Update to Our Canadian Residential Real Estate Outlook

Canada’s housing market is correcting quickly, and faster than we anticipated in our downbeat June forecast. Sales and prices are contracting particularly sharply in Ontario and British Columbia. The Maritime provinces are holding up better than expected, while commodity-producing provinces are predictably benefitting from higher global prices. That said, we continue to believe that home prices will generally fall the most over the forecast in provinces that saw the largest gains during the pandemic. At the national level, we expect a roughly 23% decline in the average home price between February 2022 and December 2023. And despite the accelerated pace of decline, we remain of the view that home prices will end 2023 above their pre-pandemic levels nationally and in each province. This is not likely to be the case for sales, however, which have fallen enough that most housing markets have returned to balanced territory.