The September Rate Cut Bombshell, And What It Means for You

Fall is off to a strong start, and today’s rate cut might just push things into overdrive.

According to the Canadian Real Estate Association, August marked the best month for sales since 2021, with a 12.5% gain since March. Buyer interest is growing, listings are picking up, and benchmark prices are stabilizing.

Now, add in a welcome prime rate cut from the Bank of Canada, down to 4.7%, and we may see even more movement heading into the fall market.

Why the Rate Cut Happened

Several factors contributed to today’s decision:

• GDP fell in Q2, as trade uncertainty and tariffs weighed on exports.
• Employment slowed, especially in trade-exposed sectors.
• Core inflation indicators are losing steam, with short-term averages pointing closer to 2.5%.

While year-over-year inflation measures remain sticky near 3%, the trend is softening, giving the Bank room to cut without derailing its inflation mandate.

What It Means for You

This is a pivotal moment for borrowers.

If you have an adjustable-rate mortgage, variable-rate mortgage,  a HELOC, or are looking to renew or refinance, this rate cut may create tangible monthly savings or a chance to optimize your long-term strategy. For every $100,000 borrowed, the average monthly payment reduction could be around $14.

But more than that, it signals a shift in tone. The Bank is open to easing, and buyers who’ve been sitting on the sidelines may soon re-enter the market.

Planning Ahead

Of course, this doesn’t mean every rate decision moving forward is a guaranteed cut. The Bank made it clear: they’ll continue to monitor the impact of global trade disruptions, labour market weakness, and inflation trends before committing to further moves.

Still, for many Canadians, this may be the nudge needed to revisit their financial goals.