Home-Seller Optimism Spikes Ahead of the Spring Market

Canadian home sellers aren’t as quick to pull their listings from the market as they have been for much of the past year, suggesting they’ve developed warm feelings for the spring market.

By Josh Sherman | 4 minute read

It’s not uncommon for a seller to temporarily delist their home if it isn’t getting the attention they’d hoped for, but that’s happening less these days in Canada, one economist notes.

We’re not even halfway through winter and already Canadian home sellers appear to be banking on a stronger spring housing market, analysis from National Bank suggests.

“Faced with renewed momentum over the past few months, the proportion of sellers cancelling their listings during the month [of December] reached its lowest level since May 2023 as more sellers are expecting to close a deal on advantageous terms,” notes National Bank Economist Daren King in a recent report.

Some 17.8% of homes available for sale in the final month of 2024 were taken off the market. It was only the second time last year that the share of delisted homes sunk below 20%, with this past April — typically one of the strongest months for home sales — dropping to 18.6% as well. 

The National Bank report responds to the latest monthly data from the Canadian Real Estate Association (CREA), which was released on Jan. 15. In December, home sales dropped 5.8% on a month-over-month basis but were up 13% from the same time last year, according to CREA. Meanwhile, the national index price climbed 0.3% compared to November, standing just 0.2% below year-ago levels.

Seller Sentiment Varies by Region 

While the numbers hint at a broadly more upbeat outlook for the housing market, trends varied across the nine provinces National Bank tracks. “Overall, Ontario remains elevated on a historical basis and has the highest proportion among Canadian provinces at 30%, but that… proportion decreased since September (35%),” writes King in an email to Wahi.

In the Greater Toronto Area, Wahi Partner Realtor Grant Allardyce has noticed that sellers do have a more positive outlook on the market these days. “There is optimism,” Allardyce tells Wahi. “The rate decreases are helping,” he adds.

There’s also a political element to the optimism he’s seeing on the ground, he says. “I know the stock market reacted quite favourably when [Prime Minister Justin] Trudeau announced that he would step down,” Allardyce says.

The prospect of a spring federal election has some sellers more hopeful. “Those who felt the gloom and doom in the fall market that waited, are probably in a position where they don’t want to wait anymore,” he tells Wahi. “Obviously the spring market is the top market of the year to list your property in.”

However, he adds, the fact that cancelled listings declined in December may also have to do with individual circumstances. For instance, sellers who are listing homes later in the year rather than waiting for the spring tend to be more motivated. For example, they may have purchased another home already and now need their current property to sell.

“People that tend to list at that period in time are usually in the position where they have to sell, so the chances of them cancelling a listing diminish considerably,” he says.

King attributes the national drop in cancelled listings to two provinces in particular. “The latest decrease was mainly driven by Quebec and B.C.,” he continues in an email to Wahi. 

Nova Scotia, meanwhile, was the province where home sellers were least likely to pull listings in December. There, 6.1% of active listings were terminated.

Don’t Expect a Repeat of the High-Flying 2022 Canadian Housing Market

Some sellers may have high hopes for the spring, but they might want to take a cautiously optimistic approach if a recent big-bank forecast proves correct. 

In a separate report, BMO Senior Economist Robert Kavcic says home prices and sales should increase modestly this year, but it won’t be like the real estate booms of yesteryear.  “While resale prices have found a floor across most markets, it’s still a long way back to the 2022 highs — as we’ve often said, think years not months,” Kavcic notes.

Ongoing affordability challenges, as well as headwinds for investors — with rents falling across much of the country, the math on many investment units doesn’t add up — are expected to keep a lid on prices and sales activity, he explains. “Indeed, even our base-case view, which incorporates a stable economy, steady wage growth and neutral interest rates, home prices don’t push through 2022 levels until about 2029,” Kavcic states.