Canadian Real Estate Association Lowers Sales Forecasts For 2019… Again

The Canadian real estate industry expects sales to slow further than previously thought. Canadian Real Estate Association (CREA) economists have revised their annual forecasts. The good news is the summer was better than expected, leading to an improved outlook for 2018. The bad news is the ambitious 2019 forecast is looking less ambitious. CREA now expects that 2019 will look very similar to this year.

Forecasting Is Hard

Forecasting is a tricky task, and revisions are fairly normal for most organizations. Since a forecast is based on everything you know at the time, a forecast is subject to change as new details emerge. A year end forecast with three-quarters of the year in the bag is a little easier, since you’ll adjust your targets. That said, we did say the forecast in 2017 didn’t make much sense, since it ignored changes to credit capacity. Point is, don’t rag too hard on the fact that they were revised, it’s actually pretty normal.

Canadian Real Estate Sales Forecasted To Drop 9% In 2018

Canadian real estate sales will drop in 2018, and expectations for 2019 have cooled. CREA is forecasting 462,900 sales across Canada by year end, down 9.8% from last year. In 2019 they expect sales to rise to 472,700, up 2.1% from the 2018 forecasted number. Both numbers are down significantly from last year, and well below the 10 year average for sales.

Canadian Real Estate Sales Forecast

The Canadian Real Estate Association sales forecast for 2018, and 2019 – including revisions.

Source: CREA, Better Dwelling.

Ontario Real Estate Sales Forecasted To Fall Over 11% In 2018

Ontario real estate sales are expected to fall this year, but pick up slightly in 2019. CREA is forecasting 193,300 sales in 2018, a decline of 11.8% compared to last year. In 2019 that number is expected to rise to 203,600, up 5.3% from their 2018 forecast. The 2018 revision includes an upward revision, but the 2019 expectations are now lower. Both years are lower than 2017.

Canadian Real Estate Sales Forecast

The Canadian Real Estate Association September sales forecast for 2018, and 2019.

Source: CREA, Better Dwelling.

British Columbia Real Estate Sales Forecasted To Fall Over 22%

British Columbia real estate sales are expected to see the largest decline. CREA is forecasting 80,700 sales in 2018, down 22.2% from last year. In 2019, that number is expected to drop to 80,400, down another 0.2% from the 2018 forecast. Both represent dramatic downward revisions from the previous forecasts.

Quebec Real Estate Sales Forecasted To Rise Over 2%

Quebec real estate sales are one of the few markets expected to grow over the next few years. CREA is forecasting 85,600 sales in 2018, up 3.7% from last year. In 2019, they’re forecasting 85,750 sales, up another 0.2% on top of the 2018 forecast. Quebec, unlike Ontario or BC, did not see a surge and peak in 2016. The growth appears to be more organic, with much smaller price gains.

Cheap credit and a dash of FOMO led Canadian real estate sales to record highs in 2016. Since both of those are on their way out, it shouldn’t surprise the industry that sales are dropping off. CREA is finally adjusting their outlook to accommodate that.

Except, there is a minor issue with their 2019 forecast. This year the economy is booming, and sales have tapered down due to prices running a little hot. In 2019 an increasing number of economists are starting to forecast a recession. In which case, how are expectations higher when the economy is expected to perform worse?

Like this post? Like us on Facebook for the next one in your feed.



We encourage you to have a civil discussion. Note that reads "civil," which means don't act like jerks to each other. Still unclear? No name-calling, racism, or hate speech. Seriously, you're adults – act like it.

Any comments that violates these simple rules, will be removed promptly – along with your full comment history. Oh yeah, you'll also lose further commenting privileges. So if your comments disappear, it's not because the illuminati is screening you because they hate the truth, it's because you violated our simple rules.

  • David 4 years ago

    Where are all of the people piling in about how Better Dwelling being wrong about sales falling, when the industry starts to say it as well?

    • Quon L 4 years ago

      They only have time to s**t talk when they have a break from between jobs. Dontcha know, every that owns a house is rich in Canada, even those that work at Starbucks. Us stock market clowns don’t know how to make money like the 60% of homeowners in the country. Not a bubble. 🤪

    • SCE 4 years ago

      Meh. I only go by cold hard facts. These forecasts don’t mean much. People have been forecasting some massive correction for years. So as I said before, continuing hiding behind your forecasts/predictions/wishful thinking.

