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In the first week of September, the Bank of Canada announced its third interest rate cut of the year, creating ripples across the Canadian housing market. From price drops in British Columbia’s high-demand regions to significant growth in the Prairies, the market revealed various challenges and opportunities for buyers and sellers alike.
B.C.’s Balancing Act, Prairie Prices Surge
For instance, British Columbia, known for its steep housing prices, experienced mixed outcomes. In Fraser Valley, home prices increased by 0.6%, bringing the average to $1,036,581. Vancouver saw a 3.5% dip, with prices now at $1,258,450. However, Victoria saw an even greater price drop, posting a 4.5% decrease that lowered the average price to $960,198.
In the Prairies, the housing market remained resilient, with steady price growth across Alberta, Saskatchewan, and Manitoba. Calgary home prices rose by a whopping 14.0% to $631,527, while Edmonton also recorded a substantial 12.4% increase, bringing the average to $428,959. Saskatchewan cities led the charge in growth, with Regina seeing a 13.2% surge to $354,336 and Saskatoon with a 16.5% rise to $396,993. Winnipeg also enjoyed modest gains, with prices increasing by 3.2% to $382,513, further supporting the region’s reputation for affordability and steady demand.
Gains and Declines in Canada’s Most Populated Provinces
Ontario, Canada’s largest real estate market, displayed a patchwork of results across its regions. Hamilton–Burlington saw one of the province’s largest price increases, up by 6.3%, bringing prices to $901,231. Kitchener–Waterloo experienced strong momentum with a 3.3% rise, pushing prices to $805,299, while London and St. Thomas posted a 2.4% gain, reaching $644,796. However, not all markets fared well—Thunder Bay experienced the sharpest decline in the province, with prices dropping 10.3% to $326,068. In contrast, Northern Ontario’s Sudbury saw the highest increase, with prices jumping 10.7% to $497,681. Meanwhile, Canada’s capital city, Ottawa recorded a more modest rise of 1.6%, bringing average prices to $670,881.
Quebec’s housing market showed robust growth across several regions. Montreal’s CMA recorded a 6.0% rise, with average home prices reaching $658,861. Quebec City, known for its affordability, posted a notable 13.1% increase, raising the average cost to $424,279. Quebec’s diverse economy and growing demand have likely contributed to these impressive gains.
Atlantic Canada’s Resilient Housing Market
Atlantic Canada continued to see significant home price growth. Halifax–Dartmouth saw a major 10.8% increase, bringing the average home price to $575,075, while Saint John, New Brunswick, experienced an impressive 18.6% increase, rising to $351,604. Newfoundland and Labrador faced a 5.1% increase, with home prices now averaging $318,329. While price changes were substantial, the region offers some of Canada’s most affordable housing.
National Overview: Steady Growth with Increased Listings
On a national level, home prices rose year-over-year by 2.1% in September 2024, bringing the average cost to $669,630. Sales activity increased by 6.9% year-over-year, while new listings grew by 7.6%, indicating that more sellers are entering the market. Key markets like Toronto saw a 44.2% rise in new listings from 12,547 in August to 18,089 in September, while Victoria recorded a similarly impressive increase, up 42.2% to 1,331. In Ontario, Hamilton-Burlington had one of the highest growths in listings at 34.8%, from 1,574 in August to 2,121 in September. The increase in supply is helping to alleviate upward pressure on prices, especially in high-demand markets.
Market Balance: Easing into Stability
Canada’s housing market showed signs of balance in September, with the national sales-to-new listings ratio easing to 51.3%. Interest rate cuts have driven steady sales growth, though not headline-grabbing, as Shaun Cathcart, CREA’s Senior Economist, noted: “Sales gains are now three for three in the months following interest rate cuts.” However, with the pace of rate cuts expected to accelerate, some buyers may delay purchases, anticipating better mortgage conditions. As Cathcart explains, this could boost the anticipated market rebound in 2025, potentially slowing activity for the remainder of 2024.
Canada’s Affordable Regions and Growth Hotspots
As of September 2024, approximately 76.9% of regions in Canada had home prices below the national non-seasonally adjusted average of $686,067, and 38.5% of areas had prices under $500,000. These more affordable markets are primarily concentrated in the Prairies, Quebec, and Atlantic provinces, where housing costs remain significantly lower than the national average. The most affordable regions were Saguenay CMA, with an average home price of $318,662, followed closely by Newfoundland & Labrador at $318,329 and Thunder Bay at $326,608.
Meanwhile, regions with the highest percentage price increases included Trois-Rivières CMA, which saw a 12.7% rise, with prices climbing from $338,962 to $381,877. Sherbrooke CMA experienced an 8.1% increase, reaching $507,917, while Sudbury saw a 7.5% increase, with prices rising to $494,695. These regions demonstrated notable growth, contrasting Canada’s generally more price-friendly areas.
The rise in new listings is helping to ease supply pressures in several key markets. Still, regional dynamics continue to shape the market’s future.“The beginning of September saw a burst of new supply for buyers to choose from before things generally quiet down for the winter,” said James Mabey, CREA Chair. “While some buyers may choose to take advantage, others may be inclined to wait as the bulk of future rate cuts from the Bank of Canada are now expected to show up in a matter of months as opposed to years.”
With winter on the horizon, economic conditions and interest rate movements will remain critical factors in determining the direction of Canada’s housing market.
Market conditions vary from region to region, so if you’re considering buying or selling, you must speak with a local real estate agent to learn about conditions in your area. Call us today if you’re ready to discuss your real estate goals!
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