Is the Bottom of the Canadian Real Estate Market Finally Here?

Articles are starting to emerge suggesting that the “B-word” might finally be near.The bottom.Some economists are suggesting the Canadian real estate market is approaching—or may have already reached—the bottom of this downturn. Others are pointing toward signs that the next phase could be a gradual rebalancing of the housing market.But is that actually what's happening?Maybe in some parts of Canada.Here in Greater Vancouver and the Fraser Valley, I'm not convinced we're there yet.In fact, when I look at the statistics in my local market, many of the indicators I follow are still pointing in the wrong direction.The bigger issue, however, is that talking about the “Canadian real estate market” as though it's one market can be incredibly misleading.Let's look at why.

Canada Isn't One Real Estate Market

When economists discuss Canadian real estate, national statistics are naturally influenced by the country's largest housing markets.That can create a very different picture from what buyers and sellers are experiencing locally.On a national level, home prices have actually appeared relatively stable, and seven of Canada's 10 provinces have seen prices increase so far this year.British Columbia hasn't.BC has experienced a decline over the same period.But even saying the “BC real estate market” doesn't tell us enough.British Columbia is enormous.Vancouver isn't Kelowna.Surrey isn't Victoria.And Langley City isn't necessarily behaving anything like Walnut Grove—even though they're only a short distance apart.Real estate is local, and right now that's particularly important.

The Fraser Valley Still Has Problems

My primary marketplace is the Fraser Valley, encompassing communities including North Delta, Surrey, White Rock, Langley, Abbotsford and Mission.And I'm still having difficulty finding convincing evidence that we've reached the bottom.The first problem is sales.2025 was the lowest year for Fraser Valley real estate sales this century.You might expect that after such a difficult year, 2026 would show a significant improvement.Instead, sales so far this year are running approximately 6% below 2025.July's year-over-year numbers were even weaker, with sales down approximately 8.5%.At the same time, average prices across the marketplace declined another approximately 5.5% year-over-year.Those aren't exactly the numbers I would expect to see if somebody told me the local housing market was clearly recovering.

There Is One Important Positive Sign

There is some good news.New listings coming onto the market are declining.July's new listings were down nearly 18% year-over-year.That's important.A housing market generally won't recover if new inventory continues pouring onto the market faster than buyers can absorb it.If sales are weak but the number of new listings falls even faster, eventually the imbalance between supply and demand can begin to improve.We're starting to see some evidence of that.Active inventory across the broader market appears to have turned a corner after climbing earlier in the year.That's potentially an early positive indicator.But an improving inventory situation doesn't automatically mean prices are about to start increasing.There is still a substantial amount of inventory that needs to be absorbed.

The 12-Month Trends Still Concern Me

One of the reasons I'm hesitant to call the bottom is what happens when we smooth out some of the monthly noise and look at the market on a rolling 12-month basis.Several of the statistics I pay close attention to are still deteriorating.Average sales are weak.Average prices are declining.The percentage of asking price sellers are receiving is getting worse.Days on market are increasing.The major exception is active listings, which appear to have turned the corner earlier this year.That's important—but it's only one piece of the puzzle.For me to become significantly more optimistic about prices, I would want to see a more sustained improvement in the relationship between buyers and the inventory available to them.

The Market Can Change Within a Few Kilometres

This is where the national housing-market narrative really starts to fall apart.We don't even need to compare Toronto with Vancouver to find dramatically different housing markets.We can find them within the same city or municipality.Take Langley.In Langley City, inventory in some segments is extremely high and continues to climb.If you're buying into one of those markets, you may have considerable negotiating leverage.You can take your time.You can compare properties.You can potentially negotiate aggressively.And if the supply-and-demand imbalance continues, prices could remain under pressure.Now drive a relatively short distance to Walnut Grove.There, certain segments of the market have been moving back toward seller's-market conditions.A seller with the right property may be able to hold firmer on price.A desirable new listing could attract significant attention quickly.Under the right circumstances, buyers could even find themselves competing.Same broader real estate market.Completely different experience.

Some Buyers Have Enormous Opportunities Right Now

This is why I don't necessarily describe today's market as simply “good” or “bad.”For some buyers, this is an extraordinary marketplace.If you're purchasing in an area with significant inventory and limited buyer competition, you may have negotiating power that simply didn't exist a few years ago.But there's another group that I think has an especially interesting opportunity:Upsizers.Imagine you own a condo or townhouse that's declined in value.That doesn't necessarily mean moving today is a bad financial decision.If the larger property you want to purchase has declined by substantially more dollars, the gap between your existing property and your next home may actually have narrowed.You might sell your existing property for less than you hoped.But you could potentially save considerably more on the property you're buying.That's why looking only at what your current property used to be worth can lead you to the wrong conclusion.What matters is the entire transaction.

Sellers Need to Understand Their Specific Market

The opposite is true for sellers.If your particular market has a significant amount of inventory, limited sales and declining prices, waiting for the market to improve could potentially cost you money.That's particularly true if your primary objective is maximizing your sale price.If prices are declining month after month, today's market value may be higher than the value several months from now.That doesn't mean every seller should immediately put their property on the market.Maybe you don't need to sell.Maybe you're willing to wait several years.Maybe you're selling and buying simultaneously, which changes the equation completely.But if you need to sell in a declining micro-market, hoping that the broader Canadian market improves isn't necessarily a strategy.You need to understand what's happening with properties that directly compete with yours.

Nobody Knows Where the Bottom Is

Here's the part nobody really wants to hear:Nobody knows exactly where the bottom of a real estate market is until after it has happened.We can look for indicators.We can track inventory.We can study sales.We can follow months of supply, days on market, list-to-sale ratios and price trends.All of those statistics can help us understand the direction of the market.But nobody gets a notification saying:Congratulations. Today is officially the bottom.By the time the bottom becomes obvious in the statistics, the market has usually already started moving in another direction.That's why buyers and sellers shouldn't necessarily base major life decisions on somebody's prediction of where the entire Canadian housing market is headed.

There Is No “Canadian Real Estate Market”

If there's one thing I want people to take away from this, it's this:Stop thinking about Canadian real estate as one market.There are markets within provinces.Markets within cities.Markets within neighbourhoods.And even different markets within the same neighbourhood depending on whether you're talking about detached homes, townhouses or condos.One market can have sellers getting slaughtered while another market a few kilometres away has buyers competing for the best listings.The market isn't inherently good or bad.It's good when it's working in your favour and bad when it isn't.The difficult part is understanding exactly which market you're participating in and how to navigate it.For buyers, that might mean identifying areas where inventory gives you substantial negotiating leverage.For sellers, it might mean recognizing that waiting in a declining market isn't necessarily going to produce a better result.And for someone selling one property to buy another, today's difficult market might actually create an opportunity that didn't exist when everybody was excited about real estate a few years ago.So, have we reached the bottom of the Canadian real estate market?Maybe somewhere.But here in the Fraser Valley, I'm not ready to call it yet.Written by:
Steve Karrasch PREC
Karrasch Real Properties Team
Macdonald Realty