The rates have started to fall; Is it enough to bring Buyers back to the market?

Buyers are sitting on the proverbial fence, not quite ready to give up on the dream of owning a home, but also not entirely sure of the market or the economy. Mixed headlines and advice from well- meaning friends and family provide a dichotomy of direction, leading to more uncertainty than clarity.

However, one thing is for sure: if a 'prime' property comes to market in a 'prime' neighbourhood, look out! Buyers are jumping off the fence and coming ready to fight. We have been in a handful of offer nights with intense negotiations and fierce competition this month - walking away with some wins and a handful of losses.

With sales hitting their lowest levels in 27 years, the few select Buyers shopping in this market are all chasing the same properties. This leaves the majority of homes on the market aptly characterized by slow activity, waining showings, and no offers. A slight overpricing or blemish on the home will leave the house overlooked and with no sense of urgency to buy.

The BOC has cut its prime rate for the second consecutive time. In the face of higher unemployment, flat GDP growth and inflation holding below 3%, this allowed Tiff Macklem leeway to reduce the interest rate. The Canadian people have let out a collective breath and maybe a small cheer as some hopes are restored for better times ahead. But did the last quarter basis point change really affect Canadian household pockets? Likely not. Buyers are going to conceivably need several more rate decreases before affording the ability to buy a home in one of the most unfordable markets we have ever seen in Toronto's history.