  • Mica 4 years ago

    2019 is when everyone is expecting to sell (waiting it out). The question is going to be who wants a deal more, the buyers or sellers? I’m guessing it’s the latter, since the former mostly need to make a big stretch to buy anyway.

    • Bluetheimpala 4 years ago

      Will there be an economic event in the next 6-12 months which may force many to conserve the massive amount of equity they have built up over the last 40 years? In the face of YoY declines, would conserving the equity mean selling or holding? Are there many boomers sitting on fully funded retirements or are there deficiencies? What would a HELOC or reverse mortgage lender do if they felt the asset backing their loan was at severe risk? Canada is a country of paper millionaires with some stats suggesting 1 in 5 are in this class. Home rich boomers praying they can wait it out and sell at 2017 levels will face a dilemma over the short term. This is not what I am hoping for, this is a potential scenario we should think about and analyze. Watch the paper men and women flee once the match is lit; they are the most fragile and know they cannot be burned. Tick Tock. BD4L.

  • Ian 4 years ago

    There forecast makes no sense. They lost 30,000 sales in Ontario, but they think the total loss across Canada is going to be just 40,000? Are they unaware that Vancouver is at 17 year lows for sales? Other provinces can’t make that up.

    • Bluetheimpala 4 years ago

      Hmmm…you mean they are setting themselves up for a downgrade? One that will catch them off guard and couldn’t be predicted? Pure number jockeys, wait for a major down The RE landscape is changing and I honestly believe there will be legislation put in place, probably 2020, that will gut these industry bodies and essentially make them a non-issue with training being run via the government to generate income but also regulate an industry that shouldn’t be games like a crooked casino. They did it to themselves with greed and petulance. Tick tock. BD4L.

  • 0oo0 4 years ago

    Pro observation here. Anyone notice that the original 2018 forecast is above the new 2019 forecast? 2019 will probably get chopped down as rates rise and the year progresses.

  • someguy 4 years ago

    Anyone not taking the under on the 2019 forecast is a dolt.

  • SUMSKILLZ 4 years ago

    Anecdotally speaking, walking the dog on weekends, I see lots of “open houses” with little to no traffic. I’m talking about mid range prices ($750K – $950K) in the farther suburbs of Toronto. Starter homes with land (aka builder basic row houses), priced reasonably, on the other hand seem to either sell lickety-split or have line ups at their open houses.

    That’s why I hate aggregate figures for sales. They can easily hide things that can be of interest.

  • Asterix1 4 years ago

    Who ever trusts the opinions and forecasts of: CREA, TREB, Realtors, banking analysts and developers deserve to be taken for the biggest ride of their life!

    Ross Kay, the best…

    Question: “CREA says that sales have gone up. Are those numbers correct?”

    Ross Kay: “No, they are not correct, they are an outright manipulation of the stats, to create a message designed to benefit the pocketbooks of the realtors across Canada”

  • Joe 4 years ago

    In general lower sales means a drop in prices will follow. But in RE, prices are sticky and will take quite a lot to move prices down especially for houses in good locations where the neighborhood has a lot to offer. Owners with one property will choose to hold out and not sell lower than their neighbors whereas speculators (more rampant in the 905 region) tend to cut losses when they experience negative/slow returns.

    For detached houses/SFH, I feel that many owners in Toronto (416 region) are living in their property and can comfortably weather paper loss/slow gains since it’s their home and they need a place to live anyway. (can’t say the same for condos). With this reason, Toronto SFH prices will hold up well even in a RE downturn. The rising interest rates will have an impact on homeowners who are ultra leverage but the conditions for a housing crash in Toronto would require a huge economic downturn with significant job losses/etc.

    For the 905 region, sales and prices are more volatile as there are many buyers which are foreign investors who perhaps have a relative or a child whom they have sent to Toronto for university some time ago and currently working in the GTA and thus when these people buy through their sons/daughter’s name, they are not considered foreign buyers (so artificially low foreign buyers numbers). This is seen when the foreign buyer tax was implemented and though the tax itself may not have impacted them, it’s a signal to investors that future gains will be slow and pushes them to try and exit the market.

    For downtown Toronto condos, I think the market consist of two groups. 1) Young families that cannot afford a SFH or wish to live the low maintenance easy downtown life 2) Investors buying condos to rent it out (and of course hoping to capitalize on cap gains as well). Group 1) are holding the market prices well and group 2) will hold on to their investments if cash flow isn’t too negative or only slightly positive. Rents are at record high for condos downtown, thus keeping the condo market strong. Having said that, with the sheer supply coming in and the record high prices, this segment is risky and some might just bite the bullet and move to SFH since the difference between SFH and condos have been narrowing since April 2017.

