VANCOUVER (October 23, 2024) – The Canadian Mortgage Brokers Association – British Columbia (CMBA-BC) welcomes today’s announcement by the Governor of the Bank of Canada Tiff Macklem that the Bank of Canada will substantially cut its key overnight rate by 50 basis points from 4.25 per cent to 3.75 per cent. This decision follows rate cuts in June, July and September of 25 basis points each. The central bank is also signalling that further rate reductions may be on the horizon as we approach 2025.
CMBA-BC is strongly encouraged by today’s decision, viewing it as a positive step towards alleviating financial pressure on mortgage holders, borrowers, and first-time homebuyers across British Columbia. While immediate changes to fixed mortgage rates may not occur, variable rate mortgages and Home Equity Lines of Credit will benefit from the decreased prime lending rate. Additionally, homeowners nearing mortgage renewal can expect significant relief.
“Today’s decision is a crucial lifeline for mortgage holders and prospective buyers in our province,” said Rebecca Casey, President of CMBA-BC. “We are pleased to see this accelerated interest rate cut and believe it will provide much-needed financial relief, particularly for first-time homebuyers who are struggling to enter the market.”
CMBA-BC has strongly advocated for policies that support mortgage holders and homebuyers, emphasizing the importance of reducing interest rates in the current economic climate. Ongoing cuts can significantly help residents facing the challenges of inflation and rising living costs.
Recent economic indicators show many positive trends, including inflation in decline. Statistics Canada reported a stark decline in the Consumer Price Index (CPI) to 1.6 per cent in September, down from 3.8 per cent just a year prior. GDP growth on the other hand has remained steadier, at 0.9 per cent in Q2, up from 0.6 per cent in Q1 of this year.
Despite these improvements, the housing market remains under strain and is top of mind for British Columbians. An October 11 poll conducted by Ipsos indicated that housing affordability and availability was among the top three issues in the BC provincial election, with 31 per cent of voters indicating it was their number one concern.
“To create a more supportive environment for those managing higher payments and to improve the overall mortgage landscape in B.C., ongoing economic relief is essential,” added Casey. “This latest and significant rate cut is a step in the right direction towards enhancing the housing market and providing greater stability for consumers.”
CMBA-BC is committed to advocating for homebuyers and mortgage holders while promoting a stable and thriving housing market in British Columbia.
Published by CMBA – Canadian Mortgage Brokers Association British Columbia