July 9, 2024
Canadian Housing Market Shows Signs of Recovery in June 2024
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The Canadian housing market displayed signs of recovery in June 2024, with major cities experiencing an uptick in home sales compared to the previous month. This positive trend comes on the heels of the Bank of Canada’s recent rate cut, which has provided some relief to homeowners and potential buyers. However, experts caution that the market remains sluggish by historical standards, and further rate cuts may be necessary to stimulate significant growth.
| City | Sales YoY Change | Benchmark Price | New Listings YoY Change | Active Listings YoY Change |
|---|---|---|---|---|
| Toronto | -16.4% | $1,162,167 | +12.3% | +67.4% |
| Vancouver | -19.1% | $1,207,100 | +7% | +42% |
| Montreal | +6% | $451,000 | +6% | +25% |
| Calgary | -12.8% | $608,000 | -3.6% | +9.2% |
| Ottawa | +0.1% | $647,700 | +4.7% | +45.5% |
National Overview
The housing market in Canada's largest cities saw a modest increase in activity during June 2024. Toronto, Vancouver, and Montreal all reported rises in home sales compared to May, marking the first monthly increase in several months for these key markets. This upturn suggests that the Bank of Canada's rate cut has had some impact on buyer sentiment, albeit limited.
Despite this positive movement, year-over-year comparisons reveal that the market is still considerably weaker than in 2023:
| City | Year-over-Year Sales Change |
|---|---|
| Toronto | -16% |
| Vancouver | -19% |
| Calgary | -13% |
These figures underscore the ongoing challenges faced by the Canadian housing market, including affordability issues and the lingering effects of higher interest rates.
Canadian Housing Market Timeline: 2024
```Regional Market Analysis
Greater Toronto Area (GTA)
The Toronto Regional Real Estate Board (TRREB) reported the following statistics for June 2024:
| Metric | Value | YoY % Change |
|---|---|---|
| Sales | 6,213 | -16.4% |
| Benchmark price (all housing types) | $1,162,167 | -1.6% |
| New listings | 17,964 | +12.3% |
| Active listings | 23,613 | +67.4% |
Key Takeaways:
- Sales remain significantly lower than last year
- Benchmark prices have decreased slightly
- Substantial increase in both new and active listings
TRREB Chief Market Analyst Jason Mercer noted, "The GTA housing market is currently well-supplied. Recent home buyers have benefitted from substantial choice and therefore negotiating power on price."
Greater Vancouver Area
The Greater Vancouver Realtors (GVR) provided the following data for June 2024:
| Metric | Value | YoY % Change |
|---|---|---|
| Sales | 2,418 | -19.1% |
| Benchmark price (all housing types) | $1,207,100 | +0.5% |
| New listings | 5,723 | +7% |
| Active listings | 14,182 | +42% |
Key Insights:
- Sales are nearly 25% below the 10-year average
- Benchmark prices have remained relatively stable
- Significant increase in active listings
Andrew Lis, Director of Economics and Data Analytics at GVR, commented, "This dynamic is bringing inventory levels up to a healthy range not seen since before the pandemic. This trend is providing buyers more selection to choose from and driving all market segments toward balanced condition."
Montreal Census Metropolitan Area
The Quebec Professional Association of Real Estate Brokers (QPAREB) reported the following for Montreal in June 2024:
| Metric | Value | YoY % Change |
|---|---|---|
| Sales | 7,762 | +6% |
| Median Price (single-family detached) | $451,000 | +4% |
| Median Price (condo) | $380,000 | +4% |
| New listings | 11,056 | +6% |
| Active listings | 38,701 | +25% |
Notable Trends:
- Montreal shows positive year-over-year growth in sales
- Modest price increases across property types
- Substantial rise in active listings
Calgary
The Calgary Real Estate Board (CREB) provided the following statistics for June 2024:
| Metric | Value | YoY % Change |
|---|---|---|
| Sales | 2,738 | -12.8% |
| Benchmark price (all housing types) | $608,000 | +8.5% |
| New listings | 3,798 | -3.6% |
| Active listings | 3,787 | +9.2% |
Key Observations:
- Calgary stands out with significant price growth
- Sales have decreased, but remain above long-term trends
- Competitive market conditions persist in some segments
CREB chief economist Ann-Marie Lurie noted, "It also continues to be a competitive market for some buyers with over 40% of the homes sold selling over list price."
