RE/MAX® has been voted the #1 Most Trusted Real Estate Agents in Canada by Canadian shoppers, year after year*, according to the 2024 BrandSpark® Canadian Trust Study.

The study is based on a national survey of 25,161 Canadian shoppers who gave their top-of-mind, unaided feedback on which brands they trust most and why, in the categories, they have recently shopped. Market research and consulting firm BrandSpark International analyzed 262 different categories of consumer products and services, spanning Household & Cleaning, Petcare, Home Goods, Food & Beverage, Beauty & Personal Care, Over-The-Counter Health, Baby & Kids, Automotive, Restaurants & Retail and Services.

As part of the Services category, RE/MAX was named the #1 most trusted real estate agency brand*.

The BrandSpark Canadian Trust Study reveals that, despite the challenges posed by inflation, consumers prioritize product quality and are willing to pay a premium for brands that consistently deliver excellence. Brand names continue to dominate the list, demonstrating that established brands continue to deliver value to Canadians.

“New challengers are appearing in many categories, often online and at much lower price points, but the best brands are proving resilient with Canadian consumers when they focus on delivering and communicating the strengths that made them trusted names in the first place,” said BrandSpark Vice-President of Shopper Insights Phil Scrutton in a press release.

Rising lending rates have had a notable impact on the housing sector, prompting potential buyers to search for more affordable housing options. Simultaneously, some potential sellers have refrained from listing their homes to avoid the consequences of higher rates. The decrease in new listings at lower price points has likely hindered overall sales activity, particularly as lower-priced properties contributed to declines in sales during 2023. Despite a moderation from record-high levels, strong migration growth and a robust labour market have kept sales well above long-term trends. 

While international migration has influenced rental markets, resulting in increased rental gains and heightened demand from investors, interprovincial migration from higher-priced markets in British Columbia and Ontario has helped support sales growth in the higher price ranges of our market, even in the face of higher lending rates. Moving into 2024, we anticipate that potential buyers who were previously on the sidelines due to limited supply choices may reenter the market as lending rates ease and listings improve. 

Looking ahead to 2024, migration is expected to slow, but remain robust enough to sustain relatively strong sales in our market.

At the same time, with more mortgages set to renew, we could see some gains in resale listings as existing homeowners who were previously hesitant to change their housing situation may be motivated to capitalize on rising prices and favourable seller market conditions. The combination of improved listings and heightened activity in the new home sector is anticipated to foster some growth in overall supply. However, given the persistent strong demand driven by recent migration and a healthy job market, it will take time for supply levels to rise sufficiently to restore balance to the market. 

Although conditions are not expected to be as tight as in 2023, a seller’s market is projected to persist throughout the spring market, resulting in further price growth. However, the rate of growth for each property type is anticipated to slow compared to 2023 levels. Supply growth is expected to be mostly driven by the upper price ranges for each property type, which will likely decelerate the pace of price growth for higher-priced properties. Meanwhile, conditions are expected to remain tight for lower-priced properties, contributing to continued price gains.

Courtesy Calgary Real Estate Board.

Click here for the full CREB^® 2024 Forecast Calgary and Region Yearly Outlook Report.

The Canadian real estate market is going through an adjustment period right now. After a couple of years of meteoric growth across the entire housing sector, conditions seem to be settling, the frenzy has come to an end, and Canadian housing markets from coast to coast are regaining equilibrium.

According to the 2024 RE/MAX Canadian Housing Market Outlook, the national average residential price is expected to rise only slightly this year, by 0.5 percent. Meanwhile, 61 percent of markets surveyed in the report are expected to see unit sales increase year over year. This is a complete retreat from the challenging market conditions experienced in early 2022.

So, what is happening exactly? First, the Bank of Canada (BoC) has been raising interest rates, a tightening cycle that has lifted mortgage rates. Second, there has been a great deal of uncertainty in the housing market and the broader economy. Third, many households have exhausted their pandemic-era savings, and inflation has diminished their purchasing power.

