Real Estate

Canadian Housing Market Outlook 2024

Canadian Housing Market Outlook 2024

Table of contents


    National Market Report Summary

    • The average selling price of a home in Canada decreased by 3.4% year-over-year to $730,600 in May 2024.
    • The average selling price of a single-family home in Canada decreased by 3.2% year-over-year to $808,700 in May 2024.
    • The average selling price of a townhouse/multiplex in Canada decreased by 2.9% year-over-year to $672,100 in May 2024.
    • The average selling price of a condo in Canada decreased by 2.7% year-over-year to $529,100 in May 2024.
    • The average rent in Canada increased by 9.0% year-over-year to $2,146 for May 2024

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    Composite Home Prices

    The average selling price of a home in Canada was $730,600 for the month of May 2024, that’s decreased by 0.4% compared to the previous month. On a year-over-year basis, Canadian home prices have decreased 3.4% over the last 12 months.

    Single-family Home Prices

    The average selling price of a single-family home in Canada was $808,700 for the month of May 2024, that’s decreased by 0.3% compared to the previous month. On a year-over-year basis, single-family home prices in Canada have decreased by 3.2% over the last 12 months.

    Townhouse and Multiplex Prices

    The average selling price of a townhouse in Canada was $672,100 for the month of May 2024, that’s decreased by 0.4% compared to the previous month. On a year-over-year basis, the price of a townhouse in Canada has decreased by 2.9% over the last 12 months.

    Condo Prices

    The average selling price of a condo in Canada was $529,100 for the month of May 2024, that’s decreased by 0.6% compared to the previous month. On a year-over-year basis, the price of a condo in Canada has decreased 2.7% over the last 12 months.

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    Canada Housing Market Summary

    Data from the Canadian Real Estate Association (CREA) indicates that the benchmark price of resale residential homes sold across Canada in May 2024 was $730,600, and it decreased by 3.4% compared to a year ago.

    CREA also reported a sales-to-new-listings ratio (SNLR) of 56%, indicating a balanced market nationally for May 2024.

    For May 2024, the Canadian Real Estate Association (CREA) reported a decrease in national home sales, but they expect growth in June following the central bank’s interest rate cut. The real estate market was impacted by the anticipation of the rate cut, with existing home sales dropping by 0.6% from April to May. The average price of homes also decreased by 0.2% to $714,300, a 5.9% decrease from the previous year. Existing home sales are now 13% below the 10-year average.

    The weakening sales-to-new-listings ratios (SNLR) caused a 4% drop in the average national home price to $699,117 in May. The number of new listings increased by 0.5%, leading to the highest number of available homes for sale since fall 2019. By the end of the month, there were 4.4 months of inventory remaining.

    British Columbia had the highest annual home price change in May, followed by Ontario, Quebec, and Alberta. The housing market has been quiet for 2 years, with sales and prices declining or staying the same. However, Calgary, Edmonton, and Saskatoon have seen steady price increases. New housing starts in May increased by 10% compared to April, with each new home needing $100,000 for infrastructure funding.

    The MLS Home Price Index (HPI) decreased by 0.2% from last month and is 2.4% lower than last year. Despite this, the recent rate cut by the Bank of Canada is expected to boost the market, leading analysts to predict a busier market in June and assuring buyers that interest rates may drop.

    Shaun Cathcart, a senior economist at CREA, highlighted the psychological impact on observers and expects a more robust performance in June due to lower bond yields. The potential for rate cuts from the Bank of Canada could lead to a more robust second half in 2024.

    James Mabey, chair of CREA, said the Bank of Canada’s interest-rate cut was expected to boost market demand. However, real estate agents have not seen the anticipated surge in demand. Royal LePage president Phil Soper described the market response as lacklustre. Despite predictions of increased home sales and rising prices, the impact has been underwhelming.

    Transactions –  Number of Sales

    The number of sales in Canada was 39,954 during May 2024, that’s increased by 3.7% compared to the previous month. On a year-over-year basis, sales in Canada have decreased by 1.2% over the last 12 months.

