Market update February 2025: Big changes ahead

Several major changes since our last housing market update have the potential to disrupt the property sector for some time: Prime Minister Justin Trudeau announced he is stepping down, the Bank of Canada lowered interest rates, and a trade war broke out between the US and Canada.

Economists and PayProp alike expect these events to ripple through the housing market over time.

• The average national asking rent fell by 1.4% from November to a 17-month low of $2,109 in December 2024, according to Rentals.ca. – a 3.2% year-over-year decline.

• Average asking rents for apartments in Ontario fell 4.7% to $2,332, largely driven by a 7.1% decrease in Toronto, where rents now average $2,632. Experts link the trend to unsold condos entering the rental market, an increase in purpose-built rental stock, and reduced demand due to new limits on international study permits.

• Meanwhile, the Canadian Real Estate Association (CREA) reports an average national home price of $676,640 in December 2024 – down 2.6% month over month and up 3% year over year.

• CREA also reports a 5.8% month-over-month decrease in home sales in December.

• Ontario continues to have among the highest average home prices in the country (second only to British Columbia) at $849,600 – 0.2% lower than last month’s average.

• The seasonally adjusted sales-to-new-listings ratio increased in every province from November to December. Even Ontario, previously the only balanced market, now has an SNLR of 77%, meaning that all provinces are now seller’s markets for housing.

• With more focus on rental construction, supply for homeownership has lagged demand. And now, with lower interest rates, sellers may have greater negotiating power.

• The Canada Mortgage and Housing Corporation (CMHC) reports the six-month trend in housing starts was flat in November at 243,268 units.

More rental market headlines

‍How a trade war and US tariffs could hit Canada’s housing market – Global News

‍Who might replace Trudeau as Liberal Party leader? – BBC

‍What 2025 immigration policies mean for property managers – PayProp