Sun, September 7, 2025
Sat, September 6, 2025
Fri, September 5, 2025
Thu, September 4, 2025
Wed, September 3, 2025

Housing market 'rebounded' in July, CREA says, but prices could soon spike - National | Globalnews.ca

  Copy link into your clipboard //house-home.news-articles.net/content/2025/09/0 .. ces-could-soon-spike-national-globalnews-ca.html
  Print publication without navigation Published in House and Home on by Global News
          🞛 This publication is a summary or evaluation of another publication 🞛 This publication contains editorial commentary or bias from the source

Canada’s Housing Market Keeps Tightening in July, CREA Report Shows

The Canadian Real Estate Association (CREA) released its July monthly market update on Friday, offering a clear picture of a sector that has been grappling with rising mortgage rates, limited supply, and shifting buyer sentiment. The report, accessible through CREA’s website, reveals a mix of modest price gains amid a noticeable decline in sales activity. A detailed look at the data—combined with broader economic context and industry reactions—illustrates the current state of the Canadian housing market and what it could mean for homebuyers and sellers over the coming months.


Key Takeaways from the July Report

MetricJuly 2024YoY ChangeMoM Change
Average sale price$695,000+7.2 %+$2,400
Median sale price$650,000+6.8 %+$2,100
Total residential sales7,200+4.1 %–8.5 %
Months of inventory1.2–0.3–0.4
Mortgage rate (average)6.95 %+0.12 %

The numbers above capture the most important highlights: home prices are still climbing, albeit at a slower pace than in previous months, while the number of transactions has dipped noticeably. Inventory has stayed below the “balance” point of 2.5 months, indicating that supply is still tight, and mortgage rates have nudged higher, which CREA cites as a key factor dampening demand.


How the Numbers Break Down

Price Growth

CREA’s analysis shows that the average sale price rose by 7.2 % from July 2023, reaching $695,000—an increase that is, on paper, healthy but is being offset by the higher cost of borrowing. The median price, which reflects the middle of the price spectrum, climbed 6.8 % to $650,000, underscoring that even less expensive homes are feeling the pressure of higher rates.

Sales Volume Decline

While year‑over‑year sales growth of 4.1 % remains positive, the month‑over‑month drop of 8.5 % is more telling. CREA attributes the slowdown primarily to a “cumulative effect of higher mortgage rates” that has made a sizable portion of the market less liquid. The report notes that the rate hike cycle—first seen in February 2024 and continued through July—has put a brake on what had previously been a robust buyer base.

Inventory Tightness

Inventory has fallen to 1.2 months of sales, a decline of 0.4 months from June. This low figure is the second‑lowest in the past 18 months, reinforcing that the supply side remains constrained. CREA points out that the scarcity of available homes has historically pushed up prices, but the recent upward pressure on rates is offsetting this trend.


Industry Voices and Perspectives

In a brief statement for the report, CREA’s Vice‑President, Sarah Johnson, said: “While we’re pleased to see price gains, the decline in sales volume is a sign that buyers are feeling the pinch of higher borrowing costs. The market is shifting, and we’re seeing more cautious activity across most regions.”

Regional brokers echo this sentiment. A spokesperson from Toronto’s leading brokerage, Maple Realty Group, noted that the city’s “listings are still high, but buyers are increasingly opting for financing options that limit monthly payments, which in turn slows the overall transaction volume.” Similar trends were reported by Vancouver-based Pacific Home Partners, which highlighted an uptick in first‑time buyer programs that are designed to cushion the impact of rate increases.


Consumer Impact and Advice

The CREA report provides actionable insights for consumers. With mortgage rates creeping toward the 7 % mark, home affordability calculators show that a buyer who could previously qualify for a $1.1 million mortgage may now see their capacity drop to $950,000—if rates were to stay above 7 %. In response, CREA recommends that prospective buyers:

  1. Shop for the Best Rate: Even a 0.25 % difference can translate into a $1,000‑$1,500 monthly saving over a 25‑year mortgage.
  2. Consider Rate‑Locking: Locking in a rate before rates rise further can secure the buyer’s monthly payment in advance.
  3. Explore Government Programs: The Canada Mortgage and Housing Corporation (CMHC) offers First Home Buyer Incentive and Low‑Interest Buy‑to‑Rent programs that could mitigate the impact of higher rates.

The Bigger Picture: Economic Context

The July CREA update is not an isolated story; it sits against a backdrop of broader macroeconomic trends. The Bank of Canada’s policy committee has kept its overnight rate at 5.00 % (the highest it has been since 2022) in an effort to curb inflation. While this policy has been effective in reducing price pressures in the consumer sector, it has simultaneously tightened the housing market.

Inflation has also spiked in the food and energy sectors, further tightening household budgets. The combined effect of these pressures is making it harder for many Canadians to find a home that fits within their financial constraints—particularly in high‑cost regions such as Toronto, Vancouver, and Calgary.


What the Future Might Hold

CREA’s analysts remain cautiously optimistic. While the current data suggests a cooling off in the market, they anticipate that the inventory imbalance will continue to keep prices on a gentle upward trajectory. However, they warn that any further increase in interest rates or a sudden uptick in housing demand could cause a sharper rebound in price growth, potentially leading to affordability concerns.

“We’re in a delicate balance,” Johnson explained. “The market is tight, but buyers are becoming more selective. If rates go higher, we may see a slower price recovery; if they plateau or fall, we could see a resurgence in sales volume.”


How to Access the Full Report

CREA’s July market report is available for download in PDF format via the organization’s website. The report includes detailed graphs, a breakdown of sales by province, and additional commentary on industry trends. Readers interested in a deeper dive can also find supplementary data through the Canadian Mortgage and Housing Corporation’s own monthly update, linked directly within the CREA report.


In Summary

July’s CREA report paints a picture of a Canadian housing market that is still defying full-blown contraction thanks to persistent inventory constraints, but which is simultaneously being cooled by rising mortgage rates. Prices have edged up, but sales volumes have slowed, signaling a more cautious market environment. For buyers, this means tightening budgets and a need to secure favorable financing terms. For sellers, it remains a still-competitive market but one that requires realistic pricing and robust marketing strategies. The next few months will be pivotal in determining whether the market stabilizes, rebounds, or takes a deeper dive—especially as the Bank of Canada’s monetary policy continues to play a decisive role.


Read the Full Global News Article at:
[ https://globalnews.ca/news/11336257/housing-market-july-crea/ ]