Canadian Existing-Home Sales Decline Just as New Listings Surge in January

On Tuesday, the Canadian Real Estate Association (CREA) reported that existing-home sales activity recorded over Canadian MLS® Systems was down 3.3% in January.

Most of the decline occurred in the final week of the month when the potential trade war with US became a major purchasing headwind, CREA said.

The number of newly listed homes increased 11% month-over-month. Aside from some of the wild swings seen during the pandemic, this was the largest seasonally adjusted monthly increase in new supply on record going back to the late 1980s.

With sales down amid a surge in new supply, the national sales-to-new listings ratio fell to 49.3% compared to readings in the mid-to-high 50s in Q4. The long-term average for the national sales-to-new listings ratio is 55%, with readings between 45% and 65% generally consistent with balanced housing market conditions.

There were close to 136,000 properties listed for sale on all Canadian MLS® Systems at the end of January, up 12.7% from a year earlier but still below the long-term average of around 160,000 for that time year.

There were 4.2 months of inventory on a national basis at the end of January, up from readings in the high threes in October, November, and December. The long-term average is five months of inventory. 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 6.5 months, according to CREA.

The non-seasonally adjusted national average home price was $670,064 in January, up 1.1% from January 2024.