CREA Dials Back 2025 Housing Forecast: Canadian Home Sales Likely to Fall Short of 500,000 Again

Even though home sales picked up for the second straight month in June, the Canadian Real Estate Association (CREA) is now forecasting a 3% drop in sales for the year compared to 2024.

The latest housing data shows the number of Canadian home sales rose 2.8% on a month-over-month basis in June, led by the Greater Toronto Area’s resurgence that has seen home sales climb 17.4% cumulatively since April.

“At the overall national level, June was kind of a carbon copy of May in a lot of ways,” said CREA’s Senior Economist Shaun Cathcart in the latest CREA Housing Market Report (watch below), “which is good, because it means sales were up again and prices held steady again, as opposed to falling.”

Cathcart said it’s “another month of evidence” to play into a turning of tides when it comes to Canada’s real estate landscape, which was previously seeing declines in sales and prices, while new listings were increasing. That wasn’t the case in June.

Before we get into more of the data, here’s what you need to know at a glance:

• National home sales were up 2.8% month-over-month.
• The number of newly listed properties fell 2.9% on a month-over-month basis, although inventory had been steadily climbing prior to June.
• The actual (not seasonally adjusted) national average sale price was down 1.3% on a year-over-year basis.
• CREA has revised its forecast to project a 3% year-over-year decline in home sales
• CREA is forecasting a 1.7% drop in the national average price compared to 2024.

Is this a good time for buyers?

Cathcart mentions how prices have stabilized after their recent correction. With more listings on the market, this typically helps tip the scales into a buyer’s favour, but there are other factors currently at play which may make an entry into homeownership more enticing.

Interest rates are trending downward as the Bank of Canada’s policy rate has been cut from 5% in April 2024 to 2.75% today. Experts are not forecasting another cut at the end of the month and have revised their expectations lower for a single cut by the end of the year. (The next interest rate announcement from the Bank of Canada is scheduled for July 30).

With inventory up 11.4% overall compared to last year, those who have job security and want to lock down a home for the long term could be finding a lot of value on their home hunt. For instance, take a look at Toronto’s condo market. The Toronto Regional Real Estate Board reports condominium apartment sales in the first quarter of 2025 amounted to 3,794 in the Greater Toronto Area, down 21.7% compared to 2024. And according to an Urbanation Inc. study published in the Financial Post, sales of new condominium apartments in Toronto are sliding to lows not seen in three decades.

Of course, a new tariff policy has recently been announced on Canada by U.S. President Donald Trump, but the effects of that are yet to be known.

“Most housing markets continued to turn a corner in June, although market conditions still vary considerably depending on where you are in Canada,” said Valérie Paquin, Chair of CREA’s 2025-2026 Board of Directors and a REALTOR® based out of Blainville, Quebec. “If the spring market was mostly held back by economic uncertainty, barring any further big shocks, that delayed activity could very likely surface this summer and into the fall. If you’re looking to buy or sell a property in the second half of 2025, start planning with a REALTOR® in your area today.”

What trends are emerging in Canadian real estate?

CREA revised its 2025 forecast to reflect the tariff chaos and uncertainty that drove buyers back to the sidelines.

First, let’s look at prices.

The national average home price is forecast to edge back by 1.7% on an annual basis to $677,368 in 2025, which is about $10,000 lower than was forecast back in mid-April. Only British Columbia and Ontario are forecast to see declines in the average home price this year, but the combination of those declines, along with fewer sales in those expensive provinces, was enough to offset price gains in all other provinces.

Looking even further ahead, the national average home price is forecast to increase by 3% in 2026 to $697,929. This would mark the sixth straight year where the national average home price remained in and around the $700,000 range.

As for forecasted sales, about 469,503 residential properties are expected to trade hands via Canadian MLS® Systems in 2025, representing a 3% decline from 2024.

British Columbia, Alberta, and Ontario are the only provinces forecast to post declines this year, slightly offsetting gains everywhere else.

In 2026, national home sales are forecast to rebound by 6.3% to 499,081, putting activity back on track with what was expected in CREA’s April forecast.

That said, it would still mark the fourth straight year for sales failing to crack 500,000, something that has only occurred seven times going back to the first recorded instance in 2007.

CREA notes all forecasts are still subject to very high levels of uncertainty.