In September, confidence in the Canadian housing market came under renewed pressure. Escalating trade tensions with the United States, coupled with rising long-term interest rates, led homebuyers to become more cautious. Most local real estate associations reported a decline in residential resales, including Vancouver, the Fraser Valley, Calgary, Edmonton, Winnipeg, Hamilton, Kitchener-Waterloo, Toronto, Ottawa, Montreal, and Quebec City.
Prices also weakened in many areas. Vancouver and the Fraser Valley continued this trend, with local prices steadily declining since early 2025. This further confirms that the slight rebound in Toronto housing prices this summer was only temporary and did not change the overall trend of continued depreciation.
Other regions showed signs of price stabilization. Edmonton, which had previously experienced a rapid decline in prices, has seen its rate of decline slow; Ottawa and Montreal, after previously experiencing rapid price increases, have begun to see their growth rates stabilize.
The divergent trends in the Canadian housing market reflect differences in market confidence, housing affordability, pent-up demand, demographics, job market, and housing inventory across different regions. Even macroeconomic factors like interest rates and immigration policies can have varying degrees of impact depending on local market conditions.
Overall, we expect that as housing affordability improves and the Canadian economy remains resilient, pent-up demand will gradually be released, driving a moderate recovery in the Canadian housing market. However, the recovery path is likely to remain volatile, and performance will be highly uneven across different regions.
(The above views are from RBC Capital Markets on October 7th and are for reference only, not investment advice.)
