The Canadian Real Estate Association (CREA) has released its 30,000-ft. overview of housing markets in the country in May compared to April, showing a 0.6% slowdown in sales, a 0.2% drop in the home price index while new listings increased marginally by 0.5%. “The result of slower sales amid more new listings this year has been an increasing number of homes for sale across a majority Canadian housing markets,” said Shaun Cathcart, CREA’s senior economist. “As of the end of May 2024, there were about 175,000 properties listed for sale on all Canadian MLS Systems, up 28.4% from a year earlier but still below historical averages.” With sales down slightly and new listings up a little in May, the national sales-to-new listings ratio eased to 52.6% compared to 53.3% in April. The long-term average for the national sales-to-new listings ratio is 55%. A sales-to-new listings ratio between 45% and 65% is generally consistent with balanced housing market conditions. Year-over-year, the national average sale price declined 4% in May. Regionally, prices are generally sliding sideways across most of the country, said CREA, the exceptions being Calgary, Edmonton and Saskatoon, where prices have steadily ticked higher since the beginning of last year. The national average home price was $699,117 in May 2024, down 4% from May 2023. “May was another sleepy month for housing activity in Canada, although it may prove to be the last of those now that interest rates have moved lower,” said Cathcart. “The Bank of Canada’s June 5 rate cut may have only been 25 basis points, but the psychological effect for many who have been sitting on the sidelines was no doubt huge. The question now turns to further rate cuts, specifically, how fast and how far?” It was a slow start to the spring selling season, but James Mabey, chair of CREA, expects to see more activity now that the Bank of Canada’s rate reduction. “The spring housing market usually starts before all the snow has melted, somewhere around the beginning of April, but this year I believe a lot of people were waiting for the Bank of Canada to wave the green flag,” said Mabey. “That first rate cut is expected to bring some pent-up demand back into the market and those buyers will find there are more homes to choose from right now than at any other point in almost five years.”