    New Listings

    The number of new listings in Canada was 71,033 during May 2024, that’s increased by 1.5% compared to the previous month. On a year-over-year basis, new listings in Canada have increased by 11.7% over the last 12 months.

    Real Estate Market

    The sales to new listings ratio (SNLR) in Canada was 56% during May 2024, indicating a balanced market. On a monthly basis, that’s increased by 2.2% compared to the previous month. Canada’s yearly sales to new listings ratio has decreased by 11.6% over the last 12 months.

    The sales to new listings ratio (SNLR) measures the number of home sales compared to new listings. An SNLR under 40% suggests a buyer’s market in which buyers have the upper hand and more negotiating power. An SNLR between 40% and 60% is a balanced market, while an SNLR of over 60% is considered a seller’s market. 

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    Annual Changes Composite Home Prices by Province

    Annual Changes to the National Composite Home Prices

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    Canadian Rental Market

    According to the National Rental Report for May 2024, average rent prices in Canada hit a record high of $2,202, surpassing $2,200 for the first time. The increase of 9.3% from the previous year matches April’s growth rate and aligns with the 9.1% annual growth rate over the past 3 years. Despite rent declines in 2020 and 2021, the average yearly growth over the past 5 years was 4.7%. May’s rent rose by 0.6% from the previous month, consistent with the growth in May of the prior year. Overall, average asking rents have increased by 0.4% over the past 3 months.

    Rent prices for purpose-built and condo rental apartments rose by 10.6% annually in May, with an average rent of $2,143. Purpose-built rentals increased by 13.7% compared to condo rents, which grew by 3.4%. Condo rents dropped by 0.8% month-over-month to an average of $2,312, while purpose-built rents increased by 1.0% monthly to an average of $2,146.

    All provinces experienced annual rent increases for purpose-built and condo rentals. Ontario had a 0.6% gain, reaching an average rent of $2,423, while B.C. had the highest average rent of $2,526 with a 2.3% annual growth. Ontario and B.C. also saw month-over-month rent increases of 0.7% and 0.8% in May, respectively.

    Quebec apartment rents dropped by 0.6% to $1,999 in May but increased by 6.7% from last year. Nova Scotia, Alberta, and Saskatchewan contributed to Canada’s annual rent inflation, with increases of 17.1%, 17.5%, and 21.4%, respectively. British Columbia’s 3-bedroom apartment rents declined by 3.2% to $3,242, while Ontario’s 1-bedroom unit rents slightly decreased by 0.3% to $2,196. Alberta and Saskatchewan grew fastest in 3-bedroom apartment rents, with increases of 21.3% and 24.2%, respectively.

    Canadian rental market changes saw Edmonton experience the most significant overall rent declines. Vancouver and Toronto saw decreases in 1-bedroom and 3-bedroom apartments, while Ottawa, Calgary, Montreal, and Edmonton saw increases in 3-bedroom rents. Vancouver and Toronto rents declined in May: Toronto rents dropped by 0.9% compared to last year, and Vancouver rents were down by 4.1%. Both cities saw asking rents increase to 3-month highs, but Toronto rents are still 4.4% lower than their peak in November 2023, and Vancouver rents are 9.9% lower than their peak in July 2023. Lloydminster is the fastest-rising rental market: Apartment rents increased by 29.3% from last year. The top 5 most expensive small—and mid-sized cities for average rents in May were in British Columbia, with the remaining top 10 cities in Ontario.

    In May, shared accommodations in Toronto and Ottawa increased by 8.4% annually to $992. British Columbia and Ontario had the highest average rents for roommates at $1,191 and $1,069, respectively. Alberta saw the most significant rent increase over the past year, rising 9.6% to $883. However, Toronto and Ottawa experienced slight decreases in roommate rents compared to the previous year, with Toronto declining by 3.2% to $1,257 and Ottawa decreasing by 1.2% to $936. Calgary had the most substantial annual growth in shared accommodation rents in May, increasing by 8.5% to $915. Vancouver maintained the highest average asking rents for shared accommodations at $1,469, a 2.5% increase.

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    Canada Market Rents Summary

    The average rent in Canada was $2,146 for the month of May 2024, which increased by 9.0% on a year-over-year basis.

