2024 was a year of change in the Canadian housing market, led by interest rate cuts. What’s on tap for 2025? It depends on who you ask and where you’re looking. It also depends on your budget, whether you’re a first-time homebuyer, trading up or looking at adding a revenue property to your portfolio. Before we get to our expert realtors, let’s look at what to expect nationally.
The Canadian Real Estate Association (CREA) forecasts a rebound in the housing market for 2025. They expect national home sales to climb by 6.6 per cent as interest rates decline and demand increases. At the same time, the national average home price is projected to rise by 4.4 percent to $713,375 in 2025.
CREA’s optimistic outlook is based on anticipated lower interest rates and pent-up demand flowing back into the market. However, the recovery is expected to be gradual, with a sharper rebound anticipated in the second quarter of 2025. Their forecast suggests a steady improvement in market conditions, with potential for stronger momentum as affordability improves.
A recent Leger survey commissioned by RE/MAX Canada reveals that 49 per cent of participants believe homeownership is attainable, while 36 per cent express optimism about improving market conditions in 2025. The report also predicts a five per cent increase in the national average home price next year, reflecting a more active market and anticipated sales growth in most of the country. RE/MAX says this renewed confidence is particularly strong amongst first-time homebuyers, who are expected to significantly drive market activity in the coming year.
That’s the national outlook, but what about regions across the country? We asked some of Canada’s leading agents for their take on what to expect in 2025.
Cody Sentner (Halifax, NS)
Realtor, KW Select Realty
The 2025 real estate market in Nova Scotia (Halifax Regional Municipality or HRM, Truro and East Hants are my main zones), despite all the turbulence in the world, seems to be trending back to normalcy. Mortgage rates keep coming down, houses are not selling instantly with multiple offers as much and we are seeing open houses and price reductions on listings happening more regularly.
I’ve been working lately with a lot of young or first-time homebuyers who had been waiting for the dust from the “covid market” to settle down. In many instances, we’ve had a chance to get homes for under the asking price.
While no one has a perfectly clear crystal ball to predict the shifts that world events will have on our province and its housing market, anecdotally, I have seen trends taking us back to a healthy market for both sellers and buyers.
I don’t expect we will see housing prices drop like a lot of people expected after the “COVID market” prices, but instead expect them to stabilize. The reason is that for a long time, Nova Scotia had relatively stagnant home prices. I view the boom in prices from the “COVID market” as a catalyst that brought Nova Scotia home prices up to where they should have been climbing naturally over the last decade and a half.
I feel we are slowly coming out of those growing pains and fully expect the market to be in a great place for first-time homebuyers to be able to get great starter homes that fit their lifestyles and family.
One thing to be aware of, if you have school-aged children, is that a lot of schools are also experiencing the growing pains of Nova Scotia’s growth. Class sizes can be a problem in some areas, with many more students than teachers are used to. So, it always helps to talk to people in the area and see how their schools are doing before making a choice.
Related: Real Estate Agents Across Canada Share Their 2024 Predictions
Ming Lim (Toronto, ON)
Head of Realty Broker
Volition Properties
The Toronto real estate market is gearing up for significant activity in spring 2025. After two years of pent-up demand due to elevated interest rates, buyers are returning as rates begin to ease. However, the recovery will differ across market segments.
Starter homes under $1.5 million are projected to see the highest levels of activity. These buyers, highly sensitive to interest rate shifts, are expected to drive increased competition, bidding wars and ultimately higher prices. Mid-tier homes priced between $1.5 and $2.5 million will recover more gradually, while the luxury market above $2.5 million is likely to remain sluggish through 2025. In contrast, smaller towns like Hamilton and Oshawa, which saw demand surge during the pandemic due to Toronto’s overflow, may experience slower rebounds. With Toronto prices now more accessible, buyers are refocusing their attention on the city.
The condo market continues to face headwinds. Low absorption rates – indicating slow sales relative to supply – are keeping resale prices under pressure. With more pre-construction units coming online in 2025, inventory will increase further, exacerbating the issue. The new condo sales market remains frozen, with sales down 91 per cent from the 10-year average, and a rebound is unlikely until the resale market strengthens. For first-time buyers, though, this presents an opportunity to enter the market affordably, without the stress of bidding wars or rushed decisions.
A significant portion of Volition Properties’ client base consists of real estate investors, giving the firm unparalleled insight into the multifamily investment property market. Spring 2025 will present a compelling opportunity for investors.
Historically, the investment market lags behind the single-family home sector, and as home prices trend upward, multifamily properties are expected to follow suit. Lower HELOC (home equity line of credit) rates will allow investors to tap into equity more affordably, while decreasing mortgage rates enhance cash flow potential for new acquisitions, both of which will drive further demand for investment properties.
Activity among sophisticated investors is already on the rise, with many seeking to capitalize on “great deals” ahead of the curve. We anticipate this trend will gain momentum throughout 2025, offering proactive investors a narrow but promising window to secure prime opportunities.
