National home sales shifted slightly between June and July, 2023. A 0.7 per cent drop was attributed to a decline in the Greater Toronto Area, although sales were up in the majority of all local markets.

Newly released statistics from the Canadian Real Estate Association found that lower sales in the Fraser Valley also offset gains seen in Montreal, Edmonton and Calgary.

Transactions for July were 8.7 per cent higher than last July – the largest year-over-year national sales increase in more than two years.

“July continued along the same trend we’ve seen emerge in recent months, with sales levelling off and new listings returning in more normal numbers,” said CREA Chair Larry Cerqua. “This has been giving buyers more choice and balancing the market, which as of July was also slowing the rate of price growth.”

Newly listed homes were up 5.6 per cent since June, having gone from a 20-year low in March and nearing average levels by mid-summer.

With new listings outperforming sales in July, the sales-to-new listings ratio eased to 59.2 per cent compared to 63 per cent in June and a recent peak of 68 per cent in April.

There were 3.2 months of inventory on a national basis at the end of July 2023, up a bit from 3.1 months in May and June. While this was the first month-over-month increase since January, this measure is still a full month below where it was at the beginning of 2023, and almost two months below the long-term average for this measure (about five months).

The MLS Home Price Index sits at 1.5 per cent, below year-ago levels and the smallest decline since October 2022. CREA said prices continued to decline through the second half of 2022 so year-over-year comparisons will likely tip back into positive territory in the months ahead.

The average home price in July was $668,754, up 6.3 per cent from last July.

“Following a brief surge of activity in April, housing markets have settled down in recent months, with price growth now also moderating with its usual slight lag,” said CREA’s Senior Economist Shaun Cathcart. “Sales and price growth are already showing signs of tapering off further in August in response to the Bank of Canada’s mid-July rate hike and messaging regarding above-target inflation for longer than previously expected. We’re probably looking at another round of ʻback to the sidelines’ for some buyers until there’s a higher level of certainty around interest rates going forward.”