July: Market continues slight improvement, but remains balanced
July numbers are posted by the VREB and as usual I’ve updated my long running historical data. On the surface, it looks pretty unremarkable. Sales, inventory, and median prices all within a couple to a few percent from this time last year, and a market right in balanced territory. But market conditions took another little step in a positive direction, continuing what we’ve seen since January and tipping just slightly over to the sellers side of balanced for the first time since last October. I wouldn’t get excited about it until we see a sustained positive trend for 12 months but it’s worth watching.
On a seasonally adjusted basis, sales of single family properties were about flat from the previous month while condo sales ticked up a bit from a very weak June.
Total sales are on a slight uptrend, though still solidly on the slow end of the historical range and still not into what you could call a breakout from where we’ve been in the last 4 years.
New lists came in a little weaker in July, which is really the reason behind the small strengthening in the market. It hasn’t been enough months to drag down the trend though and this series is very noisy to start with.
Lower new listings set against steady sales mean that inventory also took a hit. Not just on an absolute level (which is pretty common after the peak spring sales period), but also on a seasonally adjusted basis. Seasonal adjustment always gets a little unstable at the tails, but this is the first substantial decline we’ve seen in adjusted inventory levels since early 2023.
Lower new and active listings drove market balance towards sellers, and that’s visible on both the charts of months of inventory and sales to new list ratio.
Combining the two measures show another small improvement from June, with the market overall nearly perfectly balanced.
Median prices bounced back a bit from the super weak June figures, with both detached ($1,165,000) and condo ($525,000) medians close to what they were a year ago (down 1% and 3% respectively).
For a change, the chart below is the 12-month averages instead of the 3-month rolling average chart I usually post. It shows how little has changed in pricing as the market has bounced between cool balanced to warm balanced over the last few years.
The peak of the market was spring 2022, and since then
- Detached prices are down 9%
- Condo prices are down 13%
- Inflation has cut real prices another 13%
- Nominal incomes are up about 17% (data to 2024, projected to 2026)
- While rates are down by about 1-1.5% from peak
All that has improved affordability substantially, though we’re still not where the market has historically turned around.
For example, payments on a median condo is around 25% of household income, which is a strong improvement from the peak of 35% a few years ago, but in the past, the market didn’t bottom out until payments were below 20%. We could get there with lower rates, lower prices, or a longer period of no movement. Or are we in an era of permanently poorer affordability and this is as low as it’s going to go?
I take it you didn’t watch the podcast where the foreclosure lawyer explains how it actually works.
Foreclosures are usually not a great way to get a deal on real estate. The lender usually has set a minimum sale price to attain, so low ball bids are worthless and ignored. You might save a little money if you’re the successful bidder, but you will definitely get several hidden surprises that you were unaware of since viewing is rarely offered. Best way to get a good deal is to find a private sale or know a realtor that will sell a distressed property directly to you with the approval of the seller. I’ve bought most of my properties that were never listed on MLS. It pays to have to have a lot of connections.
Canadian mortgage performance isn’t a reflection of borrower virtue; it’s a reflection of system design. The architecture of Canadian mortgage finance — full recourse, short terms, and concentrated institutional risk — makes foreclosure a value‑destructive outcome for lenders. As a result, Canadian institutions intervene early and often to prevent loans from sliding into formal delinquency.
By contrast, U.S. foreclosure rates are higher not because Americans are inherently less stable, but because U.S. lenders operate in a framework where non‑recourse rules, securitization, and fast statutory foreclosure processes make liquidation the default remedy. In many cases, servicers are contractually obligated to push delinquent loans into foreclosure rather than negotiate.
Lender behaviour within Canada isn’t uniform either. Large, well‑capitalized institutions have the balance‑sheet flexibility to restructure terms, extend amortizations, or carry arrears while working with borrowers to restore performance. Their diversified portfolios and regulatory oversight make workouts economically rational.
Class‑B and private lenders, however, operate under entirely different constraints. Thin capitalization, concentrated exposure, and investor pressure for short‑duration yield leave them with almost no tolerance for arrears. For these lenders, a delinquent loan is not a problem to manage — it’s a threat to solvency. Their enforcement posture is correspondingly aggressive.
Good primer on foreclosures.
In foreclosure work, the initial appraisal is almost always completed while the owner is still living in the home. The property is furnished, utilities are on, and the overall condition is stable. At that stage, the lender isn’t preparing for a sale — they’re assessing equity and determining how to proceed with enforcement.
