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Despite an uncertain economic outlook, homebuying fundamentals have shown clear improvement in some areas.
Below is a breakdown by key regions:
Ontario (including Toronto)
Ontario, especially the Greater Toronto Area (GTA), remains weighed down by an abundance of listings, particularly in the condo sector. Toronto remains the epicentre for price fragility, thanks in part to a condo sector hampered by immigration slowdowns and overbuilding. Although sales activity has rebounded from spring lows (up 36% from March), prices continue to face downward pressure. The average selling price in Toronto fell 5.2% year-over-year to $969,700 in August 2025. Single-family homes dropped 5.6% to $1,184,700, while condos fell 7% to $571,500. By year-end, prices are projected to decline further by up to 4%, with the number of sales also dropping 5%. Elevated inventory and cautious buyer sentiment are keeping market conditions soft, with slightly longer days on market and muted rent growth.
British Columbia (including Vancouver)
Greater Vancouver continues to face challenges from elevated listings and affordability issues. Prices declined approximately 6.3% year-over-year across detached properties and are expected to fall about 10% through late 2025 as both buyers and sellers remain wary. Sales have dropped significantly, and average days on market have lengthened, reflecting hesitation tied to uncertainty over economic conditions and future price trends.
Developers are growing cautious, especially with higher unsold inventory for condos, despite some support from strong rental demand. A mild rebound in housing starts is predicted for 2025, particularly in the multi-unit and rental sectors, but expectations are for only marginal price growth beyond the immediate rebound.
Prairies (Alberta, Saskatchewan, Manitoba)
The Prairies present a brighter outlook:Saskatchewan is Canada's current hot spot, with average prices up 14% year-over-year in August 2025, reaching $359,379, and Saskatoon up 17%. Tight supply and decent affordability support substantial gains, but moderation is expected as job growth later slows.
Manitoba is similarly buoyant, with average prices up nearly 9% to $395,913 and continued tight conditions signalling near-term gains, though price growth may slow in 2026 as economic momentum ebbs.
Alberta, particularly Calgary and Edmonton, has shifted from ultra-tight to balanced. Sales have dropped and listings have increased, moderating previous double-digit gains. Province-wide, the market remains a seller's market, but price growth has slowed, with some small declines expected if demand remains tepid.
Quebec
Quebec's market is relatively strong, with home resales up 14% in 2025 and modest price gains supported by tight supply despite a recent small slip month to month. Balanced conditions are expected to persist in 2026, although not at the pace of the past year.
Atlantic Canada
Markets such as Prince Edward Island and Newfoundland and Labrador remain brisk, with sales up double digits in early 2025. However, the pace is moderating as price growth has cooled somewhat compared to the post-pandemic surge. Conditions generally favour sellers.
National Trends and Outlook
Nationally, housing prices are predicted to stabilize after the initial rebound of 2025, with slower growth into 2026 as supply and demand become more balanced. Key drivers include:
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Moderating mortgage rates, expanding some affordability by late 2025
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Cautious buyer and seller sentiment, especially in high-priced markets
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Diverging paths: Prairies and Atlantic Canada firm, Ontario and B.C. weak
Expectations for 2026 are for a more balanced national market, with performance closely tied to local economic growth, employment, and inventory dynamics. Most rapid price gains are cooling, but recovery is uneven, emphasizing the importance of monitoring regional fundamentals for any housing or investment decisions.
We expect at least one more 25-basis-point rate hike this year, which will also ease affordability and improve buyer sentiment. There is pent-up demand for housing, boosting next year’s home sales.
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