Canada's Housing Market Splits in Two as Toronto and Vancouver Slide

Canada's housing market is showing one of the widest regional splits in years, with Toronto and Vancouver prices off roughly seven per cent year-over-year in April while Montreal continues to gain and Calgary holds essentially flat. The April figures, released by national and regional real estate boards in May, point to a cooling in the country's two most expensive markets even as sales activity in the Greater Toronto Area starts to pick up again.

The national picture

The national average home price rose to $673,084 in April 2026, up 1.4 per cent month-over-month from $663,828 in February, though still 0.8 per cent below the $678,668 recorded in March 2025. The headline number masks sharply divergent regional trajectories, with the gap between hot and cooling markets widening through the spring.

Sales activity has stabilised after a difficult late 2025, helped by the Bank of Canada's earlier rate cuts and an easing of mortgage qualification stress for many buyers. The policy rate sits at 2.25 per cent, with no change expected at the central bank's June 10 meeting.

Toronto: softer prices, more activity

The average selling price of a home in the Greater Toronto Area fell 6.5 per cent year-over-year to $944,100 in April. Single-family homes dropped 6.5 per cent year-over-year to $1,156,100. Townhouses and multiplexes fell 8.1 per cent to $688,900. Condominiums saw the steepest decline, off 8.9 per cent year-over-year to $540,200.

Sales told a different story. The Toronto Regional Real Estate Board recorded 5,946 home sales in April, up 7 per cent from April 2025 and the second consecutive month of year-over-year gains. Listings remain elevated relative to historical norms, particularly in the condo segment, which has been weighed down by investor selling and a glut of newly completed pre-construction units.

Analysts say the Toronto market is in the early stages of a buyer-driven rebalancing, with prices likely to stabilise in 2026 if interest rates remain low and population growth continues. The condo segment, however, remains under pressure from elevated supply and weak rental yields.

Vancouver: still cooling

The benchmark price of homes in Metro Vancouver was $1,098,000 in April 2026, a 6.9 per cent annual decrease and a 0.6 per cent decline from March. Detached house benchmark prices fell 8.3 per cent over the past year to $1,840,700. Apartment prices declined 6.9 per cent year-over-year to $749,692.

Sales activity remained below long-term averages, with 2,110 transactions in April, down 2.5 per cent from a year earlier. The Real Estate Board of Greater Vancouver has flagged a familiar pattern: relatively healthy listings, weak buyer urgency, and a market in which sellers are slowly accepting that the post-pandemic peak is not returning soon.

Affordability in the region remains among the worst in Canada by household income standards. The cooling prices have made only a modest dent in that picture given the elevated baseline.

Montreal still rising

Montreal continues to outperform the national average, with prices up roughly 5 per cent year-over-year. The market has benefited from a tighter supply of resale inventory, strong inward migration from other provinces, and a relative affordability advantage compared to Toronto and Vancouver.

Quebec's provincial government has rolled out additional first-time buyer measures, including a partial reimbursement of the welcome tax for first-time buyers under Premier Christine Fréchette. Those measures are expected to support demand at the entry level, though the overall pace of price growth in Montreal is also being shaped by broader employment trends and immigration flows.

Calgary holds steady

Calgary prices were essentially flat year-over-year in April, marking a pause after the city's strong run of double-digit gains earlier in the decade. Sales activity has cooled from the frenetic pace of 2023 and 2024 but remains above pre-pandemic norms.

Alberta's broader economic story, including the oil price recovery, the federal electricity strategy, and the high-profile separation referendum question on the October ballot, is creating mixed signals for buyers and investors. Some industry watchers say the constitutional uncertainty could weigh on prices at the margin, though most agree the larger driver in Calgary remains supply and population growth.

Mortgage rates and the Bank of Canada

The Bank of Canada held its policy rate at 2.25 per cent at its April meeting and has signalled that inflation pressures, including from higher oil prices linked to Middle East tensions, may keep it on hold for longer. Bond markets are pricing a high probability of no change at the June 10 meeting, with only a 1 per cent chance of a 25-basis-point cut.

