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A significant majority of Canadians do not anticipate improved affordability or increased housing sales as a result of the Bank of Canada’s June rate cut, a new poll by market research firm Abacus Data says.
The survey results showed that 73 per cent of Canadians don’t expect the rate cut to have a significant impact on the affordability of homes and other major purchases. Similarly, 72 per cent of respondents believe the cut will have little effect on the housing market overall.
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“The recent rate cut by the Bank of Canada has left Canadians cautiously skeptical about its impact on housing market affordability and activity,” Abacus Data said in its report.
The survey, conducted from June 6 to 13, polled 1,550 Canadian adults in the wake of the 0.25 per cent interest rate reduction on June 5.
The release follows reports indicating that home sales across the country did not see an uptick after the cut.
Overall, only 35 per cent of Canadians expect the rate cut to influence housing market activity, it said, while 46 per cent foresee no change in housing sales.
The poll said 80 per cent of Canadians do not believe the rate cut will have an impact on affordability, a sentiment particularly strong among older Canadians aged 60 and over.
Meanwhile, 61 per cent expect no changes in the number of homes sold, while 33 per cent are optimistic that the rate cut will trigger more sales.
Only 10 per cent of Canadians plan to expedite their home purchase as a result of the rate cut, while 21 per cent plan to wait for more cuts to occur, it said. About 69 per cent say the rate cut has had no influence on their purchase timeline.
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As for homeowners, 11 per cent are accelerating the sale of their home in response to the rate cut, while 12 per cent plan to defer until further reductions take place. The majority (76 per cent), however, indicate that the rate cut has not affected their decision on when to sell.
The findings underscore a cautious consumer outlook regarding the influence of rate cuts on buying and selling decisions, the report said.
“When Canadians look at the recent rate cut by the Bank of Canada, many are playing it safe,” it said. “They’re not convinced it’ll make buying a home cheaper or shake things up much in the housing market.”
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The survey has a margin of error of +/- 2.53 per cent, 19 times out of 20.
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