Ottawa
The Ottawa Real Estate Board (OREB) reported the following for June 2024:
| Metric | Value | YoY % Change |
|---|---|---|
| Sales | 1,439 | +0.1% |
| Benchmark price (all housing types) | $647,700 | -0.5% |
| New listings | 2,469 | +4.7% |
| Active listings | 3,585 | +45.5% |
Key Points:
- Sales have remained relatively stable year-over-year
- Slight decrease in benchmark prices
- Significant increase in active listings
OREB President Curtis Fillier commented, "Unlike recent years, buyers have more room to wait, evaluate and be selective when searching for the right property at the right price, leading to a slight uptick in the days on market."
Factors Influencing the Market
Several key factors are shaping the current Canadian housing market:
- Interest Rates: The Bank of Canada's recent rate cut has provided some relief, but experts suggest that further cuts may be necessary to significantly boost market activity.
- Supply and Inventory: Most major markets are experiencing increases in active listings, providing more options for buyers and potentially tempering price growth.
- Affordability: Despite some price moderation, affordability remains a significant challenge in many markets, particularly for first-time buyers.
- Economic Conditions: Strong population growth and a robust job market are providing underlying support for housing demand.
- Regional Variations: Markets like Calgary are showing resilience with price growth, while others like Vancouver are experiencing more pronounced slowdowns.
Future Outlook
While the June data shows some signs of improvement, the Canadian housing market still faces several challenges. Experts suggest that the following factors will be crucial in shaping the market's trajectory:
- Further Interest Rate Cuts: Many analysts believe that additional rate cuts will be necessary to stimulate significant market activity. TRREB's polling suggests that a 100 basis point reduction may be required to boost sales substantially.
- Supply-Demand Balance: The current increase in inventory levels may help moderate price growth and create more balanced market conditions.
- Economic Performance: The overall health of the Canadian economy, including job growth and inflation rates, will play a crucial role in housing market performance.
- Government Policies: Any new housing-related policies or incentives introduced by federal or provincial governments could impact market dynamics.
Strategies for Buyers and Sellers
Given the current market conditions, buyers and sellers may want to consider the following strategies:
For Buyers:
- Take advantage of increased inventory to explore more options
- Be prepared for potential competition in hot markets like Calgary
- Consider the long-term implications of interest rates when making purchasing decisions
- Work with a local real estate professional to navigate market-specific conditions
For Sellers:
- Price properties competitively, especially in markets with high inventory
- Highlight unique features of the property to stand out in a crowded market
- Be prepared for potentially longer selling times in some markets
- Consider timing the sale to coincide with potential future rate cuts
Conclusion
The Canadian housing market in June 2024 shows early signs of recovery, with increased sales activity in major cities compared to the previous month. However, the market remains subdued compared to historical norms and the previous year's performance. The recent interest rate cut by the Bank of Canada has provided some stimulus, but further cuts may be necessary to drive significant growth.
Regional variations continue to play a significant role, with markets like Calgary showing resilience in price growth, while others like Vancouver experience more pronounced slowdowns. The increase in inventory levels across most markets is providing more options for buyers and potentially moderating price growth.
As the market continues to evolve, both buyers and sellers will need to stay informed about local conditions and broader economic factors to make well-informed decisions. While challenges persist, the Canadian housing market's fundamental strengths, including strong population growth and a robust job market, provide a foundation for potential recovery in the coming months.
Disclaimer: This article is based on data available as of June 2024 and should not be considered as financial advice. Always consult with a qualified real estate professional or financial advisor before making any real estate decisions.
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