After a brief increase in home sales, boosted by a Bank of Canada rate cut in June, home buyers hit the pause button in July, says a new report from the Canadian Real Estate Association (CREA), which is forecasting more cuts this year. “With another rate cut announced on July 24, we’ve now seen two rate cuts in a row, and the expected pace of future policy easing has steepened considerably, with markets now anticipating rate cuts at every remaining Bank of Canada decision this year,” said Shaun Cathcart, CREA’s senior economist. “Combine that with a record amount of demand waiting in the wings, and the forecast for a rekindling of Canadian housing activity going into 2025 has just gone from a layup to a slam dunk.” The July rate cut took the bank’s overnight rate to 4.5%. With three more rate announcements scheduled for 2024 (September 4, October 23 and December 11) a minimum .25% cut on each date would take the rate to 3.75%. CREA says the decrease in sales in July from June, was minimal (0.7%) “Monthly changes in sales activity were generally small amongst the larger centres in July,” says the report. “Interestingly, declines in Calgary and the Greater Toronto Area were mostly offset by gains in Edmonton and Hamilton-Burlington.” The best news for potential buyers is an increase in homes listed for sale. CREA says at the end of July 2024, there were about 183,450 properties listed for sale on all Canadian MLS Systems, a 22.7% increase from last year, but in the neighbourhood of 10% below historical averages of more than 200,000 for this time of the year. Month-over-month, new listings increased a slight 0.9% from June, led by a much-needed boost in new supply in Calgary. “While it wasn’t apparent in the July housing data from across Canada, the stage is increasingly being set for the return of a more active housing market,” said James Mabey, chair of CREA. “At this point, many markets have a healthier amount of choice for buyers than has been the case in recent years, but the days of the slower and more relaxed house hunting experience may be somewhat numbered.".The National Composite MLS® Home Price Index (HPI) edged up 0.2% from June to July. While a small increase, it was slightly larger than the June increase, making it just the second, and the largest, gain in the last year, says CREA. “While prices were up slightly at the national level, they were held back by reduced activity in the largest and most expensive British Columbia and Ontario markets. Regionally, prices are rising in a growing majority of markets,” said Cathcart. “The non-seasonally adjusted National Composite MLS HPI stood 3.9% below July 2023. This mostly reflects how prices took off last April, May, June, and July, something that was not repeated over that same period in 2024. It’s mostly likely that year-over-year comparisons will improve from this point on.” “The actual (not seasonally adjusted) national average home price was $667,317 in July 2024, almost unchanged (-0.2%) from July 2023.” CREA cautions that average price information can be useful in establishing trends over time but does not indicate actual prices in centres comprised of widely divergent neighbourhoods or account for price differential between geographic areas. Statistical information contained in the CREA report includes all housing types.
After a brief increase in home sales, boosted by a Bank of Canada rate cut in June, home buyers hit the pause button in July, says a new report from the Canadian Real Estate Association (CREA), which is forecasting more cuts this year. “With another rate cut announced on July 24, we’ve now seen two rate cuts in a row, and the expected pace of future policy easing has steepened considerably, with markets now anticipating rate cuts at every remaining Bank of Canada decision this year,” said Shaun Cathcart, CREA’s senior economist. “Combine that with a record amount of demand waiting in the wings, and the forecast for a rekindling of Canadian housing activity going into 2025 has just gone from a layup to a slam dunk.” The July rate cut took the bank’s overnight rate to 4.5%. With three more rate announcements scheduled for 2024 (September 4, October 23 and December 11) a minimum .25% cut on each date would take the rate to 3.75%. CREA says the decrease in sales in July from June, was minimal (0.7%) “Monthly changes in sales activity were generally small amongst the larger centres in July,” says the report. “Interestingly, declines in Calgary and the Greater Toronto Area were mostly offset by gains in Edmonton and Hamilton-Burlington.” The best news for potential buyers is an increase in homes listed for sale. CREA says at the end of July 2024, there were about 183,450 properties listed for sale on all Canadian MLS Systems, a 22.7% increase from last year, but in the neighbourhood of 10% below historical averages of more than 200,000 for this time of the year. Month-over-month, new listings increased a slight 0.9% from June, led by a much-needed boost in new supply in Calgary. “While it wasn’t apparent in the July housing data from across Canada, the stage is increasingly being set for the return of a more active housing market,” said James Mabey, chair of CREA. “At this point, many markets have a healthier amount of choice for buyers than has been the case in recent years, but the days of the slower and more relaxed house hunting experience may be somewhat numbered.".The National Composite MLS® Home Price Index (HPI) edged up 0.2% from June to July. While a small increase, it was slightly larger than the June increase, making it just the second, and the largest, gain in the last year, says CREA. “While prices were up slightly at the national level, they were held back by reduced activity in the largest and most expensive British Columbia and Ontario markets. Regionally, prices are rising in a growing majority of markets,” said Cathcart. “The non-seasonally adjusted National Composite MLS HPI stood 3.9% below July 2023. This mostly reflects how prices took off last April, May, June, and July, something that was not repeated over that same period in 2024. It’s mostly likely that year-over-year comparisons will improve from this point on.” “The actual (not seasonally adjusted) national average home price was $667,317 in July 2024, almost unchanged (-0.2%) from July 2023.” CREA cautions that average price information can be useful in establishing trends over time but does not indicate actual prices in centres comprised of widely divergent neighbourhoods or account for price differential between geographic areas. Statistical information contained in the CREA report includes all housing types.
