Why Waiting for Lower Interest Rates Could Cost You More

MORTGAGES & FINANCING

Strategic guidance on mortgages, refinancing, and home equity.
 

If you're thinking about buying a home in Durham Region, you may be asking yourself a very reasonable question:

Should I buy now, or wait for interest rates to come down?

At first glance, waiting seems to make sense. A lower mortgage rate could mean a lower monthly payment and potentially allow you to qualify for a larger mortgage.

But there is another side to the equation that buyers sometimes overlook.

If lower rates bring more buyers back into the market, you could save on your mortgage rate but end up paying more for the home itself.

That's why the decision to buy shouldn't be based on interest rates alone.

Where Interest Rates Stand Right Now

At its July 15, 2026 announcement, the Bank of Canada maintained its policy interest rate at 2.25%. The rate has now remained at that level since October 2025.

The Bank said Canada's economy is showing signs of improvement, while inflation is expected to gradually ease. However, it also emphasized that considerable uncertainty remains, including risks related to energy prices, the conflict in the Middle East and U.S. trade policy.

In other words, nobody can say with certainty where rates go from here.

The Bank of Canada's next scheduled interest-rate announcement is September 2, 2026.

And that's an important point for buyers.

Trying to perfectly time an interest-rate change can be just as difficult as trying to perfectly time the real estate market.

The Part Buyers Sometimes Forget: Everyone Else Is Waiting Too

You're probably not the only buyer hoping mortgage rates will fall.

There are potential buyers throughout Durham Region and the GTA who have delayed purchasing because of mortgage costs, economic uncertainty or simply because they're waiting to see what happens next.

If borrowing conditions become more attractive, some of those buyers may decide it's finally time to start looking again.

We're already seeing signs of activity improving nationally. CREA reported that Canadian home sales increased in April, May and again in June, leaving national sales activity approximately 7% higher in June than it had been in March. CREA also said it expects the second half of 2026 to be more active than the first.

That doesn't mean prices are about to suddenly take off. It does mean buyers should consider what could happen if demand strengthens.

Lower Rates Don't Necessarily Mean a Cheaper Home

Here's the trade-off.

Suppose you're waiting because you want a lower mortgage rate.

If rates decline, your financing costs may improve.

But if the lower rate encourages significantly more buyers to enter the market, desirable homes may attract more attention. Buyers could have fewer opportunities to negotiate, properties could sell faster, and prices in some neighbourhoods or property categories could strengthen.

You could therefore get the lower mortgage rate you were waiting for while losing some of the negotiating power you have today.

The best mortgage rate and the best buying opportunity don't always arrive at the same time.

A Lower Purchase Price Can Have Long-Term Value

Mortgage rates change.

The price you pay for your home doesn't.

Depending on your mortgage, you may have opportunities to renew or refinance at different rates in the future. But once you've paid a higher purchase price for a property, that becomes part of your cost of ownership.

That's why I encourage buyers to look beyond the initial mortgage rate.

Consider the entire transaction:

• What price can you negotiate?
• How much competition are you facing?
• How many suitable homes are available?
• Can you include appropriate conditions in your offer?
• How long do you expect to own the property?
• Can you comfortably afford the payments at today's available mortgage rate?

Sometimes buying in a quieter market at a better price can make more financial sense than waiting for a lower rate and competing against more buyers.

More Inventory Can Mean More Choice

Another factor worth considering is selection.

When the market is slower, buyers may have more time to compare homes and carefully consider their options.

That can be particularly valuable if you're looking for something specific, such as a detached home, a certain school area, a legal basement apartment, a larger lot, a particular neighbourhood or a home within a strict budget.

Instead of feeling pressured to make a quick decision, you may have an opportunity to negotiate price, closing date, conditions or other terms.

That negotiating position can have real value.

What If Rates Do Fall After You Buy?

This is one of the most common concerns I hear from buyers.

Nobody wants to buy today and then discover that mortgage rates dropped shortly afterward.