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Matthew Lee (Toronto, ON)
Founder and Managing Partner
Volition Properties
Toronto’s real estate market has become a challenging landscape for first-time buyers seeking more than a tiny condo. Developers have been significantly reducing unit sizes, making them impractical for many homeowners. While investors bought them in vast quantities and leased them to young professionals, these small units are now stagnating on the market. Quite simply, they fail to meet the needs of today’s buyers who are planning ahead and considering starting families. Instead, many first-time buyers are now looking beyond the traditional “shoebox condo” and seeking properties that offer more space, versatility and long-term value, which typically meant they had to look outside Toronto. Volition Properties offers a compelling alternative: duplexes and triplexes that let buyers stay in Toronto and invest wisely.
Recent changes to CMHC mortgage rules, effective December 15, 2024, allow first-time buyers to put down less than 20 per cent on homes up to $1.5 million, with extended 30-year amortizations. This makes small multifamily properties in downtown Toronto comparable to condos in terms of down payment and carrying costs. By living in one unit and renting out the others, buyers can significantly offset their mortgage payments. For example, a $600k condo would require $138k down and cost $3,350 monthly to carry, while a $1.3M triplex would require $153k down and cost about $3,400 monthly after renting out two units.
Duplexes and triplexes are reshaping what a first home can be. Instead of starting with a condo, young buyers can have more space, generate rental income and own a property with superior appreciation potential by opting for a multi-unit property. Not only does this provide a place to call home, but it also introduces them to real estate investing, positioning them for greater financial success. For instance, back in 2019, a young couple bought a triplex through us, and they were able to leverage the equity growth and increasing rents to purchase a second investment property within three years. For over a decade, Volition Properties has helped hundreds of clients leverage this approach to grow their portfolios, and with new CMHC rules, this trend is set to accelerate into 2025 and beyond.
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Randy Bettens (Winnipeg, MB)
Randy Bettens Personal Real Estate Corporation
The real estate market in the Prairies has remained strong throughout 2024, and will continue this trend as we move into 2025. With the Bank of Canada expected to further reduce interest rates, it is almost certain we will see an increase in the demand for housing, along with a similar increase in the cost to purchase a property.
First-time homebuyers should consider purchasing as early as possible in the Spring of 2025 to avoid potential bidding wars later in the year. Consulting with a mortgage expert can assist you in securing the best rates possible, and provide solid advice for managing your financial requirements.
For those looking to sell, start planning now by getting your house ready. Consider hiring a professional staging company to assist in the design and appearance for prospective buyers. A small investment in the saleability of your home will go a long way in maximizing the return on your greatest investment.
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April DeJong (Calgary, AB)
Senior Real Estate Specialist
Royal LePage Benchmark
Premier Danielle Smith recently highlighted that Calgary is a major contributor to Alberta’s economy, including having the highest increase in active businesses among Canadian cities. Alberta’s resilience — driven by increased energy market access, steady population growth and emerging industries like tech, hydrogen and aviation — underscores the exciting opportunities here. Transformative projects like the Calgary Events Centre (part of a $1.22 billion initiative) and over $2.5 billion in residential investment (slated for completion by 2026) have Calgary poised for an exciting future.
Looking ahead to 2025, I’m optimistic for younger and first-time homebuyers, who continue to find opportunities in our market. Calgary and surrounding communities remain a more affordable alternative to cities like Toronto and Vancouver, with a benchmark price that supports attainable homeownership. With a growing construction industry, supply imbalances are likely to ease over time, providing more options for buyers.
The Bank of Canada’s recent interest rate reductions, along with increased inventory, have already sparked increased activity in the mid-range market ($550K–$700K), while the condo segment slows. If rates drop further, the spring market could see a surge, as buyers seize the opportunity to enter the market. Buyers may wish to enter the market earlier and take advantage of a variable rate, which would fluctuate with the rate changes. Historically, homeowners who choose variable rates will save money on interest payments, and you can lock into a fixed rate at any time.
Calgary’s appeal lies in its combination of economic opportunity, quality of life and relative affordability. With a projected two per cent population increase and Alberta’s economic growth expected to lead the country (2.5–2.8 per cent), the 2025 real estate outlook for Calgary and Southern Alberta is conservatively strong. Combined with strong consumer confidence and a stable real estate market, these factors ensure Calgary remains a city of opportunity for years to come.
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Kit Matkaluk and Hugh Cooper (Vancouver, BC)
Kit + Coop
Managing Partners
The Agency Vancouver
Vancouver will be affected by declining interest rates and cooling inflation, leading us to anticipate a temporary lull for sellers over the next two to four months. However, as market sentiment and optimism return, we expect the real estate market to become very active starting in Q2. As we approach the end of 2024, opportunities will abound. It won’t be long before affordable borrowing options create a surge in demand that outstrips supply. By year-end, we project demand to exceed supply, resulting in rising prices, multiple offers and dwindling affordability. For first-time homebuyers, presales slated to close in 1-2 years offer a solid hedge against lower rates and rising property values.
Related: When Will Mortgage Rates Drop in Canada? An Expert Weighs In
Susan Anthony (Sunshine Coast, BC)
Agent
The Agency Vancouver
After a pretty dismal summer and fall in terms of sales on the Sunshine Coast, we are anticipating a bump in the spring next year. Lower interest rates, loosening requirements for first-time buyers and the current high inventory all combine to make a favourable market for buyers.
We are already seeing an increase in interest below about $1 million. The Sunshine Coast generally follows Vancouver by about three to four months in terms of sales. By all accounts, the city is picking up, so by spring we hope to see that bounce. But it’s always a good time to buy on the beautiful Sunshine Coast!
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