Fixed mortgage rates have moved sideways through the spring, while variable rates have been steady. For buyers, the implication is that the cost of borrowing is unlikely to change materially in the near term, leaving prices and supply as the main movers in the market.

Construction and supply

Canada Mortgage and Housing Corporation has continued to warn that the country is well short of the housing supply needed to restore affordability. Housing starts have risen modestly from 2025 lows but remain well below the pace required to meaningfully shift the medium-term picture.

The federal government's housing program, including expanded loans for non-profit and purpose-built rental construction, has begun to scale up. Provincial measures, including Ontario's housing supply legislation and British Columbia's transit-oriented density rules, are starting to translate into permits, but the conversion from permits to completed units remains slow.

The Atlantic Canada story

Atlantic Canada has continued to see strong housing activity, with Halifax, Moncton, and St. John's all posting solid sales numbers and continued price appreciation in many segments. The region has benefited from interprovincial migration from Ontario and from increased visibility as a desirable destination for remote workers.

Affordability in Atlantic Canada remains better than in Toronto and Vancouver but has compressed substantially over the past several years. Local officials in Halifax have flagged housing supply and rental affordability as primary policy challenges, even as the region's growth has produced economic benefits.

Provincial governments in New Brunswick, Nova Scotia, Prince Edward Island, and Newfoundland and Labrador have all been working on housing supply measures, including targeted incentives for non-profit and rental construction.

The northern picture

Housing markets in the Yukon, Northwest Territories, and Nunavut continue to face their own challenges, including high construction costs, transportation limits, and shortage of skilled trades. Federal investment in northern housing has been a focus of multiple recent budgets.

The territorial governments have continued to engage with Ottawa on housing-specific funding and on broader infrastructure that supports housing development. The Carney government's National Electricity Strategy includes northern hydro projects that could lower long-term energy costs for new builds.

The investor segment

The condo investor segment in Toronto has continued to retreat from the market, with elevated listings and weak rental yields prompting some longtime investors to exit. Analysts have flagged the segment as a key vulnerability, given the volume of pre-construction units coming to market over the next two years.

Vancouver has seen a similar but more muted pattern in the apartment segment. Montreal and Calgary remain less reliant on investor purchasing and have not seen comparable softness.

What it means for buyers and sellers

For buyers, the April figures suggest the long-anticipated correction in Toronto and Vancouver is real, though the magnitude is moderate compared with earlier predictions. Affordability has improved modestly. For sellers, the picture varies sharply by city: a Toronto seller faces a different market than a Montreal seller.

For Canadians considering interprovincial moves, the price gaps are wide enough to be a major factor. The continuing affordability of Calgary and Edmonton relative to Toronto and Vancouver is one of the factors driving sustained interprovincial migration to Alberta, although recent political uncertainty around the October referendum has added a new variable.

The rental market dimension

The rental market has cooled in Toronto and Vancouver, with average asking rents declining year-over-year in both cities. Increased supply from completed condo builds, slower population growth, and softer demand from international students have all contributed. Montreal has seen more modest declines, while Calgary has continued to see rent growth.

The cooler rental market has been welcomed by tenants and renters' advocacy groups, who have called for sustained attention to affordability and tenant protections. Provincial rent control regimes vary widely across Canada and remain a defining feature of the rental landscape.

The role of immigration

Immigration has been one of the largest demand-side drivers of Canadian housing markets in recent years. The federal government has signalled a moderation of population growth targets, including a reduction in the planned intake of non-permanent residents. The impact of those policy shifts will continue to filter through the market over the coming quarters.

For housing analysts, the immigration mix matters as much as the absolute numbers. International students and temporary foreign workers have historically been concentrated in the rental market, while permanent residents are more likely to enter the ownership market over time. The composition of the inflow shapes the demand profile.

What's next

The Bank of Canada's June 10 rate announcement is the next major moment for the market. The federal budget and CMHC's next housing market outlook, both expected later in the spring, will shape expectations for the second half of the year.

For now, the message from the April numbers is that the Canadian housing market is no longer a single national story. Toronto and Vancouver are softening, Montreal is gaining, Calgary is holding. The path of interest rates, immigration policy, and provincial measures will determine whether that divergence narrows or widens in the months ahead.