Analysts expect Canada’s spring housing market activity to rise moderately as buyers respond to lower borrowing costs and improved affordability. After the fourth quarter of 2025, when the national aggregate home price fell 1.5 per cent year over year to $807,200 and declined 1.1 per cent from the previous quarter, the market is showing signs of a rebound, according to the Royal LePage House Price Survey and Market Forecast.
Phil Soper, president and CEO, Royal LePage, said economic uncertainty weighed on consumer confidence and muted the traditionally active fall market. “That said, buyers heading into the spring market have a meaningful advantage over last year: lower borrowing costs, stable or lower property prices, and choice,” he added. “In an era where home inventory is chronically constrained, inventory levels are Goldilocks healthy. Together, these conditions are creating a genuine window of opportunity, particularly for first-time buyers in Canada’s most expensive markets.”
Condo prices fell 2.9 per cent year over year to $575,300, while single-family detached homes dropped to $849,100 in Q4. Both posted quarter-over-quarter declines of 1.3 per cent and 0.9 per cent, according to RPS Real Property Solutions. Toronto and Vancouver, the country’s most expensive metro markets, saw average home prices drop 5.7 per cent and 4.1 per cent, continuing a gradual four-year downward trend. Meanwhile, the Greater Montreal Area’s aggregate home price increased 4.5 per cent year over year.
Royal LePage predicts that by Q4 2026, the median price of a condominium in Canada will decrease to 2.5 per cent, while the price of a detached property will increase 2.0 per cent.
Weak condo market persists in major cities
Elevated inventory, retreating investors, and hesitant first-time buyers have kept condo prices soft in Toronto and Vancouver.
“Condominium markets in major urban centres remain under pressure, as weaker demand continues to collide with increased supply,” said Soper. “During the brief period of elevated interest rates following the pandemic, many small-scale investor-landlords found the cash flow math no longer worked. Higher carrying costs forced some to exit the market, adding to resale supply.
“Under normal conditions, investors would be expected to return as borrowing costs eased through 2024 and 2025. This time, however, the timing worked against them. Reductions in immigration numbers, as well as quotas for temporary foreign workers and international students, have sharply curtailed rental demand, leaving fewer tenant customers just as rates began to fall.”
Spring activity set to pick up, but without a spike
The spring market is expected to bring a renewed sense of momentum, though not the sharp surge in activity seen in past cycles. Consumer caution will likely slow sales and limit price growth, keeping market conditions more balanced.
“Greater clarity on trade relations with the United States would certainly help, but there’s also a more subtle shift underway,” said Soper. “After a full year of economic and political turbulence, more and more households have given up waiting for perfect certainty and are refocusing on what is happening at home, and what matters most: securing the right housing for their families. As that adjustment takes hold, we expect it to gradually translate into increased market participation.”
