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Canadian home sales in January were up 11% compared to a year earlier, according to the Canadian Real Estate Association (CREA).
On a monthly basis, however, sales were down 3.3%, with much of the weakness occurring toward the end of the month, coinciding with rising uncertainty over tariffs.
"The standout trends to begin the year were a big jump in new supply at an uncommon time of year, as well as a weakening in sales which only showed up around the last week of January," said CREA senior economist Shaun Cathcart. "The timing of that change in demand leaves little doubt as to the cause – uncertainty around tariffs."
The national average selling price increased 1.1% year-over-year to $670,064. Meanwhile, the MLS Home Price Index, which adjusts for seasonal factors and differences in property types, was up 0.7% year-over-year.
CREA reported that new listings jumped 11% month-over-month. As a result, CREA’s months of inventory measure rose to 4.2 from 3.9 in December.
"The big takeaway here is that sales seem to be stabilizing across much of the country alongside lower borrowing costs," noted BMO's Robert Kavcic.
"However, supply conditions are starting to vary noticeably," he added. "The weakest markets are now those that previously saw a large concentration of investors, typically for new condos, where completions are coming to market in a much softer environment."
CREA noted that while it expects a more active spring for Canada’s housing market, it cautioned that the threat of a trade war with the U.S. "is a major dark cloud" on the horizon.
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