Here’s how would-be homebuyers are responding to the Bank of Canada rate cut

By Craig Lord , Global News
The first interest rate cut from the Bank of Canada in more than four years will not be enough to help most prospective homebuyers feeling sidelined by high borrowing costs, new polling suggests.
The Ipsos poll conducted exclusively for Global News after the Bank of Canada’s 25-basis-point rate cut on June 5 shows pessimism about housing affordability persists.
“What Canadians are saying to us here is, 25 basis points is just a drop in the ocean,” says Sean Simpson, senior vice-president at Ipsos Global Affairs. The central bank’s policy rate is a key input into housing costs, affecting both the size of mortgage Canadians can qualify for and the amount they pay on a monthly basis.
Just over six in 10 respondents (63 per cent) to the polls said they’ll remain on the sidelines of the housing market due to high interest rates. More than 1,000 Canadians aged 18 and older were interviewed online between June 7-10.
Among those who don’t own a home, some six per cent said interest rates would have to drop by less than one percentage point for them to consider buying a property. One in four said they’d need to see cuts of between one and 3.99 percentage points to get into the market, while 10 per cent said they needed steeper drops to make home ownership a possibility.
Simpson tells Global News the quarter-percentage point drop might be a “good start,” but Canadians are feeling like there’s a long way to go before housing affordability improves for most. “The reaction from Canadians is, ‘Nice try. Keep going, Bank of Canada,’” he says. Some 45 per cent of respondents maintain that they won’t be able to afford a home no matter how much interest rates drop.
Most Canadians (78 per cent) indicated that owning a home in Canada is now only for the rich, a slight decrease from the 80 per cent who said as much in similar polling from April.
Six in 10 respondents (62 per cent) said they’d given up on ever owning a home — that, too, is down from 72 per cent in April…
Source: globalnews.ca/