Canadian Real Estate Shows Signs of Recovery as Home Sales Rise

Canadian real estate markets may be turning a corner, with May''s housing data revealing a 3.6% monthly increase in home sales—the first uptick since November 2024. Calgary, Ottawa, and the Greater Toronto Area led the gains, while price declines stabilized, suggesting a potential return to equilibrium.

The iShares S&P/TSX Capped REIT Index ETF (XRE) edged higher in Monday trading, reflecting cautious optimism. New listings ROSE 3.1%, and the Home Price Index remained virtually flat with only a 0.2% dip. While one month doesn''t establish a trend, the figures challenge narratives of prolonged contraction.

Market observers now question whether earlier slowdowns stemmed from transient factors like tariffs rather than structural weakness. The REIT sector''s muted response indicates investors await further confirmation of sustained demand.