunity is closing. Now is the ideal time to act before the market tilts decisively in favour of sellers.”
Victor Tran, a mortgage and real estate expert at RATESDOTCA, said that the housing market’s renewed activity is positive for both buyers and sellers.
“If the Bank of Canada makes another jumbo rate cut in December, we could see a turning point in buyer psychology that could drive a busy winter season,” Tran told Bloomberg, adding that this influx of buyers could quickly heat up the market and push home prices higher.
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“They have pre-approvals and are looking for the right moment and the right property to purchase,” he said. “Once the tide turns and buyers enter the market en masse, we will likely see the market heat up quickly, and a corresponding rise in home prices.”
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