Canada’s Housing Market Continues to Cool off in July

Home sales across Canada suffered their fourth straight month of declines in July, as the number of individuals looking to sell their property declined significantly, despite ongoing price gains.

According to data published by the Canadian Real Estate Association (CREA), home sales fell another 3.5% in July, as the total number of transactions were 15.2% lower compared to year-ago levels. Similarly, the number of newly listed homes also declined in July, falling by 8.8% month-over-month, and down 15.2% from July 2020.

“The slowdown we’ve seen in home sales over the last few months has not been surprising, given that the level of activity we were seeing back in March was unsustainable,” explained CREA senior economist Shaun Cathcart. “But we are not returning to normal, we are only returning to where we were before COVID, which was a far cry from normal. The problem of high housing demand amid low supply has not gone anywhere – it’s arguably worse.”

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the sales-to-new listings ratio also tightened in July, despite a noticeable slowdown in transaction activity. The ratio rose from 69.9% in in June to 74%; comparatively, though, the long-term average stands at 54.7%. In another sign that the housing market is headed towards a normalization, the number of months of inventory remained unchanged at 2.3 months between June and July.

Despite the decline in transaction activity, housing prices still remained elevated in July. The national average home price was still up 25.9% from July 2020, and stood at $679,000. Likewise, the MLS Home Price Index rose 22.2% year-over-year, but receded from the record 24.4% increase noted the month prior.


Information for this briefing was found via the CREA. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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