Ultimately, the Canadian real estate market is slipping into balanced territory because of the latest developments nationwide. RE/MAX’s outlook for the Canadian housing market suggests 41 percent of regions will return to balance, while 28 percent of markets will likely favour sellers, 21 percent tilted toward buyers, and four percent will experience mixed conditions.

“It’s been a challenging year for Canadian homebuyers and sellers, who have been feeling the effects of a severe housing shortage and the high cost of living, but much like Canada’s housing market, Canadians have stayed resilient. Historically, real estate has given owners excellent returns and strong financial security – and that hasn’t changed,” said Christopher Alexander, President of RE/MAX Canada. “The slower market we experienced across the country in the fall could be an early indicator of an active 2024, as reflected in the modest price increase and sales outlook in 2024, and the balancing of conditions in several regions across the country.”

But while this talk of balancing conditions and steadying prices is good news for prospective homebuyers, what about sellers? Is this type of environment beneficial for those looking to list their home this year?

Why Current Conditions in the Canadian Real Estate Market Could Be Good News for Sellers

So, what exactly is a balanced or buyer’s market anyway?

A balanced market is when the supply of residential properties meets the level of demand. A buyer’s market is when there is a greater inventory of homes than the number of buyers.

Now, it is crucial to understand how these types of climates work:

Buyers will possess more leverage and may be able to negotiate prices. (Much different from years past!)

Your home may sit unsold on the market for longer than you anticipated.

You might need to lower your expectations from your initial asking price.

With prices expected to ease in 2024 and conditions tilting in favour of buyers, where is the good news for sellers?

First, the +0.5-per-cent outlook is a national average, and may be higher or lower depending on where you are located. For example, if you are selling your home in the Edmonton real estate market, the sale price is expected to rise four percent in 2024. Meanwhile, if you are listing your home for sale in the Windsor housing market, average price is expected to rise seven percent this year.

Second, if you are selling your home, you will also need another place to hang your hat once the transaction is completed. Therefore, if you take the equity and purchase another residence, you will not have to endure the frenzy and panic of a seller’s market.

Finally, a balanced market does not mean you will need to give away your home for a 20 percent discount. But you might need to employ a few additional measures to attract buyers. Here are several suggestions:

• Always work with a real estate agent.

• Be sure that your home is in tip-top shape and have your home inspected before a For Sale sign is erected on your front lawn.

• Make your front and backyard presentable; enhance your home’s curb appeal.

• Ensure that you clean your house of clutter.

• Add a couple of incentives, such as new appliances.

Remember, there is still demand for housing. With the Bank of Canada expected to start decreasing interest rates this year, home buying is likely to pick up again, especially as immigration levels rise. Put simply, the competition in the Canadian real estate market will likely be revived.

“Canadians have been understandably hesitant to engage in the market in 2023. Despite this, Canadians still see real estate as a solid long-term investment,” said Alexander.

Courtesy RE/MAX Canada

DECEMBER 2023 HOUSING MARKET UPDATE

January 2, 2024

Strong migration and low supply drive Calgary housing prices in 2023

Sales in 2023 did ease relative to last year's peak, but with 27,416 sales, levels were still far higher than long-term trends and activity reported before the pandemic. While sales stayed relatively strong, there was a notable shift in activity toward more affordable apartment condominiums style homes.

“Higher lending rates dampened housing demand this year, but thanks to strong migration levels, housing demand remained relatively strong, especially for affordable options in our market,” said CREB® Chief Economist Ann-Marie Lurie. “At the same time, supply levels were low compared to the demand throughout the year, resulting in stronger than expected price growth.”

Inventory levels were persistently below long-term trends for the city throughout most of the year, averaging a 44 per cent decline over the 10-year average. We also saw the months of supply remain well below two months throughout most of the year across homes priced below $1,000,000.

The persistently tight conditions contributed to our city's new record high price. While the average annual benchmark price growth did slow from 12 per cent in 2022 to nearly six per cent growth in 2023, the price growth was still relatively strong especially compared to some markets in the country.

