Romana King is an award-winning personal finance writer, a real estate expert and speaker. She is the current Director of Content at Zolo.ca

There’s never a dull day in real estate. Last year started off with a big nervous question: Will the Canadian housing market crash? In 2018, the new year started off with more of a sigh. Analysts across North America came out with various pronouncements of deceleration in activity and pricing, but the overwhelming consensus was that the nation’s real estate landscape would flatten out, even in the hot Toronto and Vancouver markets.

It wasn’t too bold of a prediction. Activity was way down in the summer months of 2017, even as the number of listings was finally growing. This prompted only incremental increases in pricing and a nation-wide expectation of a soft-landing for Canada’s property markets.

This flattening out of the market was happening well before the latest splash of cold water hit the fast-accelerating housing markets. That splash came in the form of amendments to mortgage regulations. Now lenders must qualify new borrowers —and those renewing or renegotiating with a new lender to qualify for a mortgage— using new guidelines. Borrowers are qualified now based on the posted rates, which are typically 200 basis points higher than discounted mortgage rates. These new regulations were announced in October and were officially implemented on January 1, 2018.

What does all this mean for real estate markets in 2018? It means a possible return to the norm —a reemergence of a more boring, stable Canadian real estate market.

Canada’s real estate is actually balanced

According to Robert Hogue, senior economist with RBC Economics, there is “limited downside risks to prices in the near term in Canada” as the majority of housing markets, including Toronto, are “in balance.”

Based on the sales-to-new listings ratio—where 50% is a balanced market—the overall Canadian market appears to be balanced, according to RBC Economics December Monthly Housing Market report. Toronto and Calgary are also in balanced territory while Montreal and Vancouver are still leaning towards a seller’s market.

Source: RBC Economics Monthly Housing Market Update, December 14, 2017

Another way to determine if Canada’s housing markets are levelling off is to examine months of inventory. The number of months of inventory represents how long it would take to liquidate current inventories at the current rate of sales activity. In November 2017, there were 4.8 months of inventory in Canada, down slightly from 4.9 months in October 2017 and the four months of inventory that was recorded in the summer months in 2017. Given that the long-term average is 5.2 months, analysts are predicting that most Canadian market segments are cooling off and returning to a more balanced market where supply meets demand.