Many people were cheering the Bank of Canada's decision to decrease its policy interest rate for the second consecutive time on Wednesday, but none more so than those working in the real estate industry.
The 25 basis points reduction brings the overnight rate to 4.5 per cent, returning to levels not seen since June 2023.
Last month’s cut from 5 per cent to 4.75 per cent was the first in more than four years, and the Bank of Canada also signalled more cuts are coming if inflation continues to ease.
It comes at a time where home sales in Windsor-Essex have dropped for a fourth straight month, but those in the real estate industry said they believed we were feeling a shift before Wednesday's news.
The latest report for June showed sales down 17.39% across the region, with the average price down by 1.74% compared to the same time last year.
Prices are hovering in the $570,000, and have been sitting around there for the last four or five months.
Maggie Chen, President of the Windsor-Essex County Association of Realtors, says the reaction to the cut was excitement and happiness as this is a good signal for movement on the market.
"Great news for our industry, I think for both buyers and sellers. For buyers they see the hope to be able to afford a home, and then for the sellers we think that the market should be recovering maybe slightly but it will definitely be better than before," she said.
Chen says they are a lot of sideline buyers who were waiting to see what was going to happen with interest rates before making a move, and now the Bank of Canada has set the tone for rate cutting.
"I anticipate more movement, more sales, not necessarily or probably not yet see the pricing increase or jump quickly. I do not expect that, but definitely I expect a more active market."
She says generally speaking, interest rates are always the center of conversations with prospective buyers so this is a good sign for the market.
"It will get loosened up, buyers will be more relaxed and the sellers will be waiting to probably talk to the buyers as well. So we're going to have more sales generated in the market," Chen said.
Chen believes that an environment with lower interest rates, and the Bank of Canada signalling more cuts could be coming if the economic indicators are right, is a great place to be.