But remember that your first mortgage rate doesn't necessarily remain your mortgage rate forever.

Depending on the mortgage product you choose, your term, lender and future circumstances, you may eventually have an opportunity to renew or refinance at a different rate.

This is one reason I recommend speaking with a qualified mortgage professional before deciding to wait.

Ask them to show you the numbers rather than simply guessing what a future rate reduction might save you.

How much would your payment actually change if mortgage rates dropped by 0.25%, 0.50% or even 1%?

Then compare those potential savings with what could happen if the price of the type of home you're considering increased during the same period.

You may be surprised by the answer.

Waiting Can Make Sense Too

I don't believe everyone should rush out and buy a home simply because rates might change.

There are very good reasons to wait.

If your employment is uncertain, your down payment isn't ready, you're carrying too much debt, you don't expect to remain in the home very long, or today's mortgage payments would stretch your budget too far, waiting may be the responsible choice.

Buying a home should fit your situation, not someone else's prediction about interest rates.

The important thing is to make sure you're waiting for the right reason.

Waiting because you're not financially ready is very different from waiting because you're trying to predict exactly when mortgage rates will reach their lowest point.

Something to Consider

The question isn't simply:

"Will interest rates come down?"

A better question may be:

"If rates come down, what else could change?"

Could more buyers enter the market?

Could competition increase?

Could sellers become less willing to negotiate?

Could the home that costs $750,000 today cost more by the time the rate you're waiting for finally arrives?

Nobody knows for certain.

That's precisely why basing such a major decision on one variable can be risky.

From My Experience

I've been helping people buy and sell homes in Durham Region and the GTA since 1989, and one thing I've learned is that there is rarely a moment when every market condition lines up perfectly.

When prices are attractive, interest rates may be higher.

When rates are attractive, competition may be stronger.

When the economy feels completely comfortable, many other buyers may feel comfortable too.

Rather than trying to find the "perfect" market, I believe the better approach is to determine whether the current market provides an opportunity that makes sense for you.

If the right home is available, the numbers work comfortably and you can negotiate favourable terms, buying before everyone else decides it's time to buy may be worth considering.

Thinking About Buying in Durham Region?

Before deciding whether to buy now or wait for lower rates, let's look at the actual numbers.

I can help you understand what homes in your price range are currently selling for in Ajax, Pickering, Whitby, Oshawa, Clarington, Uxbridge and across Durham Region, how much negotiating room buyers may have, and what I'm seeing in the market right now.

If you haven't already spoken with a mortgage professional, I can also recommend or refer you to a trusted mortgage specialist who can help you understand your financing options and what different interest-rate scenarios could mean for your monthly payments and purchasing power.

Then you can compare today's buying opportunity with the potential benefits and risks of waiting.

The goal isn't to predict the market perfectly.

It's to make a well-informed decision that's right for you.

My VIP Buyer Cash Savings Guarantee*

Finding the right home is only part of the equation. Getting the right price matters too.

Through my VIP Buyer Cash Savings Guarantee, if I don't save you at least $10,000 off the asking price of the home you purchase, I'll pay you $1,000 on closing.*

It's another way I help my buyer clients focus not just on finding the right home, but on getting the best possible value when they buy.

WANT TO KNOW WHAT YOU CAN BUY RIGHT NOW?

Or call me directly at 905-683-7800 to discuss your plans. There's no pressure or obligation. We can simply talk about what you're looking for, what you're comfortable spending, and whether buying now or waiting makes more sense for your situation.

 

Thanks For Reading Today’s BLOG!

Brian Kondo
Sales Representative / Team Leader
The Brian Kondo Real Estate Team
Re/Max Hallmark First Group Realty Ltd.
905-683-7800 office
905-426-7484 direct
brian@briankondo.com
www.BrianKondo.com
www.BrianKondoTeam.com


If you or anyone you know is considering making a move in the next little while, give me a call or pass on my number ... 905-683-7800 (Office) or 905-426-7484 (Direct).

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