Detached

With an annual decline of nearly 20 per cent, the detached market saw the most significant decline in sales activity. While sales did improve for homes priced above $700,000, limited supply choices in the lower price ranges caused consumers to turn to alternative housing styles. Despite some recent gains in higher-priced new listings, inventories have remained near record lows, and the months of supply have remained relatively low throughout 2023.

The persistently tight market conditions have supported further price growth for detached homes, albeit at a slower pace than last year. On average, the benchmark price rose by nearly eight per cent in 2023, with the most significant gains occurring in the city's most affordable districts.

Semi-Detached

Like the detached sector, year-over-year sales growth since May was not enough to offset the pullbacks at the beginning of the year, leaving 2023 sales down by 10 per cent. The decline in sales was driven by pullbacks for homes priced under $500,000, while sales improved for higher-priced properties. The decline in the lower range was primarily due to limited supply choices, preventing stronger sales.

Persistently tight market conditions this year caused prices to trend up throughout most of the year. On an annual basis, the benchmark price rose by seven per cent over last year—a slower gain than the 12 per cent reported in 2022, but still relatively strong. Price growth ranged from a low of six per cent in the city centre to over 16 per cent in the east district.

Row

Limited supply choices in the lower price ranges contributed to the pullback in sales in 2023. Annual sales declined by over 11 per cent despite rising sales for homes priced above $400,000. While new listings did show signs of improving in the second half of the year, all of the gains were reported in the higher price ranges, causing relatively more balanced conditions in the upper price ranges versus the sellers’ market conditions in the lower price ranges.

Conditions favoured the seller throughout the year, supporting an annual benchmark price gain of over 13 per cent. Prices improved across each district, ranging from a low of 11 per cent in the city centre to over 20 per cent price growth in both the North East and East districts.

Apartment Condominium

Apartment-style properties were the only property type to report a gain in sales this year, resulting in a record high of 7,884. The growth in sales was possible thanks to the higher starting point for inventory levels and gains in new listings. However, conditions tightened throughout the year, favouring the seller and driving price growth.

Apartment condominium prices finally recovered from their 2014 high earlier this year and have pushed above those levels, reaching a new record high of $321,400 by December. On an annual basis, the 2023 benchmark price rose by over 13 per cent, a faster pace than the annual growth levels reported last year.  

REGIONAL MARKET FACTS

Airdrie

Primarily due to pullbacks for detached homes, sales in Airdrie declined by 24 per cent over last year's record high. Low inventory levels and a pullback in new listings have somewhat limited sales. While new listings have risen over last year's levels for the past four months, they are still 24 per cent lower than last year. The decline in sales and new listings ensured inventories remained low this year, declining over last year’s and falling to the lowest annual average levels seen since 2006.

For the third year in a row, conditions in Airdrie have generally favoured the seller. This has driven further price gains this year, albeit at a slower pace. On an annual basis, the benchmark price rose by nearly five per cent. This year, the price growth for row and apartment-style properties has been more than double that reported in the detached and semi-detached sectors.

Cochrane

Both sales and new listings in Cochrane fell over last year’s levels. However, recent gains in new listings relative to sales did help support some inventory gains. While inventory levels have improved over the low levels reported last year, they remain over 40 per cent below what we traditionally see in the market.

The recent shifts in new listings relative to sales have helped the months of supply stay above two months since September. However, conditions are still relatively tight, and prices continue to rise. While the growth was stronger in the higher-density sectors of the market, the detached benchmark prices increased by four per cent in 2023 over last year.

Okotoks

Supply has been a challenge in Okotoks, impacting sales and prices. While we have seen some improvements lately regarding the level of new listings compared to sales, inventories have remained near record lows and averaged 63 per cent below long-term trends on an annual basis.

Conditions have remained relatively tight throughout most of the year, especially throughout the busier spring season. Despite some monthly variation, prices generally trended up this year and, on an annual basis, rose by over six per cent.

Click here to view the full City of Calgary monthly stats package.

