Canada’s 2025 federal budget may not deliver the level of fiscal stimulus many were hoping for—an outcome that could leave the Bank of Canada with little choice but to cut interest rates further, according to some economists. At the end of October, the Bank trimmed its key rate to 2.25%, stating that the current level was “appropriate” to support economic growth while keeping inflation in check.
In its October 29 statement, the Bank acknowledged that Canada’s economy is undergoing a structural shift, largely due to U.S. President Donald Trump’s renewed trade tariffs and the resulting disruptions to trade patterns and supply chains. The Bank noted that this “structural damage” has reduced the economy’s capacity and raised costs—limiting how much monetary policy can do to stimulate demand without reigniting inflation pressures.
Between ongoing trade tensions, slower immigration, and a softening job market, it’s no surprise that homebuyer sentiment remains subdued. These factors likely played into the Bank’s decision to ease rates again last week. Still, the key question remains: Will lower rates be enough to reignite buyer enthusiasm? Interest rates, after all, sit alongside population growth and employment trends as the three most powerful medium-term drivers of Canadian home values.
Guelph recorded 156 sales for the month of October which was about the same as last year. However, the average sale price decreased 5% year over year to $790,684. Sellers received 97.9% of their asking price on average but that is after any price reductions. The average time on market (36 days) increased 21% from October 2024. But keep in mind, many homes were re-listed before selling. The number of listings that were terminated without the property selling was 164. An increase of 192% from a year ago. Going into November, there are 563 active listings which represents 3.6 months worth of inventory. While many potential buyers wait on the sidelines, the 2025 Guelph real estate market is poised to limp over the finish line.
