What lies ahead for Canadian Real Estate in 2024?

The Canadian Real Estate Association (CREA) released its housing market statistics for the final month of 2023 last week, closing out a year that can be defined as, if anything, “unpredictable.”

According to CREA’s December report, 2023 ended with a jump in sales and a year-over-year decline in listings and prices.

Governments must take action

This glimmering of hope may be interpreted by some as a sign of increased market activity, but in reality, Canadians are still experiencing a housing crisis rooted in severe affordability and inventory challenges across the country. This crisis will continue to persist throughout this year.

With high demand (which is expected to continue to grow as immigration rises), and low inventory, there’s a dire need for governments at all levels to collaboratively enact new measures and policies that make the market more affordable and accessible for all.

According to Leger research commissioned recently by Re/Max Canada most Canadians (73%) consider home ownership as their best investment. Governments should support this aspiration.

2024 Trends

Reflecting on the past year and looking ahead to what’s on the horizon for 2024, here are some of the trends that are likely to play the biggest roles in the Canadian real estate market.

The stats: A deeper dive on home sales & outlook for 2024

In line with Re/Max’s housing price outlook for 2024, the market is likely to be active in the first quarter and into the spring — a trend that is already starting to materialize. Interest rates, a high demand for housing and a low inventory will continue influencing the market in 2019.

The interest rate effect

Canadians have faced some of their highest interest rates in decades over the past year. This, combined with a lack of housing stock, led to a softening of the market in the second half of 2023.

As we look ahead, with another possible pause or even a slight decline in interest rates on the horizon, interest rates will likely be a prominent influence on market activity — especially considering that many Canadians have taken a “wait and see” approach when it comes to their housing ambitions. 

National Insights

Re/Max agents and brokers in key regions across the country provided their market insights. Here’s how these influencing factors are expected to play out regionally in 2024: 

The following are some of the ways to get in touch with us Western CanadaVancouver, Nanaimo, Saskatoon, and Edmonton, which are growing and major cities, expect a rise between 2 to 4 percent in residential prices. Victoria and Regina expect a slight drop of 2 per cent. 

Ontario’sThe most populous markets will see increases between 2 and 7.5 per cent. Smaller markets that grew rapidly during the pandemic are likely to see a decline from up to five per cent.

The following are some of the ways to get in touch with us MontrealPrices will likely remain stable, but interest rates may encourage more homeowners list their properties. 

Atlantic Canada, once a haven for Canadians seeking affordability, is anticipating modest increases across the board of around 3 per cent in the region’s largest and growing markets.

Acknowledging and addressing Canada’s housing shortage: A must

The Canadian housing industry has historically provided homeowners with solid financial security as well as great returns. We believe in the long-term health of Canada’s housing market but, to protect it, we need to acknowledge and address the housing supply shortage in every city, town and neighbourhood across the country.

I hope that we can achieve this goal by 2024. I encourage visionary thinking and solutions that may include reforming municipal zoning laws to allow for a greater diversity of housing, expanding capacity for laneway developments and using available land to drive housing supply in a manner that doesn’t compromise climate adaptation and mitigation efforts. In order to achieve this, some difficult decisions must be made.

Over 65% Canadians agree

Re/Max Canada’s research in 2023 revealed that Canadians strongly believed that the affordability and housing crisis should be a top priority for governments across Canada (66%) Additionally, 41 per cent feel that removing zoning and development red tape is a key measure toward improving supply — something they hope will continue.

So, let’s keep our eyes on the prize this year.