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“Life is 10% what happens to us and 90% how we react to it.” 
 – C. Swindoll

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2025 has begun with a significant increase in activity bolstered by the recent interest rate drops and impending spring market. January saw a 9% increase in sales when compared with the first month of 2024. That said, there are 33% more homes for sale than this time a year ago, offering more choice to buyers. 

Whether or not prices increase throughout the year (as initially anticipated) will largely depend on whether or not the increase in demand keeps pace with the rate of supply. The sales-to-active-listings ratio for last month was 14%. Broken down by property type, it was 9% for houses, 19% for townhomes and 17% for condos. analysts say downward pressure on prices generally tends to occur when demand falls below 12% for a prolonged period of time, while prices tend to increase when the ratio is sustained above 20%.

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The next Bank of Canada interest rate announcement is March 12th. According to the Financial Post, the likelihood of a rate drop fell from 80% to 55% following Statistics Canada's recently released Labour Force Survey citing lowered unemployment.

 

The new "Flipping Tax" is now in full effect. This tax applies to profits on homes sold before two years of ownership has passed (even if purchased prior to the January 1, 2025 date) and is calculated on a sliding scale up to 20%.  You can find the exemptions here. 

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What is not going ahead are the capital gains inclusion rate adjustments. The Government has announced they are deferring the date on which the capital gains inclusion rate would increase from one-half to two-thirds on applicable gains. The old effective date was June 25, 2024 and this has now been moved to January 1, 2026.

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For those of you who would like to stay ahead of market shifts, we have by-the-week statistics available which provide insights into recent sales numbers and new listing counts by area.  Let us know if you would like these or any other information about specific communities or properties. 

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If you have questions about the market or how any of this information may impact your opportunities, I'm here to discuss or assist in whatever way I can.

You can see the full real estate market report and press release from GRV here.

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