Bank of Canada Holds Interest Rates at 2.25%: What It Means for Home Buyers & Sellers

The Bank of Canada announced today that it will hold its key interest rate at 2.25%, a decision widely anticipated by economists following a series of cautiously optimistic economic reports. While growth remains modest, experts agree the country is in a stable position—a climate that offers meaningful benefits for both home buyers and sellers.

 Shawn Zigelstein, broker with Royal LePage, framed it clearly: “The economy is not booming, but it’s not in crisis mode.” This middle ground is exactly where many hoped the Bank would land. By choosing to maintain rates rather than adjust them, the Bank is signalling comfort with current economic conditions and setting a predictable foundation for the months ahead.

A Predictable Market Helps Buyers—and Strengthens Seller Confidence

TD Economist Marc Ercolao noted that interest rates have been lowered significantly over the past 18 months, and those reductions are still making their way through the economy:
“These cuts continue to work their way through the economy to support households and businesses, especially during a time of heightened economic volatility.”

With the Bank choosing to hold steady, buyers can move forward without the fear of sudden rate hikes, a major advantage during the home-search and mortgage-planning process. Predictability breeds confidence—something the market hasn’t consistently enjoyed in recent years.

This stability also benefits sellers. When the buying environment feels safe and steady, more buyers come off the sidelines, increasing market activity. As confidence rises, so do showing requests, offers, and overall market momentum. For homeowners considering listing, this type of balanced environment can be an ideal time to make a move.

Looking Ahead

“The Bank of Canada has reinforced that it feels comfortable with the current level of interest rates in the economy,” added Ercolao—an encouraging signal for households making long-term financial plans.

Canadians won’t have to wait long for the next update. The Bank of Canada’s next interest rate decision is scheduled for January 28, 2026. Until then, today’s announcement offers a welcome dose of stability at a time when buyers, sellers, and businesses alike are seeking clarity.

If you're navigating the current market—whether preparing to purchase, sell, or simply want to understand how today’s decision affects your plans—our team is here to help guide you every step of the way.