Interest rate drop could make it easier for first-time homebuyers

Townhomes for sale on Walker Road in Windsor, seen on July 25, 2024. (Gary Archibald/CTV News Windsor)

With the drop in interest rates on Wednesday to 4.5 per cent, local realtors say it could be advantageous for the overall market, especially for first-time homebuyers.

The cut of 25 basis points is the second time this year the bank of Canada made that reduction, and that spells good news for potential buyers for the remainder of the calendar year.

For Windsorites, the average single detached home price is now $550 thousand, much less than a peak of over $700 thousand a year and a half ago.

Now, there's more overall affordability in terms of purchase price and mortgage payments.

Frank Binder of Royal Le Page, Binder Real Estate is hopeful this development will be a winning formula for buyers and sellers.

"That's a good sign for us,” said Binder. “That's actually good for us to see the median point at that level. That means we can have more certainty again about, or more consideration with regard to being [that] I'm not overpaying in the market that we're in. And, that's a good thing."

Economic forecasters are hopeful that the robust Canadian economy and slowing inflation will also make home buying marginally more affordable across the country over the next six to 12 months.