    • Brad 4 years ago

      Mind you the fact that a massive % can’t afford even a $200 monthly increase means that any economic slowdown and they have no choice but to sell… continued rate increases and they have no choice to sell.

      In my opinion it’s still going to take time for prices to drift lower and so I agree with you on that point. In general you see volume dry up first, and then inventory has to build up for months, sometimes 12-18, until the entire market is flooded, and at that point prices drift down or in the case of a recession or any economic hardship they crash. Right now we’ve had the massive volume decrease and continually drifting down, so it’s just sitting and waiting on inventory building and economic news.

      • Joe 4 years ago

        Brad, I read an article about people not being able to afford a $200 increase in mortgage some time ago as well but I really doubt this is the case when the time comes. Rents have definitely increased at least $200 a month YoY and people are still renting…when it comes to their home, people are willing to take extra shifts to keep their house. Unless there is a significant economic downturn where many become unemployed, the increase in mortgage payments due to increasing mortgage rates will not have a huge impact.

        In terms of inventory, we do see it building up due to decrease in sales but not at an alarming rate.

        Blue, that is true. There will be groups that have to sell and many are in the 905 region and of course some in the 416 region (more in the $2m+ range). People will come to their senses that they won’t be able to sell their houses at the peak but I don’t think the 33% example you used applies to the 416 region in general; especially not to the below $2m market. I do see houses selling much lower in North York (Willowdale/Lansing area) but that region experienced gains similar to Richmond Hill during the frenzy so it is expected that their drop will be more significant than other areas. But I guess we’ll see in the months to come!

    • Bluetheimpala 4 years ago

      the potential issue with this theory is that there will be groups who have to sell; over-leveraged, foreign investors, those who need to cash out. Much of this is related to interest rates but also the broader economy. As these sales firm up, the median drops and drops. Then offers come in below list and are accepted for ‘regular’ sellers who just want to move but are not really pressured. Unless there is a significant rebound in prices (hint: there won’t be fore 15-20 years) they will wake up in 24 months and be selling in a market they CANNOT move just through wishes and puppy dog kisses. The ‘market value’ will be set and unless you are insane, I doubt you are by your reasonable post, you are not going to pay a significant premium for a house when there are 5 others selling at the market value. You listing for $2M in a $1.5 market won’t lead to anything other than extensions and relists. You as a buyer wouldn’t pay 33% more for something just cuz 3 years earlier it was more right? That would be nuts. But maybe not, shits getting kray kray. Tick tock. BD4L.

  • ken 4 years ago

    $5 and the R/E board’s opinion will buy you a cup of coffee. Don’t try to make sense of their opinions or predictions. It has one purpose and that is to put a positive spin on markets, as much as possible.
    This in turn helps to maintain the maximum number of realtors paying monthly fees to brokers, which of course ultimately pads the pockets of the board itself.
    When you come to understand this is all about profit, and whatever shred of actual governance that occurs is just for show, you will understand the R/E industry and its governing bodies.

  • Contrarian 4 years ago

    I sold my house in downtown Toronto a few weeks ago, August, no open house, 60 showings during 6 days, 5 offers, 2 rounds, almost 50% over asking price. For me, no problem!

    • Rob 4 years ago



    • Joe 4 years ago

      Wow…what’s the address of that house? Never seen a house selling 50% over asking in this market…either you are bluffing or you listed way below market value.

    • SMH 4 years ago

      2 WEEKS AGO
      Just sold my semi-detached in downtown Toronto, total gut reno required, 6 day listing before offer date, no open house, no advertising only MLS, 60 showings, 5 offers, 2 round of offers, sold for 46% over asking, no conditions, 6 week closing. What bubble?”

      You posted this two weeks ago and we asked for the listing, which obviously you didn’t provide because IT NEVER HAPPENED. Please don’t post phantom anecdotes to try to pump RE, no one here believes you real agent estate TROLL. Prove me wrong and give us the receipts or try again in a few weeks to spout BS, I’ll still remember you.

  • D newman 4 years ago

    China. There I said it that will have the most effect on Canadian real estate prices going forward. It should be noted that trumps tariffs on China will cause the Canadian real estate market to crash Chinese have parked there money in different countries over the years investment pores in and investment pours out this will be no different

Comments are closed.