RBC’s Eighth Bottom Call: What Serious Investors Should Read Between the Lines
Canada’s largest bank has once again declared the housing market has found its floor. This is the eighth such call from RBC in four years, and for anyone allocating capital based on bank commentary alone, that track record deserves more scrutiny than the headline it generated.
RBC’s August update points to a seasonally adjusted rise in home sales and a second consecutive monthly increase in the national MLS Home Price Index, the first back to back gain since early 2024. On the surface, that reads like a turning point. But investors who have been through a full cycle know that seasonally adjusted data is built to smooth out predictable noise, not to signal asset repricing. The bank itself concedes the market remains soft and that any recovery will be gradual, which is a materially different message than “the bottom is in.”
What matters more for capital allocation is what the unadjusted regional data actually shows. Since the March 2022 peak, the national benchmark price has fallen 21.3 percent, but that decline is concentrated almost entirely in two provinces. Ontario is down 25.5 percent and British Columbia is down 15.5 percent. Every other province is sitting near or at record highs. That is not a national correction bottoming out. That is a two market drawdown dragging down a composite number while the rest of the country never actually corrected.
If most provinces are within a few points of record highs, affordability has not actually improved. It has simply stopped worsening in two markets that were the most stretched to begin with.
This distinction matters for anyone weighing entry timing. RBC has now made this call in December 2022, March 2023, February 2024, January 2025, and again this month, adjusting the timeline each time reality failed to cooperate. None of those prior calls factored meaningfully in credit conditions, the lag between rate policy and market impact, or demand that had simply been pulled forward. Investors underwriting a purchase on the assumption that a bank forecast de-risks the timing decision are underwriting on sentiment, not fundamentals.
There is also a financing question worth flagging. Government backed lending to institutional buyers and continued rate cuts can both juice short term transaction volume, but neither addresses the underlying affordability gap. Bank of Canada staff research has itself warned that rate cuts can worsen affordability over time by pulling forward demand without expanding supply. For an investor, that kind of stimulus driven volume is a weaker signal than organic demand growth, and it tends to unwind once the support is removed.
None of this means the market cannot stabilize. It means the case for a durable bottom needs to rest on income growth, credit availability, and genuine supply and demand balance in the specific markets you are underwriting, not on a composite index or a bank’s eighth attempt at a call it has missed seven times before. Discipline on entry timing, not headlines, is what protects returns through the next leg of this cycle.
Source: Better Dwelling
