Canadian real estate’s recovery hit pause last month—and maybe even rewound a bit. Canadian Real Estate Association (CREA) data shows that home prices slipped in August. Weak sales, sticky inventory, and economic uncertainty have led to the weakest demand balance in nearly 30 years.
Canadian Real Estate Prices Fall For A Third Month
The price of a typical home across Canada.
Source: CREA; Better Dwelling.
The price of a typical home slipped 0.7% (-$4.3k) to $657,500 in August, marking a third month lower. Prices are now 3.0% (-$20.4k) lower than last year and sit 21.8% (-$183.6k) below the March 2022 peak. Prices are now back to where they were in January of this year, roughly the same as they were back in February 2021.
Canadian Home Sales Just Had The Weakest August Since 2012
Non-seasonally adjusted home sales through the MLS in August.
Source: CREA; Better Dwelling.
Existing home sales slipped 6.9% from last year to 37,504 units in August. It wouldn’t be a particularly noteworthy drop on its own, but sales were already weak. The compounding erosion has led to the weakest August since 2012.
Canadians Are Still Listing Homes For Sale In Record Volumes
New listings of homes for sale on the MLS in August.
Source: CREA; Better Dwelling.
Sellers are still out in full force, though there was a small pullback in the volume. CREA reported 74,028 new listings in August, 3.2% lower than last year. It was still the second-highest volume for August since 2020, and the third-highest in at least 20 years of data. New listings might have slipped lower, but inventory is still at one of the highest levels on record.
Canadian Real Estate Demand Balance Falls To 29-Year Low
The sales to new listings ratio (SNLR) for August.
Source: CREA; Better Dwelling.
The board reported a SNLR of 50.7% in August, down 2 points from last year and a big change from the 76.9% at the August 2021 peak. In a local market, this would be considered a balanced reading where buyer and seller demand are equal. Averaged across the country, the meaning is less clear and needs some context. Last month’s SNLR was the weakest for August since 1997, nearing a generational low.
Home buying remains unusually weak and inventory remains lofty—it’s easy to see why. Buyers are already jittery in this environment, and economic uncertainty due to trade war escalation isn’t helping. Add to that upward pressure on financing costs, which at least one bank expects to push prices lower.
“okay, NOW it’s the bottom.”
— RBC’s 28th try since 2022 (or close to)