A lean year in Canada’s housing market is coming to a close, with tariff chaos, falling property values and condo crises in the country’s two priciest cities all contributing to a tepid 2025 for homebuying.
With predictions already rolling in for 2026, hopes are high that activity will tick up in the 12 months ahead – but few in the mortgage industry are expecting the market to roar back into life anytime soon.
That’s because prices are still on the wane across plenty of key markets, with many would-be buyers sitting on the sidelines as they wait to see how low they’ll ultimately fall.
And in Toronto, some buyers are still seeing headaches when it’s time for an appraisal on their new purchase, according to 6ix Mortgage broker Taz Zaide (pictured top).
“We’ve started doing appraisals now for properties that are coming up for closings and what we’re seeing is that the values are coming in lower than what they purchased for back in June, July, even August,” he told Canadian Mortgage Professional. “So we’ve still seen a little bit of a dip in prices.”
‘It sounds like we’re going to be in a sideways market’
In October, the number of newly listed properties on the national market fell by 1.4% compared with September, according to the Canadian Real Estate Association (CREA) – but many markets are still seeing much more supply than demand, giving buyers the upper hand over sellers.
For sellers, particularly those who want to upsize but find themselves unable to shift their current home for the price they want, that’s creating fresh challenges.
“I do still think that right now, buyers have that advantage because sellers are desperate to sell,” Zaide said. “Obviously, they’re still worried that things might not go back up again. And it sounds like more than ever, we’re going to be in a sideways market.”
That’s not to say activity will be dead. Even with the trade war rumbling on and economic uncertainty continuing, plenty of buyers will still see 2026 as their time to move, whether for job, family, or other reasons.
“I think people just need to make the move based off what they’re comfortable with, rather than trying to time the market,” Zaide said. “You can’t really time the market – especially right now, with all the uncertainty.”
Recovery likely to be stronger in certain markets
Experts including Royal Bank of Canada (RBC) economists have highlighted that Canada’s housing market recovery remains highly regional, and that the outlook generally varies depending on where in the country a buyer or seller is.
In Quebec, Manitoba, New Brunswick, Nova Scotia, and Newfoundland and Labrador, for instance, sellers are still in the driving seat with home values on the up, demand relatively high, and supply scarce.
For Ontario, British Columbia, and Alberta, the picture is more complicated – and the much-discussed condo market woes of the past 18 months in Toronto and Vancouver are likely to remain a big talking point in 2026.
New inventory is still coming to market in Toronto, even despite plummeting appetite for those condos and the prospect of thousands of units sitting empty in the months ahead.
And while the outlook in Vancouver isn’t as gloomy as Toronto, national housing agency Canada Mortgage and Housing Corporation (CMHC) has indicated it’s keeping a close eye on both markets, even if a crash similar to that seen in Toronto in the 1990s doesn’t appear imminent.
“Things have still been stagnant and have not changed in comparison to where they were just in the summer,” Zaide said of Toronto’s moribund condo market. “It’s unfortunate.
“We’ve seen a lot of clients that have bought condos, especially newbuild condos, and they’re coming in under asking by a significant amount. So it’s just one of those things – where that market is, I think that’s going to take some time to catch up.”
CMP
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