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Home » Blog » From George’s Desk » Will Latest Rate Decrease Jump-start Market in 2025?

From George’s Desk

Will Latest Rate Decrease Jump-start Market in 2025?

  • By George Mochrie
  • January 2, 2025
Aerial Shot of Downtown Fergus in Winter

Happy New Year everyone!

I’m writing this article assuming you will actually get this magazine in the mail in January. For those of you who were not able to get a copy of the December Booster magazine from one of the pickup locations, feel free to go to my website www.georgemochrie.com to read my December article in my blog section.

The Bank of Canada announced an oversized half point reduction in the bank rate December 11th (down to 3.25%), meaning rates have come down 1.75% since the peak, with additional rate reductions to come. Many economists believe we are headed down to 2.25% by year end.

Lower rates are good for real estate; but keep in mind the reason for lower rates is our economy is slowing down and we will continue to see economic headwinds. Talks about tariffs and increasing unemployment numbers add to uncertainty.

With lower rates, however, affordability is improving, and buyer sentiment is improving as rates are clearly on a downward trajectory and an increasing belief that pricing is at or near bottom in our market. It’s the latter that is important – improved buyer sentiment means buyers will return to the market in greater numbers in 2025.

Having said that, as we closed out 2025, my analysis of the existing homes on the market indicated 70% or more of the listings need price adjustments before they will sell (i.e. the market might be near/at bottom, but many current listing prices are not).

I haven’t said this in awhile – we actually need additional new listings to hit the market (that are priced right) to satisfy demand. Many of the homes on the local market have been listed for extended periods. But buyers are looking for new inventory.

Which means if you are a seller that has been on the market for more than 60 days, NOW is the time to adjust the price to get sold. Otherwise, you will be overlooked as new inventory hits the market – and your listing will become stagnant and you will end up selling for even less than if you bite the bullet now and do a MEANINGFUL price reduction.

It’s time to have a heart to heart with your realtor – and if they aren’t willing to have that difficult conversation and come up with a new selling strategy – well, perhaps it’s also time to change things up realtor wise.

As we head into 2025, despite some economic uncertainty, I’m definitely still more bullish on the local real estate market compared to 2024. I do not see big overall changes in pricing – but higher activity means 2025 will be a better year to sell.

Thinking of selling in 2025? Feel free to reach out anytime for an honest, straightforward discussion on your real estate needs. I can be reached direct at 519-766-3716 or email gmochrie@royallepage.ca

Before I sign off – I would like to thank my team – Reggie Knight and stager Laurie Hazelwood – and of course, my loyal clients. Thanks to you, 2024 was another successful year – and we were fortunate to be in the TOP 2% of all Royal Lepage realtors in Ontario.

Until next month, take care.

George

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