Markets Jump in October

Seasonally adjusted national sales were up 7.7 per cent in October, after a 2.1 per cent September increase. October’s sales were up 24.0 per cent from October 2023 and were 5 per cent above the average of the previous 20 Octobers.

The market is finally showing signs of life after multiple Bank of Canada interest rate cuts. Ongoing employment gains, while small, provide further encouragement. Sales appear set to rise further as the economy improves, but another big sales jump like October’s is unlikely before spring. By then, rates should be a few points lower and the economic outlook clearer. Recent cuts to planned immigration will eventually trim the stream of potential homebuyers but pent-up demographic demand remains.

New listings dropped 3.5 per cent in October – the first decrease in 7 months – although listings were still 4.4 per cent above their year earlier level. Listings remain relatively plentiful, providing October’s homebuyers with plenty of choice. This good property availability was a further spur to last month’s sales ramp-up. October’s supply was about 6 per cent above its 10-year average.

Accelerating sales and falling listings boosted Canada’s sales to new listings ratio to 58.0 per cent in October from 52.0 per cent in September. This is the highest ratio since July 2023. Our calculations put this ratio in balanced territory; this follows a one-month slip into buyers’ market in September. The national ratio rise coincided with largely unchanged local conditions; 15 of this flyer’s 25 markets had an October sales-to-new listings ratio of at least 50 per cent (which indicates a balanced or tighter market), unchanged from September.

The sales-to-listings ratio jump propelled the national average resale price to a 2.2 per cent gain in October. The increase is the second straight and lifts Canada’s average price to its highest value since April 2022 and up a solid 6.2 per cent from October 2023. Although values advanced in only 14 of this flyer’s 25 markets in October down from 18 areas during September, a big monthly price escalation in Toronto, Canada’s largest market, underpinned the national rise. Prices also rose month-to-month in Montreal but were lower in Calgary and Vancouver. The healthy year-over-year price increase was prompted by hikes in 22 of our 25 markets, with Calgary, Edmonton, Sudbury, Quebec City, Regina, Newfoundland and Labrador (where the real estate board covers the entire province), Thunder Bay and Saint John all posting double-digit gains.

Canadian housing starts also jumped in October, posting an annualized 240,761 units, up nearly 8 per cent from 223,391 units in September. The increase put the 2024 year-to-date average of seasonally adjusted housing starts at 243,876 units, still about 1 per cent above the full-year 2023 pace near 241,660 units. The September reading comes as new unit inventories edged higher for the second straight month, hitting a four-year high, and under construction volumes remain near record levels.

Housing starts rose sharply in Toronto, Vancouver and Calgary, leading October’s national increase. Volumes were up strongly in Kitchener, London, Winnipeg, Kingston and Montreal. Starts sagged in Ottawa-Gatineau after a big jump last month and were also significantly lower in Hamilton, Saskatoon, Windsor, Quebec City and Moncton. Unadjusted starts rose month-over-month in 13 of our 25 cites.

Unadjusted apartment starts rose for a second straight month during October in Canadian centres with at least 10,000 residents. Semi-detached activity also increased. Single-family starts edged lower and row units were little changed.