Rate Hike Speculation Sends Shivers Through Canadian Housing Market

Speculation about potential rate hikes by the Bank of Canada (BoC) is sending shockwaves through the Canadian housing market, which has already been reeling from the impact of the US-Iran war and the tariff war launched last year.

Economists such as TD's Andrew Hencic and BMO's Doug Porter believe that while a rate hike in September is unlikely, there is a growing possibility that rates will increase in 2027. If this happens, it would be bad news for mortgage market watchers who had hoped for rate cuts.

According to Joel Fox, chief operating officer and co-founder of Toronto-based real estate technology firm Ownright, rate increases by the central bank would weigh down the national market even further. 'If interest rates are adjusted upwards, we just have additional forces impacting the market,' he said.