In July 2025, the Canadian housing market experienced a notable acceleration in price declines even as home sales increased. This phenomenon reflects a surge in new listings, which has outpaced demand and increased inventory, creating downward pressure on prices.
- Key Market Metrics
Metric Value Insight
Composite Benchmark Price $693,300 Largest monthly drop since Oct 2024; 18.6% below March 2022 peak
Monthly Price Change −0.7% (−$4,700) Prices continue to trend downward
Year-over-Year Price Change −3.4% (−$24,500) Slight improvement over June, but still declining
Sales Volume 47,045 homes +6.6% YoY, highest July sales since 2021
New Listings 88,616 +5.9% YoY; record volume for July
Sales-to-New Listings Ratio 51.9% Near 50%; indicates a balanced market
- Market Dynamics
Rising Sales: The 6.6% YoY increase in sales indicates growing buyer activity, signaling interest in the market despite falling prices.
Inventory Surge: A record number of new listings demonstrates that more sellers are entering the market, likely anticipating continued price pressure.
Accelerating Price Declines: Benchmark prices fell by 0.7% month-over-month, driven by increased supply outpacing demand.
- Regional Highlights
Greater Toronto Area (GTA): Benchmark price fell 1.4% to $981,000, down 5.4% YoY.
Condominium Market: Prices for condos dropped 0.8% to $490,600, the lowest level since June 2021.
Other Markets: Similar trends of falling prices and rising inventory observed nationwide, though severity varies by region.
- Implications
For Buyers
Opportunities exist in markets with higher inventory and softer prices.
Buyers should act cautiously, considering potential further declines.
For Sellers
Competitive pricing strategies are required to attract buyers in markets with increasing supply.
Market timing is critical as price pressure may continue.
For Investors
Rising inventory and falling prices may create short-term risks.
Long-term investment viability should focus on strong-demand regions.
- Outlook
The Canadian housing market is balancing supply and demand, with sales rising but inventory increasing faster than demand.
Prices may continue to decline modestly if the inventory surge persists.
Monitoring regional variations will be crucial for market participants to make informed decisions.
