Canadian Real Estate Market Shows Signs of Stabilizing
After months of sharp declines, Canada’s housing market appears to be entering a “transition period,” according to the latest data from the Canadian Real Estate Association (CREA). While home sales in April dropped 9.8% compared to last year, seasonally-adjusted figures reveal sales have essentially leveled off since March.
Sales Pause After Steep Declines Amid Trade Uncertainty
Senior economist Shaun Cathcart explains that sales had plummeted nearly 20% from November to March, largely influenced by the onset of trade tariffs in January. However, April’s numbers show a pause in this downward trend, suggesting the market may be finding its footing despite ongoing economic uncertainty.
Prices Dip but Sellers Still Negotiating
The MLS Home Price Index fell 1.2% in April, with average listing prices down 3.6% year-over-year and actual sale prices dropping 3.9%. Cathcart notes sellers are adjusting expectations but prices are not collapsing. “It’s still a negotiation,” he says, “with buyers and sellers reaching mutually agreed outcomes.”
Market Uncertainty Lingers Amid Trade and Interest Rate Concerns
Many buyers and sellers remain cautious, waiting to see how trade tensions and Bank of Canada interest rate decisions will impact mortgage rates and the broader economy. CREA’s data hints the market may have weathered the worst of the trade war’s effects-for now.
The Risk Ahead: Potential Layoffs Could Shake the Market
Cathcart warns that the biggest threat lies ahead if economic damage leads to widespread layoffs. “If people are forced to sell quickly, we could see distressed sales and price drops,” he says. “We’re not there yet, but that risk remains.”
Insight:
Canada’s real estate market is navigating a delicate balance between uncertainty and stabilization. While April’s data offers cautious optimism, buyers and sellers alike remain watchful as economic pressures continue to unfold.
