Canadian real estate prices have yet to budge, but there’s a lot more inventory hitting the market. Canadian Real Estate Association (CREA) data shows new listings surged in July 2024. An army of sellers hit the market last month, sending new listings to grow at more than double the rate of sales. Some of the country’s biggest markets are now seeing double-digit growth, as sellers potentially overestimated the impact of rate cuts stimulating buyers.
Canadian Real Estate Listing Growth Doubled The Rate of Sales
Canadian real estate sellers must have been expecting a lot more activity last month. New listings hit 83,607 homes in July, up 12.7% from last year. The annual growth rate was more than double the 4.8% increase in sales over the same period, generally easing conditions across the country. However, not all markets have seen lofty inventory gains.
Canadian Real Estate Has Seen A Sudden Surge In New Listings
New listings of homes for sale on the MLS by city for July.
Source: CREA; Better Dwelling.
Windsor & Halifax Real Estate Saw The Biggest New Listings Surge
Eastern Canada was home to the most new listing growth. The Windsor-Essex region saw the biggest climb of any major market at 22.9% annual growth in July. It was followed by Trois Rivières CMA ( +21.9%), and Halifax-Dartmouth ( +20.1% ). It’s worth emphasizing that the top three markets all saw new listings increase by a fifth compared to last year.
Most Canadian Real Estate Markets Have Seen Inventory Rise
Annual growth of new listings of homes for sale on the MLS in July.
Source: CREA; Better Dwelling.
Only A Handful of Markets Saw Inventory Tighten
Leading the way for tighter inventory were two small markets, and a fast-growing Ontario city. Saint John (-9%) saw the sharpest contraction of any major market for new listings. It was followed by Saguenay (-7.4%), a relatively small city in Quebec. The exception to the small markets was the fast-growing region of London-St.Thomas, where new listings contracted 2.7% from last year.
Toronto & Vancouver Represented A Quarter of New Listings
Toronto and Vancouver, Canada’s two largest markets, both saw substantial upticks in new listings. Toronto reported 16,296 new listings in July, an increase of 18.8% from last year. The country’s largest real estate markets represented nearly 1 in 5 (19.5%) new listings last month.
In a very distant second was Greater Vancouver, which reported 5,491 new listings in July, up 16.7% from last year. The region was the second largest with 6.6% of monthly listings, highlighting how fast things have begun to loosen in Toronto.
The industry previously believed that rate cuts would kickstart the market. Investors, especially in regions like Toronto, expected this would be the case but unfortunately for them, buyers didn’t get the memo. Economists now see much sharper rate cuts required to stimulate the market, with the earliest impact not expected to materialize until next year. However, households may be in a very different space by next year, considering the rising mortgage delinquencies and erosion in the labor market.
Moar student visas for 50-year-old uncles from South Asia will help.
Toronto really standing out here. I wonder what it was like 5 years ago.
Toronto hasn’t seen anything like this in decades. Even rental vacancies are higher than they were back in 2018 (during the foreign buyer mini-crash).
Does the surge of listings in Toronto have anything to do with traffic now going the opposite way? I noticed rush hour is now incredibly light at the end of the day, but the traffic of people trying to get back into the city on the Gardiner looks rough almost every evening. Did the jobs just move out to the burbs?
That’s an interesting point but I’d wait till summer is over to see what is going down. Everything changes in the summer traffic wise.
Most manufacturers and their supporting tier industries moved West pass Mississauga to access closer to their $$$ customers (US) while staying close ish to the skilled labour force in the GTA. Thus compounding the 401/QEW traffic at all hours. Throw in(out) the 407, it’s the most congested highway system in North America. A lot of places are challenged to fill positions due to insufficient pay to attract skilled workers due to high rental costs. It’s definitely a death loop happening when you cannot meet growth targets when the budgeted growth cannot pay for the people to support the growth. Existing staff are asked to double work for the same pay with little raises. Thus our “productivity crisis”. Workers are calling BS vs the owner class.
Thar she blows! Glad some people are finally getting some sense. It’s not a pretty site out there but people in small towns have been absolutely delusional about how fast it’s growing.
Talk to a Realtor in Halifax. They think it’s just weeks away from being Manhattan. LOL
They probably came from Ontario and think Toronto is a world class city as well.
Everyone who lived through 1989 saw this coming. Remember out west “jingle-mail”? Well, this is the beginning of the end of the real estate boom in Canada. How can you believe that real estate prices can go up 10-15% year over year and not have a correction. The funny thing was is that back in 2017 they started talking about it, and because it didn’t happen in 2018 or 2019 many people figured that it would never happen. Now some lucky enough to see the writing on the wall managed to get out while their friends were laughing at them for “selling too soon” (had that happen to myself and my wife) but now they are crying because the “paper gain” on their home just evaporated in 18 months and their mortage payment is up 25%. No sympathy – you want to be greedy? This is what you get. Problem is our youth and middle class are going to pay the price. Prices will come down, but nothing in real estate goes quickly….ask anyone who has ever built a house. If you don’t believe that, ask anyone selling a house in a market where prices drop 2-5% every quarter. It hurts….
If I could like this comment I would. The only sales I see in my area are investors buying large houses to chop them up into rooming houses. It’s been like that for a while. Take them out and sales are extremely lean for families. It’s going to have to depreciate a lot further for regular market conditions to return and we are on our way. It’s the agents that are slowing it down at the moment but even they will eventually have to pay their bills.
Who’d have expected this in a market where price is an abstract concept, detached from any underlying fundamental, and set by realtors via metaphysical connection or shroom microdosing.
The housing market is the economy in Canada. Lower house prices people feel poorer, spend less. Unemployment goes up, spend less, mortgage rates up, spend less. more unemployment spend less. A few points in the interest rates will not fix this.
Most buyers now know the market is going down. Dropping prices at the moment mean houses are not affordable regardless of what the banks are saying. Few buyers can afford to risk a capital loss. Prices are about to fall off a cliff. Currently we are in the frustrated sellers position where sellers cannot get the price they want or need. Soon it will be sell at any cost and get out before prices fall further. Way too many listings and very few buyers.
There’s still a housing shortage. With rates coming down, variable mortgages are hot topic. To say prices will completely have the bottom fall out , well, maybe in some markets. Toronto’s prices (And Vancouver)
reflect an era of money laundering where “investors” outbid families for the sake of greed. Now that there is a ton of listings, serves them right to feel pain that they too have caused regular families not to mention upending the market.
With housing a whopping 8% of Canada’s GDP compare to US at 4% , the feds can’t afford to have the bottom fall out completely while we already have a productivity crisis coupled with record immigration that’s diluted the fact we have been in a recession for many months already. And don’t forget about the home equity tax in the wind. The Capital gains increase was a bust, the PBO says it will yield 40% of what was expected. Seeing as the middle class is completely tapped out, there is nowhere else to turn but tax home equity. All this should come as no surprise, after all, budgets balance themselves.
Demand needs to be qualified. There’s shortage of Ferrari’s if we’re only going by the volume of people who want one, and not the amount that can pay for one.
There’s also the issue where Canada likely overstated immigration by almost 40%, which is still a big number—just not the kind of adjustment people think they’re seeing.
The party is over, 10 years of stagnet home prices to catch up to inflation .