Spring brings heightened buyer demand and also historically ushers in a surge of new listings as sellers take advantage of the season’s increase in activity. New listings typically reach their peak in May, however, the uncertainties of the last few years, including mortgage rate hikes and high pandemic home prices, have disrupted the usual ebbs and flows of housing supply levels. But now that housing markets across the country appear to be rebounding and interest rates are expected to drop, this year is poised for a return to more predictable inventory increases. So how much could inventory increase this spring in Canada’s major markets?
This content was originally published by Zoocasa, view original content and infographics here.
Zoocasa analyzed new listings data from January to June over the past ten years in six major markets in Canada and calculated the average rate of increase to predict the potential growth in new listings in May. New listings data was sourced from the Canadian Real Estate Association (CREA).
Toronto’s Housing Supply Improving From 2023
Looking at the last ten years, the average rate of increase of new listings from January to May was 112.8% in Toronto. Using this figure, we expect that the number of new listings in Toronto in May will reach at least 17,688. This is 11.5% higher than the number of new listings in May 2023.
Though buyers will have more properties to choose from than last year, the number of new listings is still far below the pre-pandemic normal. For example, in May 2017, there were a whopping 25,837 new listings on the market. Before that, new listings were typically above 18,000 in May. However, depending on the number of buyers active in the market this spring, the number of new listings could fluctuate.
Will Vancouver’s Supply Growth Help Alleviate the Housing Shortage?
Of the six markets we analyzed, Vancouver has the smallest average rate of increase of new listings from January to May. Vancouver has historically had a short supply of homes and there isn’t likely to be any significant changes to the housing supply in the near future.
Based on an average rate of increase of 44.2%, we predict that Vancouver’s new listings will reach at least 5,408 in May, which is down 6.5% from last year in May. Since new listings in March were already at 4,917, it is possible that new listings in Vancouver could surpass that number and reach closer to 6,000. The last time new listings surpassed 6,000 in Vancouver during the spring season was in May 2022.
Demand Outstrips Supply in Calgary
For the past few years, Calgary has remained in a seller’s market as an influx of out-of-province buyers keeps demand high, with inventory little room to catch up. From January to June each year between 2014 to 2023, the number of new listings in Calgary has only surpassed 6,000 twice - in April 2021 and March 2022. And in most of the last ten years, new listings in May have stayed under 5,000.
With this in mind, and based on Calgary’s average rate of increase of 59.3%, we expect new listings in Calgary to be around 4,358 in May 2024. This is slightly below the number of new listings in May last year but is in line with the number of new listings experienced in 2015, 2016, 2017, and 2019.
Balanced Market Conditions in Edmonton
Edmonton’s housing supply is generally more stable than Calgary’s. In March 2024, there were 4,227 new listings in Edmonton, while Calgary had 4,057. As Calgary becomes more competitive, buyers might find greater value and less competition in exploring the Edmonton market.
With an average rate of increase in new listings of 72%, we predict that Edmonton’s new listings in May 2024 will reach around 4,310. This would be a drop compared to the number of new listings in the past three years, however, sales in Edmonton are not outpacing supply by too much which means the market benefits from much more balanced conditions than Calgary. In March, the sales-to-new listings ratio in Edmonton was 65%, while in Calgary it was 84%.
New Listings to Climb in Tight Halifax-Dartmouth Market
The sales-to-new listings ratio in Halifax-Dartmouth in March 2024 was 80%, representing tight buying conditions. The good news for buyers is that we expect new listings in May to increase by 92.2% to 857 new listings. This would be a 7% increase from May of last year but is still a ways away from the typical 1,000 new listings that entered the market in May of previous years.
Before the pandemic, new listings in May in Halifax-Dartmouth exceeded 1,000, and in May 2015 even reached 1,434.
Hamilton-Burlington Supply Returning to Pre-Pandemic Normals
Of the six markets we analyzed, Hamilton-Burlington has the highest average rate of increase in new listings at 112.9% (just 0.1% higher than Toronto). This means that in May 2024, we expect new listings to increase to at least 2,353. This represents a 17.9% increase in new listings from May 2023 and would provide Hamilton-Burlington buyers with nearly as many new listings as in pre-pandemic years. For instance, in May 2018 new listings reached 2,368, and in May 2019 they reached 2,189.