If the borrower cannot refinance or resume payments, months typically pass before the file reaches court. By the time a judicial sale is authorized, the property is usually vacant, often winterized, and frequently in a noticeably different condition than when it was first inspected.
By that point, the original appraisal is out of date. It reflects an earlier stage of the foreclosure process — owner‑occupied, lived‑in, and stable — not the current “as‑is, where‑is” reality of a vacant foreclosure asset.
By the time a foreclosure file reaches court, most or all of the homeowner’s equity is usually gone. Carrying costs, arrears, legal fees, and market drift erode the position month by month. What began as an equity‑check for the lender becomes, six months later, a distressed asset with little remaining margin.
For owners facing this predicament — and unable to secure refinancing — the best advice is to hire their own real estate agent early, before a foreclosure charge appears on Title. Once the lender’s petition is registered, the owner loses control over timing, marketing, and negotiation. Acting early preserves whatever equity remains.
If anyone is interested in court foreclosures in BC this is an excellent podcast with a BC foreclosure lawyer -> https://www.youtube.com/watch?v=jUPPARaP5F4&t
There were two sales in 2021 and the first one in 2021 was substantially less than than the second one.
lol, yes pick wisely
or married the wrong person and got divorced.
Frank, easy with Debbie downer stuff. Only reason some people aren’t doing well is because they’re not trying hard enough
255 Government has been an interesting listing over the years. It just sold for the 4th time since 2019. The most recent loss was $349k or 17.5% since the sale in 2021, not including sellers fees. They could have spent $70k/year on rent, kept their down payment in the market and come out way ahead.
650k for 2 floors with 3 bed 2 bath would be attractive if there is a decent sized deck out the back IMO.
A country with the longest coastline in the world should be master ship builders, we aren’t, that’s pathetic. We should be building ships and submarines for the rest of the world. We have all the resources at our fingertips, and shouldn’t be exporting raw steel except in the form of a finished product.
Everything is amazing when you’re looking down from an Ivory Tower. Get down and dirty in the trenches and things have never been worse.
Patrick, good post, Canada has a lot of good stuff happening , Canadians need to to turn those frowns upside down. With money comes happiness
Oh Canada!
A remarkably positive Bloomberg Businessweek segment, praising all things Canadian – Carney, Canadians, Canadian stocks, business opportunities.
The “love” continues in the 800+ comments
The main speaker on the video is Matt Winkler, an American who co-founded Bloomberg news and is still Editor in-Chief.
( ⚠️ Trigger Warning for Canadians: This video contains unusually positive comments about Canada. Canadians accustomed to hearing only what’s wrong with the country may find the optimism disturbing.)
https://youtu.be/xZGbTYirIsk?si=6BM8QibqVNvaB_-q
“This video features Bloomberg News Editor-in-Chief Emeritus Matt Winkler discussing the recent surge in international investment in Canada (0:06-0:26).
Key Takeaways:
• Investment Boom: Canada has experienced record-breaking foreign investment, with $183 billion poured into stocks and bonds over the past year. Since Mark Carney became Prime Minister in March 2025, the Canadian stock market has outperformed major global markets, appreciating by more than 40% (1:12-1:30).
• The Mark Carney Effect: Winkler attributes much of this success to Prime Minister Mark Carney, highlighting his extensive experience as a former Governor of the Bank of England and the Bank of Canada, as well as his past role as chair of the Bloomberg board. His reputation for “reasonable” policies and data-driven decision-making has bolstered global investor confidence (2:15-2:53).
• Economic Resilience: Unlike the US and the Eurozone, Canada has seen a downward trend in inflation, making its bond market highly attractive to investors (1:38-1:53).
• Trade Tensions: Winkler notes that while Canada and the US are close allies, recent trade tensions and tariffs—which he describes as “taxes on consumers”—have caused friction. In response, some Canadian provinces have restricted American alcohol imports, causing significant financial losses for industries like California wine (3:22-4:08).
• Strategic Shifts: Canada is increasingly looking for diverse international partnerships. A notable example is the procurement of 12 submarines from a German company (ThyssenKrupp) rather than a traditional US supplier, signaling a strategic shift in global engagement (5:27-6:05).”
Ground floor exterior entrance strata unit (kind of like a ground level condo) and then a two level towhome on top of that.
