Desjardins Housing Outlook: Economic Downturn, Delayed Rate Hike Effects Set Up Slow Spring Real Estate Season

We now think that most major markets will experience softer sales and prices through the spring months, as weakness has spread significantly since the Bank of Canada resumed hiking interest rates in June. The economic downturn that we expect to materialize as 2024 approaches should also put downward pressure on sales and prices.

Large cities in Ontario and BC have been hit the hardest and face challenging near-term prospects given the economic weakness we forecast in those provinces.

Still, we expect 2024 to bring only a mild recession by historical standards. As the Bank cuts rates and an economic recovery takes shape later next year, we should see sales and prices pick up.

We think homebuilding will moderate significantly next year against a backdrop of still-high rates, elevated input costs and construction sector labour shortages.