Tightening Supply Lifts Market Momentum
Canadian home resale activity notched another gain in October 2025, signaling steady — if cautious — renewal in demand across the country’s housing markets. National MLS home sales rose 0.9% month-over-month, marking the sixth increase in seven months and underscoring a gradual rebound that began in the spring.
The pickup in transactions came as new listings slipped 1.4% from September, tightening overall market conditions. The national sales-to-new-listings ratio climbed to 52.2% from 51% a month earlier, inching closer to — but still below — the long-term average of 54.9%. Historically, ratios between 45% and 65% correspond to broadly balanced market conditions.
Total active listings reached 189,000 at the end of October, up 7.2% from a year earlier but broadly aligned with long-term seasonal norms. The number of months of inventory — a key gauge of supply-demand balance — held steady at 4.4 months for the fourth consecutive month, matching the lowest level since January. That remains slightly below the long-term average of five months. Market conditions typically tilt toward sellers when inventory falls below 3.6 months and toward buyers when it exceeds 6.4 months.
“After a brief pause in September, home sales across Canada picked back up again in October, rejoining the trend in place since April,” said Shaun Cathcart, senior economist at the Canadian Real Estate Association. “With interest rates now almost in stimulative territory, housing markets are expected to continue to become more active heading into 2026, although this is likely to be tempered by ongoing economic uncertainty.”
On the pricing front, the National Composite MLS Home Price Index edged up 0.2% between September and October. On a non-seasonally adjusted basis, the benchmark index fell 3% year-over-year — its smallest annual drop since March — indicating that price declines may be nearing a floor. The national average sale price stood at $690,195, down 1.1% from October 2024.
Taken together, the latest data suggests Canada’s housing market is slowly stabilizing as borrowing costs ease and buyers tentatively re-enter the market — though the path toward a sustained recovery remains bound to the broader economic outlook as 2026 approaches.
