The impact of prime rates on real estate

In this newsletter, you will find the opinions of three of our brokers on the increase in key interest rates and its impact on real estate. Enjoy your reading!

A considerable increase

This week’s shocking news: the Bank of Canada’s key interest rate has risen to 3.25%. Can we already feel the impact of this rate increase in the current real estate market? Three of the brokers on our team share their point of view.

“A certain slowdown is being felt in terms of delays. However, demand remains high. Buyers have a little more time to think about and validate their purchase. A few months ago, everything was done in a hurry. Buyers are still there, but they are taking a little more time. As far as prices are concerned, there are some revisions but nothing alarming for sellers. A well-listed property, at the right price and in good condition can still sell very quickly. The Eastern Townships region remains coveted. The impact of interest rates will probably be felt over the next few months and will have an effect on the buyer’s borrowing capacity. It will be important for sellers to list at the right price.
– Mélissa Côté, real estate broker

“The latest rate hikes have had the effect of calming the overheated real estate market. Everything seems to indicate that there will be other increases in the months to come to balance inflation.
My prediction, as far as we are concerned in our region, is that the real estate market will also tend towards a balance between the buyers’ and sellers’ market. A slight decline in values is also to be expected.”
– Nicolas-Alexandre Morency, real estate broker

“Despite the need for the Bank of Canada to raise interest rates to control inflation, economic growth remains strong. For example, Quebec has a lower unemployment rate than the Canadian average. Therefore, the real estate outlook remains good despite the current context.
– Valery Pigeon, real estate broker

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