Canadian Housing Monitor: January 2025
Toronto vs. Everybody
Canada’s housing market was flashing very mixed conditions at the end of 2024. While Ontario remains very soggy, and the Toronto condo market is awash in supply with prices falling, much of the country is firm. Prices in at least 10 major markets are pushing cycle highs while those across most of Ontario are hardly off the floor. We expect further increases in sales volumes and modest national price gains through 2025.
Existing home sales fell 5.8% in seasonally-adjusted terms in December, but were still up a strong 19.2% from year-ago levels. Sales volumes are now running almost right in-line with the 10-year average. Keep an eye on activity as Q1 data roll out given the easing of mortgage rules that took place in mid-December. Note that for all of 2024, the total value of sales rose 8.2% in dollar terms, and it was still the third most 'valuable' year for Canadian real estate activity on record, behind 2021 and 2022.
New listings are still elevated and up 10.4% y/y, but inventory is not building on a national basis. The months’ supply of homes for sale on the market rose to 3.9 in December, just about in-line with the 4.0 average of the past year. The national sales-to-new listings ratio is still firmly in balanced territory at 56.9%, although loosening in December.
Balanced overall market conditions leave price trends stable to modestly improving. The MLS benchmark price rose 4.1% annualized in December but was still down 0.2% from a year ago. Barring another economic shock, it looks like the market is set up for modest national price growth this year.
The real story is that conditions vary greatly by region and segment, and Toronto (namely the condo market) is being left behind. Toronto is the last remaining buyers' market among 23 major cities we track, with the sales-to-new listings ratio weakening to 38.6% in December. The glut of condos hitting the resale market in that city is clearly marking the weak spot in Canadian real estate, with prices down 3.7% y/y in that segment. Most of Southern Ontario is also still relatively soft.
On the flip side, markets in Quebec and further east are tight almost across the board as steadily rising sales outpace increases in new listings. There are now less than 4 months of supply in each of Quebec, New Brunswick and Nova Scotia.
Calgary, Edmonton, Regina and Winnipeg also all sport strong sellers’ markets and continue to outperform national averages for market balance and price growth. Prices in these markets have all returned to record highs relative to the recent correction.
Activity and price trends in British Columbia fit somewhere in Between Ontario and the rest of Canada—that is, not nearly as strong as the Prairies and Atlantic regions, but not struggling as much as Ontario. In Vancouver, the benchmark price has recovered just over half of the decline seen during the post-2022 correction, but is still about 4% shy of the peak.
The bottom line here is that there is a big disconnect materializing between conditions in Ontario and most of the rest of the country. When we hear about swampy market conditions and stagnant prices well off the 2022 peak, that is largely an Ontario story, and even more specifically a condo story. At the same time, there are now regions of the country where housing market activity and resale prices are legitimately strong.
Robert Kavcic
Director and Senior Economist
