Canadian Real Estate: Your 2025 Market Guide

Hello!

Welcome to this special holiday edition of RealEdge! We’re thrilled to bring you the latest insights, trends, and updates shaping the Canadian real estate market as we are about to step into 2025.

In Today’s Newsletter:
1️⃣ The 2025 Outlook on the Real Estate Market
2️⃣ December 2024 Market Activity
3️⃣ Recent Policy Changes and Their Impact
4️⃣ Regional Market Variations

🚀 The 2025 Outlook on the Real Estate Market

The year ahead looks promising for Canadian real estate:

1️⃣ Interest Rate Reductions:
The Bank of Canada’s recent rate cuts have increased affordability, with the benchmark rate now at 3.75%—its lowest since mid-2023.

2️⃣ Demand Surge:
Immigration-driven population growth and a resilient job market are expected to sustain housing demand, especially in major cities like Toronto and Montreal.

3️⃣ Regional Strength:
The Prairies are poised for price gains of up to 7%, driven by affordability and increased interest in mid-sized cities like Regina and Edmonton.

4️⃣ Technology Integration:
PropTech tools like AI-assisted home searches and blockchain-enabled property transactions are becoming mainstream, enhancing efficiency for buyers and sellers alike.

🇨🇦 December 2024 Market Activity

December defied seasonal expectations with a bustling market:

• Sales Momentum: Home sales across Canada saw a 22% year-over-year increase, signaling a strong finish to the year.

• Price Trends: The national benchmark price of $707,700 represents a slight monthly gain of 1.2%, with rural areas seeing stronger appreciation.

• Inventory Constraints: Active listings are down 8.3% from December 2023, keeping competition tight in high-demand regions.

📜 Recent Policy Changes and Their Impact

Several key policies took effect in late 2024, shaping the 2025 market landscape:

1️⃣ Extended Amortization Periods:
First-time buyers now have access to 30-year amortizations, reducing monthly payments and increasing accessibility.

2️⃣ Higher Insured Mortgage Cap:
The new cap of $1.5 million aligns with market realities, especially in high-value areas like Toronto and Vancouver.

3️⃣ Sustainability Incentives:
New tax credits for energy-efficient home upgrades are encouraging green renovations and new builds.

💬 Regional Market Variations

Ontario and British Columbia:

• GTA: The average home price climbed to $1,094,100 in November, reflecting renewed buyer confidence.

• Vancouver: Luxury properties are driving sales, while smaller markets like Surrey remain popular with young families.

Prairies and Atlantic Canada:

• Alberta and Saskatchewan saw 6-9% annual price gains, while Nova Scotia reported some of the fastest-growing rental demand.

Quebec and Maritime Provinces:

• Affordable markets like Halifax and Quebec City are drawing attention from investors seeking strong returns.

• Interest Rate Recovery: Monetary easing has significantly improved borrowing conditions, fueling optimism for a strong start to 2025

• Housing Affordability: Despite policy shifts, affordability challenges persist in high-demand regions, particularly for first-time buyers

• Shifting Preferences: Larger homes with office spaces and energy-efficient features remain highly desirable post-pandemic.