    The average rent for a bachelor apartment in Canada was $1,624 for the month of May 2024, which increased by 13.0% on a year-over-year basis.

    The average rent for a 1-bedroom apartment in Canada was $1,951 for the month of May 2024, which increased by 8.0% on a year-over-year basis.

    The average rent for a 2-bedroom apartment in Canada was $2,358 for the month of May 2024, which increased by 10.0% on a year-over-year basis.

    The average rent for a 3-bedroom apartment in Canada was $1,951 for the month of May 2024, which increased by 10.0% on a year-over-year basis.

    How Does Renting Compare with Homeownership in Today’s Housing Market?

    Each $100,000 in mortgage balance costs an average of $555.70 per month on nesto’s lowest fixed 5-year rate at and $623.08 per month on nesto’s lowest adjustable 5-year rate at . For each $100,000 in mortgage balance, a 0.25% change in Canada’s policy rate impacts the monthly payment by $15. Rates used for calculation are those offered on insured purchases with less than a 20% downpayment on a 25-year amortization. Canada’s policy rate is , and nesto’s prime rate is .

    Rental Price Changes by City

    Rental Price Changes by Province

    Rental Price Growth by Housing Type

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    Frequently Asked Questions

    Will 2024 be a good time to buy a house?

    Despite the uncertainty in the housing market, 2024 could be an excellent time to buy a house. Interest rates and housing prices are likely to reduce while wages rise – a combination that means more buying power.

    Is Canada in a housing bubble, and will it burst?

    Canadian real estate prices have risen spectacularly since 2000, and with the current pandemic and inflationary pressures, there is speculation that Canada may be bottoming out of a housing bubble. However, experts are mixed on whether or not this bubble will burst; some think prices may take a dip but stay relatively stable, while others expect prices to fall further.

    Should I wait to get a mortgage in 2024?

    Whether or not you wait to get a mortgage in 2024 depends mainly on your financial circumstances. Consider the current market conditions and forecasts and factor them into your financial and long-term plans. It’s also important to remember that waiting may mean missing out on specific opportunities – especially once mortgage rates start reducing. 

    Why Choose nesto

    At nesto, our commission-free mortgage experts, certified in multiple provinces, provide exceptional advice and service that exceeds industry standards. Our mortgage experts are non-commissioned salaried employees who provide impartial guidance on mortgage options tailored to your needs and are evaluated based on client satisfaction and advice quality. nesto aims to transform the mortgage industry by providing honest advice and competitive rates using a 100% fully digital, transparent, seamless process.

    nesto is on a mission to offer a positive, empowering and transparent property financing experience – simplified from start to finish.

    Contact our licensed and knowledgeable mortgage experts to find your best mortgage rate in Canada.

    EXPLANATIONS

    Interest Rates

    Property Values

    Home Price Index

    Property Types

    Property Ownership Classes

    Strata Insurance

    Rental Values

    Qualifying Criteria

    Professional Titles

    Mortgage Experts

    Interest Rates

    Qualified using nesto’s fixed 5-year insured and uninsured rates as advertised on our website. For today, Wednesday, July 17, 2024, our example calculations are qualified on our lowest rates, which may or may not apply to your unique financing situation or long-term goals. Insured fixed-rate mortgages will be qualified at , which is exactly 2% in addition to our fixed insured rate currently at . Uninsured fixed-rate mortgages will be qualified at , which is exactly 2% in addition to our fixed uninsured rate currently at . Insured variable rate mortgages will be qualified at , which is exactly 2% in addition to our variable insured rate currently at . Uninsured variable rate mortgages will be qualified at , which is exactly 2% in addition to our variable uninsured rate currently at .

    We appreciate your patience and understanding and encourage you to email us at website@nesto.ca with information that needs correction alongside your sources.

    Property Values

    Home values collected from CREA or QPAREB are those presented as the composite benchmark or average prices for each city/province/region unless specified. They may be interchangeably called average home prices, though an average price may not be available for many regions outside Quebec.

