Canadian Housing Sales Decline 20% Since November Peak, Slowdown Spreads

The Canadian housing market is experiencing a widespread slowdown, with sales activity notably decreasing across major urban centers. As highlighted by Jon Hartley of the National Post, the trend indicates that "From Toronto to Vancouver to Ottawa: The housing slowdown Is spreading." This cooling period is largely attributed to persistent high interest rates, escalating trade tensions, and affordability challenges that have deterred prospective buyers.

While the national picture shows a broad deceleration, the impact is particularly pronounced in Ontario and British Columbia. Cities like Toronto and Vancouver have seen significant drops in sales and prices, with their condo markets facing substantial losses and an oversupply of units. The capital city, Ottawa, also reflects this spreading trend within Ontario, as new home prices declined in June 2025 according to Statistics Canada. In contrast, markets in Alberta, Atlantic Canada, and Quebec have shown more resilience, with some areas even experiencing continued price growth.

Economic factors are playing a critical role in this downturn. The Royal Bank of Canada (RBC) reports that national home resales are projected to decline by 3.5% in 2025, primarily concentrated in Ontario and British Columbia. The overall volume of residential sales has fallen by 20% from its recent high in November, according to the Business Development Bank of Canada (BDC), as economic uncertainty prompts households to postpone major purchases. High development and construction costs, coupled with a surge in existing home inventory, have further dampened new construction activity, especially in Ontario.

The Canadian Real Estate Association (CREA) has significantly revised its 2025 forecast, now projecting essentially flat sales and a slight decline in national average prices. Oxford Economics warns that the current slump could extend into 2026, particularly if trade tensions with the United States remain unresolved, exacerbating economic uncertainty and impacting consumer confidence. This downturn in housing, a sector that contributed $143.4 billion to the Canadian economy last year, poses broader risks to job growth and government revenues.

Despite the softening resale market, efforts to address the chronic housing supply shortage continue. The Canada Mortgage and Housing Corporation (CMHC) forecasts a rebound in housing starts in some regions, supported by lower interest rates and government initiatives. Prime Minister Mark Carney's administration has also introduced the "Build Canada Homes" initiative, aiming to accelerate construction and improve affordability across the country in the long term, though the full impact of these measures will take time to materialize.