The quietness of the 2025 fall real estate market has continued into November. While prices are a bit of a mixed bag relative to October, they are down moderately in every segment compared to last year.
Robust inventory levels and lower sales volumes continue to put downward pressure on prices, which has been especially the case for the past several months.
In fact we are at multiyear highs for listings and multiyear lows for sales volumes. And with buyers now clearly in the driver’s seat, days on market is also trending higher, with a typical property in every category taking over a month to sell.
This is not a local phenomenon. Calgary and Toronto are seeing similar market conditions. I suspect that part of the decline we are seeing is investor driven, especially in the apt condo and townhouse segments. Rents here and in many places across Canada are lower relative to both last year’s and the 2023 figures. It is difficult to make a case for real estate investment in the short term. Compare this to the TSX, up by 25% compared to January.
Going forward into the new year, we are faced with under performing housing targets and high immigration levels even after Ottawa’s cuts. As of September, Ontario met just 26% of its target. Immigration is expected to come in nationally at 3/4 of a million people in 2026, and many of them will chose to live in Ontario.
With low rates, low supply and lots of potential buyers, there’s a compelling argument for a turn around in the real estate market. But when that will occur is certainly hard to predict. The Bank of Canada has predicted sluggish growth next year at the last meeting. And at the moment it’s obvious that buyers are reluctant and that’s not surprising with all the turmoil south of the border. I think we’ll see more of the same slowness in December and into January.
