Bank of Canada Holds Interest Rate at 2.75%
What It Means for Ottawa’s Real Estate Market
On June 4, 2025, the Bank of Canada announced it would maintain its key interest rate at 2.75% for the second consecutive time. This decision comes amidst ongoing economic uncertainties, including escalating U.S. tariffs and fluctuating inflation rates.
Why Did the Bank of Canada Hold the Rate?
The central bank’s decision to hold the interest rate steady is influenced by several factors:
- Trade Tensions: The U.S. has doubled tariffs on Canadian steel and aluminum, introducing significant uncertainty into Canada’s economic outlook.
- Inflation Concerns: While overall inflation has slowed to 1.7% in April, core inflation—which excludes volatile items like food and energy—has risen above the Bank’s target range of 1% to 3%, partly due to higher goods prices linked to trade disruptions.
- Economic Performance: The Canadian economy grew by 2.2% in the first quarter, mainly due to increased exports ahead of new U.S. tariffs. However, domestic consumption has been weak, and unemployment has risen to 6.9%, the highest since November.
Given these mixed signals, the Bank is adopting a cautious approach, choosing to monitor the situation further before making additional changes to the interest rate.
What Does This Mean for Ottawa's Real Estate Market?
For Ottawa’s real estate market, the steady interest rate provides a period of stability:
- Mortgage Rates: With the Bank’s rate unchanged, mortgage rates are likely to remain stable in the short term, making it an opportune time for potential buyers to enter the market.
- Buyer Confidence: Stable rates can boost buyer confidence, potentially increasing demand for homes in the Ottawa area.
Investment Opportunities: For investors, the steady rate environment may present opportunities to invest in properties before any future rate changes.
What Should Ottawa Home Buyers Know?
Thinking about buying a home in Ottawa? Now might be the right time to make your move.
- Mortgage Rates Are Holding Steady
With the Bank of Canada keeping rates unchanged, buyers still have access to relatively affordable borrowing options. If you’ve been waiting for the right moment, this could be it—lock in your rate before any future changes. - Be Ready for Competition
Ottawa’s real estate market continues to see steady demand. Good homes—especially in popular neighborhoods—can move quickly. Get your mortgage pre-approval ready and have a clear idea of your budget so you can act fast when the right home hits the market. - Work With a Local Expert
Navigating the Ottawa market is easier with an experienced real estate professional by your side. A knowledgeable agent will help you understand neighborhood trends, negotiate with confidence, and avoid costly mistakes.
What Should Ottawa Home Sellers Know?
If you’re thinking of selling your home in Ottawa, the current market conditions are working in your favor.
- More Buyers Are Stepping In
Stable interest rates often bring more buyers into the market. That means more eyes on your listing and a better chance of selling faster—especially if your home is priced and presented right. - Price Strategically for Today’s Market
Even in a strong market, accurate pricing is key. A well-priced home attracts serious buyers and avoids sitting on the market too long. Your real estate agent can help set the right asking price based on current Ottawa-area trends. - First Impressions Still Matter
Before listing, consider small upgrades like fresh paint, landscaping touch-ups, or professional staging. These simple improvements can boost your home’s appeal and lead to stronger offers.
What's Next? Will Rates Go Up or Down?
The Bank of Canada has indicated that future rate cuts are possible if the economy shows signs of weakening and inflation remains under control. However, ongoing trade tensions and rising core inflation suggest that the Bank will proceed cautiously. The next interest rate announcement is scheduled for July 30, 2025.
Ready to Make a Move? Let PREMIER Real Estate Guide You
Whether you’re buying your first home, upgrading, downsizing, or selling an investment property, our experienced team at PREMIER Real Estate is here to help you every step of the way. We understand the Ottawa real estate market inside and out—and we know how interest rate decisions like this one can shape your next big decision.
Looking to buy? We’ll help you find the right property, negotiate with confidence, and connect you with trusted mortgage professionals.
Selling a home? We’ll provide the marketing, pricing strategy, and local expertise you need to get the best results.
Contact us today to schedule your free consultation and let’s talk about your next move in Ottawa’s ever-evolving real estate market.
Stay Updated on Real Estate Trends
For more information and personalized guidance on navigating today’s housing market, contact PREMIER Real Estate today!