    MLS® Home Price Index (HPI)

    The MLS® Home Price Index (HPI) is a real estate price index compiled by the Canadian Real Estate Association (CREA) that tracks the price of homes in your neighbourhood. It’s a quick way for Canadians to compare home prices in different parts of Canada and between different periods without having to factor in the unique characteristics of a particular property.

    While market prices can vary from one month to the next based on seasonal factors, the Home Price Index (HPI) provides a more consistent view and tracks price trends over an extended period. The Home Price Index (HPI) is updated annually in May to reflect changes in real estate markets.

    MLS® HPI is the most comprehensive and precise way to track a neighbourhood’s home price level and trends. MLS HPI uses over 15 years of data from the MLS® System and advanced statistical models to create a “typical” home based on the characteristics of homes purchased and sold. This benchmark home is tracked across all Canadian neighbourhoods and various types of homes.

    Property Types

    Detached homes, also known as single-family homes, are residential properties that stand alone and are not connected to other buildings. They are legal single residential units on their own parcel of land and have a separate title.

    Semi-detached homes are characterized by their unique architectural design. Two houses are built side by side and share a common wall. Although sharing a building, semi-detached homes have their own parcel of land and separate legal titles.

    Townhouses are residential dwellings typically characterized by narrow, tall structures, often sharing walls with neighbouring units. Although they may share yards or common elements with their neighbours, townhouses will have separate legal titles from any adjoining building. Townhouses can be purchased as freehold or leasehold within a condo or strata and may come with their own land parcel. Townhouses can be part of a low-rise or high-rise building.

    Condo apartments, also known as condominiums, are residential properties that combine elements of apartments and individual homes. It is a unit within a larger building or complex owned by an individual who also shares ownership of common areas and amenities with other residents. Condo apartment owners have legal ownership of their units and can modify them within the guidelines set by the condominium association. Unlike a townhouse, condos do not offer exclusive use of outdoor space unless they come with a balcony or terrace. Condos can be part of a low-rise or high-rise building.

    Plexes or multiplexes are unique residential buildings constructed into 2 to 6 units within a single structure. Traditionally, they have been designed as low-rise residential buildings where any unit is accessible via an external entrance with higher floors connected by staircases. Each unit will have a separate registration and title but may share common elements and co-ownership fees with the other multiplex owners. Plexes are common in Québec and older parts of Toronto.  

    Property Ownership Classes

    freehold is a type of property ownership where an individual or entity has complete and indefinite ownership rights over a property and its parcel of land. Common freehold property types include detached houses, semi-detached houses, farms, and townhouses, which are not part of condominium corporations.

    condominium or condo is a distinct type of property class that combines apartment living and individual homeownership elements. In a condominium, individual units are owned by the residents, while the common areas and amenities are shared among all the unit owners. This type of ownership gives you rights to your specific unit and some rights and responsibilities to the common areas, such as the hallways, elevators, garage, pool and rooftop patios.

    leasehold is a legal arrangement where a person or entity holds the right to use and occupy a property for a specific period, typically through a lease agreement. In some cases, the leaseholder may own the building or unit and rent the land from the landowner (landlord).

    Strata insurance

    Strata insurance is insurance that a strata or condominium uses to cover damages to common areas, assets and liabilities to the strata. It can also include fixtures built or installed as part of the original construction of each unit, even though these may not be common structures. Strata insurance can cover the following:

    • Buildings and structures on the strata’s property, including common areas such as the garage, roof, lobby, pool, etc.,
    • Liabilities for any property damage or bodily harm due to an injury suffered on a strata property,
    • Which also includes fixtures in the standard unit or part of the original make of each unit.

    Strata insurance generally does not cover personal belongings and appliances in a condo unit. Damage caused by individual unit owners (e.g., water damage due to a unit owner’s negligence) is typically covered under personal condo insurance.

    Rental Values

    Our monthly or year-over-year rental averages are sourced from Urbanation’s monthly Rentals.ca National Rental Report.

