The swift increase in Bank of Canada interest rates over the past two years has led to millions of potential homebuyers delaying their plans.

According to a recent survey by Royal LePage, 56% of Canadian adults have postponed their property search due to higher interest rates.

Among those who delayed, 51% are willing to re-enter the market if interest rates decrease. However, their conditions vary:

• 10% would return with a 25 basis point cut.
• 18% are waiting for a cut between 50 and 100 basis points.
• 23% need to see a reduction of over 100 basis points before considering re-entry.

However, 20% of sidelined buyers have abandoned their plans to purchase a home altogether.

The timing of interest rate decreases remains uncertain. While the Bank of Canada announces its rate decision next Wednesday, economists predict the first cut may not occur until June.

Economic indicators have been mixed, with recent data showing fluctuations in inflation rates.

Policymakers are cautious about rate cuts due to the resilience of the housing market. Despite declining house prices in January, the sales-to-new listings ratio suggests a potential rebound in prices.

Market uncertainty persists regarding the timing of rate cuts, with forecasts extending beyond June.

Homeowners face challenges amid rate hikes, with nearly 80% expected to see significantly higher mortgage payments by year-end.

A survey by Ratehub.ca reveals that 70% of homeowners find it harder to pay mortgages since March 2022. Concerns about making payments upon mortgage renewal are prevalent among respondents.

Strategies to cope with higher payments include budget tightening, refinancing, and downsizing.

Despite expectations of lower variable rates, fixed-rate mortgages remain popular among borrowers due to the desire for stability.

Housing affordability in Canada continues to decline, nearing levels not seen since the 1980s, particularly impacting renters.

Renters face challenges despite expected rate cuts, with a record low national vacancy rate.

Supply constraints persist as building permits decline in several Canadian cities at the end of 2023.