Looking into the crystal ball of real estate is a perilous pastime. Any experienced agent will tell you it’s more important to transact when you are ready, rather than try to buy and sell a home like you would offload shares.
By the time you’ve picked up on a new market trend, it’s usually too late to respond by selling your home over a four- or six-week period.
The market doesn’t move in mysterious ways, but it can change its mood quickly.
Just ask the peak industry body, the Canadian Real Estate Association (CREA). It has had to revise its predictions for the 2025 market in the aftermath of tariffs and general economic threats from the US.
Canadians have reacted with anger politically and caution financially.
Sales dipped 4.8% in March compared with February, and that trend continued into April.
Almost overnight, the momentum has swung from an increasingly balanced market, following the post-Covid spike in values, to one that favours the buyer.
The “sales-to-new-listings” ratio has fallen to 45.9% – anything below 45% is regarded as a buyer’s market.
Due to a combination of strong listing trends and lower sales, the CREA now says 50,000 fewer homes will be sold this year than it had originally forecast. The volume of deals will remain aligned to the 2024 result with some 482,673 residential properties likely to be sold.
The change in the supply dynamics will push prices south 0.3% to an average $687,898, which is $30,000 less than the CREA originally forecast.
“It’s been a very big change in a very small amount of time,” CREA’s senior economist Shaun Cathcart was quoted as saying.
There are pockets where values have remained resilient despite the economic narrative, including most of the Prairies, Quebec and the East Coast.
The CREA has forecast 2025 gains for Newfoundland and Labrador, Quebec and Prince Edward Island. A decrease in transactions is expected for Ontario and British Columbia.
If you are a first-time buyer or upsizer, the downward pressure on prices may work out for you. Here are some market traits you may begin to see:
Position of power – If you are an upsizer, you should ensure a five-star presentation of your own home to maximise its value and minimise your time on market. Finding a buyer for your home quickly will put you in a strong position to purchase your next dream home.
More negotiating power – This is your most significant advantage. Sellers are often more willing to negotiate on price or provide attractive concessions.
More Choice – An increase in the number of homes for sale obviously means more choice. And in all likelihood, you’ll have more time to make your decision and not encounter a bidding war.
Extended time on market – Properties on the market for more than three to four weeks will give buyers time to conduct thorough due diligence, including more detailed inspections and appraisals, without the fear of losing to another offer.
Bargain hunting – Fixer-uppers rarely find their desired price-point in a buyer’s market. So you may uncover a number of great buying opportunities if you’re ready to undertake repair work.