The housing market in Canada is tilting in favour of buyers as sales soften and new listings rise, according to recent data from the Canadian Real Estate Association (CREA). The national benchmark sale price stayed stable at $718,700 in July, with a slight 0.2% increase month over month but a 4.2% decline year over year.
Despite early optimism after the Bank of Canada’s recent interest rate cuts, the real estate market’s resurgence seems slower than expected. Home sales across Canadian MLS systems edged down by 0.7%, reversing some gains from June.
However, CREA’s senior economist, Shaun Cathcart, remains optimistic, predicting that further rate cuts and pent-up demand will spark a strong resurgence in Canadian housing activity by 2025. While the dip in sales might seem concerning, experts believe it could be just a temporary pause due to factors like high interest rates and affordability challenges.
Phil Soper, CEO of Royal LePage, highlights the crucial role of first-time homebuyers in driving the market. While existing homeowners are returning, first-time buyers—who rely heavily on financing—are still on the sidelines. Soper expects this to shift in the latter half of the year, which could accelerate the entire real estate cycle.
As of the end of July, there were about 183,450 properties listed for sale on Canadian MLS systems, a 22.7% increase from a year earlier, though still below historical averages. Regionally, the market showed mixed results, with declines in areas like Calgary and the Greater Toronto Area (GTA), while other regions such as Edmonton and Hamilton-Burlington saw gains.
In short, while some markets are cooling, others are beginning to see renewed interest from buyers, and the outlook for the housing market remains cautiously optimistic for the coming year.
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