Canadian Housing Shows Early Recovery Signs, but Risks Cloud the Outlook
Canada’s housing market is showing early signs of recovery, with home resales rising since April, inventory levelling off and prices beginning to stabilize. Improved affordability and job prospects could draw sidelined buyers back, but progress is expected to vary across the country. Ontario and British Columbia face lingering effects from prolonged corrections, while Toronto and Vancouver condominium markets may remain weak into next year because of high inventory and limited investor interest.
RBC expects home resales to decline 3.6% to 453,200 units this year and the benchmark price index to fall 2.3% to $794,200. A clearer recovery is projected for next year, with sales increasing 6.7% to 483,600 and benchmark values rising 0.8% to $800,700, though the market would remain soft. Interest rates are expected to hold through year-end before rising next year, while trade tensions and conflict in the Middle East could undermine confidence and derail the recovery.
