Canada’s real estate market finally got some good news—cheaper financing may be coming. The Bank of Canada (BoC) will cut rates three times before the traditionally busy Spring real estate market, according to a report from BMO Capital Markets. The recent labour market erosion has the market fully pricing in the first cut within the next few days. However, the bank notes caveats that sticky inflation and an upcoming CPI report can swing market expectations fast.

Bank of Canada To Cut Rates 3x Before Spring 2026, Market Forecasts First Cut Within Days
Canada’s oldest bank sees rates being slashed fairly aggressively before Spring 2026. BMO’s current forecast is expecting 75 basis points (bps) trimmed by Spring 2026, which works out to three rate cuts. They note the market is currently pricing in the first cut in just a few days, at the BoC’s September 17th meeting.

“We see scope for 75 bps of further easing through the spring of 2026. That would leave rates at the low end of the neutral range and give the economy a little bit of extra support that it seems to need,” writes Robert Kavcic, senior economist at BMO.

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