Canadian real estate: Signs of recovery come with rising listings and cautious optimism

There’s an interesting pattern emerging in Canadian real estate: ever since the Bank of Canada’s first rate cut, home sales have increased as buyers get improved affordability, though still well below the long-term average.

Price recovery is still yet to be found, and sales volume trended up again 1.3 per cent month-over-month in August, reaching its highest level since January 2020.

At the same time, new listing activity continues to accumulate with new listings climbing for the fourth straight month. Will this trend continue? The market will head into buyer’s market territory, where supply is outgrowing demand.

With that in mind, there are expectations that future rate cuts into 2025 well lead to cautious optimism among potential buyers and investors.

Newly listed properties in Edmonton and Calgary offset GTA decline 

Despite the uptick in sales, the market remains mostly stuck in a holding pattern as many buyers are waiting for improved affordability before making purchases.

The number of newly listed properties increased by 1.1 per cent month-over-month in August, with approximately 177,450 properties available for sale — up 18.8 per cent from the previous year, but still below historical averages.

But for the second month in a row, there was a boost in new supply in Calgary, with Edmonton also witnessing an uptick of listings. The rise of newly listed properties in Edmonton and Calgary offsets a decline in the GTA. 

Consistent, stable increase in sales-to-new-listings

The national sales-to-new listing ratio rose slightly to 53 per cent, matching our record in April. We’re a long way from returning to what was our highest average of sales-to-new listings which we achieved in December 2023: 81 per cent.

We have been relatively and consistently stable ever since our increase from January’s 46 per cent to February’s 52 per cent. So, it may be some news that we’ve matched our April 2024 average. 

Prices

After Canada experienced a record high price in 2022, the market recoiled down about as quickly as it jumped up. Since the bottom of the recoil, we’ve seen very little upward or downward momentum in price. 

Significant fluctuation in GTA condominiums

Toronto area condominium apartments are having a significant fluctuation, with a recoil off of an all-time high price and a few bounces since the blow-off top. 

Source: x.com/Tablesalt13/

It’s clear that the outlook doesn’t look good for 2025, as it seems it will touch the 350 margin — the record low from around 450 in January 2022.