A new report says Canada's housing market will see new listings fall in the first quarter before rebounding later in the year and then, slowing to a more modest growth pace in 2024.

The report from Rishi Sondhi, an economist with TD Economics says subdued sales and declining prices will result in listings falling in the first quarter of 2023.

Sondhi then sees listings increasing by seven per cent between the second and fourth quarter before slowing to a growth pace of about two per cent in 2024.

While he predicts some near-term weakness, he also sees rising demand keeping markets balanced and underpinning positive growth in home prices, particularly in the second half of this year. 

However, he says there is some risk that supply grows more forcefully than anticipated as homeowners face record high debt servicing costs.

The Canadian Real Estate Association foresees home sales rising by 10.2 per cent in 2024 as markets continue to return to normal, while it expects the national average home price to gain 3.5 per cent from 2023 to 2024 to around $685,056, below 2022 but back on par with 2021.

This report by The Canadian Press was first published Feb. 9, 2023.