Canadian Home Sales Maintain Upward Trend in July

National home sales continued to climb in July, driven again by the Greater Toronto Area.

While transactions in the region were still historically low, they have now rebounded a cumulative 35.5 per cent since the kick off of spring.

Nationwide, home sales rose 3.8 per cent from June, building on gains recorded over the previous three months. Transactions have increased altogether 11.2 per cent from March.

“With sales posting a fourth consecutive increase in July, and almost four per cent at that, the long-anticipated post-inflation crisis pickup in housing seems to have finally arrived,” says Shaun Cathcart, senior economist with the Canadian Real Estate Association (CREA). “Looking ahead a little bit, it will be interesting to see how buyers react to the burst of new supply that typically shows up in the first half of September.”

New supply was little changed month-over-month in July. Combined with the notable increase in sales, the national sales-to-new listings ratio rose to 52 per cent, up from 50.1 per cent in June, and 47.4 per cent in May.

The long-term average for the national sales-to-new listings ratio is 54.9 per cent, with readings roughly between 45 and 65 per cent generally consistent with balanced housing market conditions.

There were 202,500 properties listed for sale on all Canadian MLS systems at the end of July, up 10.1 per cent from a year earlier and in line with the long-term average for that time of year.

“Activity continues to pick up through the transition from the spring to summer market, which is the opposite of a normal year — but this has not been a normal year,” says CREA chair Valérie Paquin. “It seems like buyers are increasingly returning to the market.”

At the end of July, there were 4.4 months of inventory on a national basis, dropping further below the long-term average of five months as sales continue their upward trajectory. This is indicative of a balanced market. Based on one standard deviation above and below that long-term average, a seller’s market would be below 3.6 months and a buyer’s market would be above 6.4 months.

Despite the increase in sales activity, prices were unchanged between June and July. Following declines in the first quarter of the year, the national benchmark price has remained mostly stable since May.

Compared to July 2024, prices were down 3.4 per cent. This was a smaller decrease than the one recorded in June.

Based on the extent to which prices fell off in the second half of 2024, CREA expects year-over-year declines to continue to shrink in the months ahead.