Canada’s fall housing market is off to ‘low-key’ start, RBC report shows

Canada’s fall housing sales saw an “uneven and fragile” market in September, a new report from the Royal Bank of Canada shows.

September data from local real estate boards showed a “low-key start to the fall for Canada’s housing market,” the report said.

While some major markets — Winnipeg, Regina, and Toronto — saw home resales go up from August to September, most markets remained tepid.

Vancouver, Calgary, Edmonton, Saskatoon, Hamilton, Ottawa, Montreal and Halifax saw slight declines, “suggesting the recovery is still uneven and fragile,” RBC economist Robert Hogue said in the report.

Buyers felt little urgency to purchase homes in September, handing them more power in negotiations.

“In Ontario, British Columbia, and parts of Alberta, expanded inventory levels are providing buyers with wider selection and stronger negotiating positions,” the report said.

Many are expecting prices to drop further, allowing them to take a “wait-and-see” approach.

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Toronto is seeing “decades-high” inventory, which is leading to a decline in the value of homes. For the 10th time in 11 months, the average home price in Toronto fell, settling at $971,500 in September.

Compared to the peak of the housing market in early 2022, this is a 25 per cent decline in home values — or a drop of $320,000 in the average home price.

The drop in home values has encouraged buyers in Canada’s largest city, the report shows. While compared to August, home resales rose only two per cent, there has been a 22 per cent increase in home resales over the last four months.

However, the recent drop in home prices has only partially managed to reverse the massive surge in prices after the COVID-19 pandemic.

“The road ahead is likely to be bumpy,” Hogue said in the report.

Vancouver also saw rising inventory and declining home values, but it continues to remain Canada’s least affordable housing market.

The average home price in Vancouver was around $1.14 million in September, down 3.2 per cent ($38,000) from a year ago and more than nine per cent ($118,000) since the peak of the spring of 2022.

The uneven and divergent regional real estate trends will continue into winter and even into early 2026, however, a recovery may be on the horizon, the report said.

“We anticipate a more robust recovery will gradually emerge as economic momentum builds, and employment conditions stabilize,” Hogue said.