This is the best example of stacked townhomes in Victoria -> https://maps.app.goo.gl/He4QQSnwUrHvJkVH9
The lowers have always sold really well in the past which I’ve never understood as they are 500 sq.ft. with limited natural light and no parking but I think they appeal to people with pets having a small patio and exterior entrance door.
I am guessing lowers will be under 450k (assuming one bed) and uppers under 650k and then no GST for first time buyers and no PTT.
2026 homebuying intention survey in Canada shows:
——— BC still highest in Canada, and millennials rising higher with now 25% intending to buy this year. That’s up from 23% in 2025.
——— Overall BCers have highest intention (20%) to buy compared to Canada overall (17%). Lowest province intention to buy is Manitoba (14%).
https://renxhomes.ca/millennials-drive-2026-homebuying-intentions-in-canada
“Millennials drive 2026 homebuying intentions in Canada
Wahi survey shows 25% of millennials plan to purchase a home this year, outpacing all other generations despite ongoing affordability pressures
Canadian millennials are showing they are committed to their plans to buy a home in 2026, even as affordability challenges and economic uncertainties continue to shape the country’s real estate landscape.
According to the third annual 2026 Homebuyer Intentions Survey from digital real estate platform and brokerage Wahi, millennials are more likely than any other generation to say they will purchase a property this year.
The survey found that 25 per cent of millennials say they will “probably” buy a home in 2026, up slightly from 23 per cent last year. This positions millennials as the most determined demographic of prospective buyers in Canada.
Overall, 17 per cent of Canadians report they are likely to buy a home this year, unchanged from previous surveys, suggesting that overall buyer intention has remained steady despite broader concerns about tariffs, job security and affordability.”
Doesn’t the fight now turn into making sure your kids end up in either oak bay or Claremont for highschool if going the public route?
What is a stacked townhome? You don’t own both top and bottom?
Lol you should post that on that Vancouver island housing market fb group or the Victoria subreddit and see what kind of replies you get.
How about this as an example of where the market may be heading?
https://www.youtube.com/shorts/cYUDldP7j1k?feature=share
I think the millenial rush to family friendly housing bubble is over. Now is just little moves from this to that, but mostly we’ve found our spots. All eyes are now on getting the mortgages down and raising the kiddos. Noone wants to take on any more debt because that debt is slavery and we want to travel.
Might be the bottom, might not but after 5 years of flat/down unlikely if the market is to drop further that it would be too much more % wise while on the other side your risk in the next 5 or 10 years that we have a year where prices jump 20% in one year.
For a princpal residence that you plan to live in for 10+ years pretty good time to buy, imo. People have a short memory and have forgotten markets not too long ago where listings hit the market on Thursday and have your offer in at 5 pm Monday along with 10 other offers.
Missing middle has been selling well despite the slow market which makes me thing there is going to be a huge crunch on SFHs in the future (as when the market picks up missing middle will sell even better and more and more SFHs will be bought to be torn down and replaced with missing middle).
Just got an update from Royal Bay and they have 60 stacked townhomes coming this fall. My guess is they are going heavy on townhomes secondary to the GST holiday for first time buyers. The lower stacked units and the townhomes above in these stacked townhomes are both going to be in the ballbark for 1st time buyer budgets.
Grateful for your effort and talent creating these analyses, @leo. Thanks.
Yep, yep it’s looking like the bottom. So the market went down 9 points top to bottom, not a big crash and I’m guessing we will pu those 9 points quick enough
959 Carolwood Dr selling over ask and 200k over assessed at 1.63 is a surprise.
Nah, just trying to give prudent advice for the house hunters still on here. I believe there is a graveyard of past HHV posters trying to time the market while investing in equities and all of them ended in disaster. I’ve been bearish on housing the market since spring 2022, bunch of ignorant people on here thought otherwise and they are all gone now with the exception of Patrick, Thursty and maybe Marko. Now I am saying IMO the bottom is near so if you want to get in the housing market especially SFH, don’t wait too long.
Vic re , lol, you sound like a real estate agent trying to create fomo.
Real estate is dead for a few more years to come, meanwhile the stock market has doubled in the last 4 years.
Been saying this for a long time, bottom is near when you get close to cash flow break even with 20% down. We are close and in some cases there on the recent sales. Don’t wait too long if you want to buy!
Here’s a nice video of a builder in Pacific Palisades addressing construction after the fire in L.A.
https://www.youtube.com/watch?v=eYnVtkviuS0