Canada Housing Market Hits New Lows Sales Drop Amid Economic Uncertainty

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In February 2025, Canadian home sales experienced a significant decline, dropping nearly 10% month-over-month to reach their lowest level since November 2023. This downturn was widespread, with approximately three-quarters of local markets, including major urban centers like Toronto and the Greater Golden Horseshoe region, witnessing substantial decreases. The decline is largely attributed to economic uncertainties stemming from the ongoing trade conflict with the United States, which has eroded buyer confidence and led to hesitancy in making significant financial commitments. ​

This trend is not isolated to February. In January 2025, home sales amounted to 20,931 units, marking a 37.1% decrease compared to January 2024 and representing the lowest January sales since 2009. The national average home price also saw an 18.3% year-over-year decline during this period. Contributing factors include the Bank of Canada's consecutive interest rate hikes since March 2022, which have elevated mortgage rates and deterred both buyers and sellers from participating in the market.

​ Economists anticipate that the housing market will continue to face challenges in the coming months. Elevated interest rates are expected to further suppress demand, while an increase in new listings may lead to a buyers' market, particularly in regions like Ontario and British Columbia. Some forecasts predict that home sales could fall an additional 10% to 15% by the end of the first quarter of 2025, with a potential rebound not expected until early to mid-2026.

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