Click here to view the full Calgary region monthly stats package.

Lawmakers across Canada have put a renewed focus on making housing more affordable, but experts predict chronic issues around pricing and supply will keep straining the country’s rental market in 2024.

“I don't see things getting better in the short term,” Steve Pomeroy, senior research fellow for the Centre for Urban Research and Education at Carleton University, told BNNBloomberg.ca in an interview.

Pomeroy expects a recent uptick in rental construction will partially alleviate the supply shortage in Canada, but he said it will take some time for renters to see meaningful relief.

“We've actually significantly increased our game in terms of adding new rental supply,” Pomeroy said, noting that the pace of rental construction has picked up in Canada in recent years.

“But it's a lag issue,” he continued. “It's going to take a bunch of years … to catch up, and if we don't suppress demand in the short term, we're going to continue to have short-term pressures.”

‘A SLOWER YEAR FOR RENT INCREASES’

Shaun Hildebrand, president of real estate consulting firm Urbanation, told BNNBloomberg.ca that rent prices in Canada will likely remain elevated next year, but he expects price growth to be slower.

“It'll be a slower year for rent increases, particularly in the more expensive markets,” he said in an interview.

Urbanation’s latest monthly rent report found that the average asking price for a rental unit in Canada was $2,174 in November, relatively flat from the previous month but an 8.4 per cent increase year-over-year.

It also found the annual rate of rent growth in Canada has been slowing, following year-over-year increases of 9.9 per cent in October and 11.1 per cent in September.

Hildebrand noted that average rent prices in Toronto and Vancouver decreased towards the end of 2023, due in part to seasonal demand changes, as rent prices tend to decline in the late fall and winter.

Renters may still take advantage of the cooling trend in the early months of 2024, he said.

“If you are a renter that's looking for a unit in Toronto or perhaps Vancouver, the next few months would be quite favorable to do so, but the structural supply deficit in these markets is still very acute,” he said.

A decline in inflation in 2024 and potential interest rate cuts could take some pressure off rent prices in 2024 as first-time homebuyers move into the ownership market, Hildebrand said. However, he cautioned that home prices will likely remain prohibitive for many Canadians. 

Despite the ongoing challenges faced by Canadian renters, Hildebrand said he expects the record price growth seen in the rental market to “move into the mid-to-lower single digits” at the outset of 2024.

GST REMOVAL

The federal government announced in September that it would waive GST on new rental projects in an effort to encourage new developments.

Ontario, the province with the most renters in the country, followed suit in November, announcing the removal of their portion of the HST on new rental builds.

Developers have welcomed the changes but highlighted more work that must be done to add supply to the market.

Giacomo Ladas with rentals site rentals.ca said the tax measures have made rental construction more economically viable for developers, though many challenges remain.

“It’s a really good first step, but there are still so many hurdles that I've talked to developers about that slow down the construction of these new apartments,” Ladas told BNNBloomberg.ca in a phone interview.

“It could take six or eight months, I was told by some developers, to negotiate what colour to paint the facade of their building … there's so many hurdles for them to actually get something built.”

POPULATION GROWTH

Pomeroy and other experts have made the case that record immigration numbers have contributed to the post-pandemic rental supply shortage that has driven up rent prices in turn.

Canada has seen significant increases in its non-permanent resident population, many of them temporary foreign workers and international students.

“Those are the folks who rent,” Pomeroy said.

“The immigration policy or the lack of management of immigration, particularly temporary immigration, I think was the key driver in excess demand. It's not so much that we had a chronic problem of under supply, we had an instant issue of surging excess demand.”

The federal government has tabled plans to level out the number of new permanent residents to Canada in 2026, and doubled the income requirement for foreign students who wish to study in Canada.

But Pomeroy said that in 2024, he doesn’t see those measures “massively ratcheting back” the number of international students or foreign workers coming to Canada.

“In the absence of very aggressive action on reducing that number, then that pressure is not going to go away,” he said.

Courtesy BNN Bloomberg with files from the Canadian Press.