    Mortgage Qualifying Criteria

    Insured qualifying criteria are limited to a 39% gross debt service (GDS) ratio and up to 25 years of amortization. For insured mortgage transaction calculations, we have used a 20% downpayment, unless otherwise indicated, in our examples and excluded any mortgage default insurance (CMHC) premium. Uninsured qualifying criteria are limited to a 35% gross debt service (GDS) ratio and up to 30 years of amortization. Our examples use a 20% downpayment for uninsured mortgage transaction calculations. Unless otherwise indicated, a $100 monthly heating cost is attributed to the total monthly stress-tested payment. Municipal tax rates are the most recently shown on the applicable municipality’s website (1% used as default when unavailable or for a region with an unspecified mill rate). Mortgage default insurance is not permitted on purchases that have valuations of $1 million or more, amortizations exceeding 25 years, or on refinance transactions.

    Regulatory Titles

    In Ontario (FSRA), mortgage brokers and agents serve as the middle person between borrowers and lenders, helping clients find the most suitable mortgage options for their financing situation. A Mortgage Agent works under the supervision of a Mortgage Broker and assists in the mortgage application process. A Mortgage Broker may also be responsible for compliance requirements for their brokerage or a team.

    The provinces of Quebec (AMF) and Newfoundland (Digital & Government Service NL) both exclusively utilize the designation of Mortgage Broker as a licensing designation.

    British Columbia (BCFSA) has two distinct roles within the mortgage industry: the Submortgage Broker and the Mortgage Broker. These positions have specific responsibilities and functions that contribute to the overall process of securing mortgages for clients. The Submortgage Broker works under the supervision of a licensed Mortgage Broker and assists in various tasks, such as gathering client information, completing paperwork, and liaising with lenders. The Mortgage Broker oversees the entire mortgage application process, including assessing client needs, finding suitable mortgage options, negotiating terms, and ensuring compliance with regulations.

    In Alberta (RECA) and New Brunswick (FCNB), the distinction between a Mortgage Associate and a Mortgage Broker lies in their roles and responsibilities within the mortgage industry. A Mortgage Associate typically works under the supervision of a Mortgage Broker and assists in the mortgage application process gathering necessary documentation, and providing support to clients. A Mortgage Broker is licensed to independently negotiate and arrange mortgage loans on behalf of clients, offering a more comprehensive range of mortgage options and expertise in the field.

    In Saskatchewan (FCAA) and Nova Scotia (Government of Nova Scotia, Business Licensing), there are distinct roles for both Associate Mortgage Brokers and Mortgage Brokers. The critical difference lies in their level of experience and licensing requirements. Associate Mortgage Brokers work under the supervision of a licensed Mortgage Broker and are in the early stages of their career. They may assist with gathering client information and preparing mortgage applications. Mortgage Brokers have obtained the necessary qualifications and licences to operate independently and provide mortgage services directly to clients. They have the authority to negotiate mortgage terms, advise clients, and facilitate the mortgage process from start to finish.

    In Manitoba (MSC), a Salesperson is primarily responsible for promoting and selling products or services, while an Authorised Official holds the authority to make legally binding decisions on behalf of the organization. These roles have different levels of authority and expertise, with the Salesperson focusing on sales and the Authorised Official having broader decision-making powers and acting as the liaison between the brokerage and the regulator. 

    For a complete list of licensing terms in Canada, please see the Mortgage Broker Regulators’ Council of Canada (MBRCC) published list.

    nesto Mortgage Experts

    Titles such as mortgage broker, mortgage agent, submortgage broker, mortgage salesperson, or principal broker are provincially regulated licensing terms with educational requirements specific to each province. Although they may all commonly be referred to as mortgage brokers, in Ontario, where mortgage agents are used as a designation, mortgage brokers or principal brokers have additional responsibility for compliance and training mortgage agents.

    Licensed mortgage professionals often use the industry norm of “mortgage broker,” “broker,” or “advisor” to refer to themselves. However, disclosure requirements for licensed mortgage professionals’ titles vary across each province in Canada. These disclosures require mortgage brokers to adhere to specific rules when using titles to represent their qualifications and expertise. The provinces have regulations and guidelines that govern the use of titles by mortgage brokers. These regulations aim to ensure transparency and protect consumers in the mortgage industry.


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