Canada’s housing market is shifting toward balance this fall, as easing borrowing costs and rising listings give buyers more options. According to the Royal LePage House Price Survey and Market Forecast, the aggregate price of a home in Canada rose just 0.1% year-over-year to $816,500 in the third quarter of 2025.
While prices remain largely stable, demand is improving slowly as the fall market gets underway.
Home Prices Stabilize, but Momentum Slows
On a quarterly basis, home prices declined 1.2% nationally, with drops seen across many major markets.
- Single-family detached homes: median price up 1.2% year-over-year to $860,600
- Condominiums: median price down 1.6% to $580,700
“Canada’s housing market is moving toward a more balanced state,” said Phil Soper, president and CEO of Royal LePage. “For the first time in years, buyers in previously supply-strapped markets have real choice and negotiating power.”
Soper noted that easing prices, more inventory, and renewed confidence are creating better conditions for buyers. With further rate reductions expected in early 2026, stronger market activity is likely by spring.
Buyers Cautious Despite Improved Affordability
After a slow start to the year, national home sales have risen for five consecutive months, according to the Canadian Real Estate Association (CREA). Still, many Canadians remain hesitant to buy.
“Affordability is improving and the economic backdrop is stable, yet consumer confidence is lagging,” said Soper. “Some buyers are waiting to see if prices dip further before stepping in.”
Compared to the pandemic peak in spring 2022, national home prices are down roughly 5%. The steepest declines are in Toronto and Vancouver, where prices sit more than 12% below their peak. In contrast, home values continue to climb in Quebec, the Prairies, and Atlantic Canada.
Regional Highlights
- Greater Montreal Area: Aggregate price up 4.9% year-over-year
- Greater Toronto Area: Prices down 3.5%
- Greater Vancouver: Prices down 3.1%
- National year-end forecast: Adjusted downward, with home prices expected to increase just 1% in Q4 2025compared to last year
Royal LePage applauded the federal government’s renewed commitment to build more housing, but cautioned that long-term affordability will require a significant and sustained boost in housing supply.
Interest Rate Cuts Offer Relief
The Bank of Canada has now cut twice this fall: 25 bps on September 17 to 2.50%, and another 25 bps on October 29 to 2.25%. In its statements, the Bank cited softer growth and easing inflation pressures as reasons to continue normalizing policy, while external headwinds have also weighed on the outlook.
“Inflation has stayed within the Bank’s target range for twenty months, which is a positive sign,” said Soper. “Mortgage rates are once again in the threes—a supportive level by historical standards.”
Despite national challenges, affordability and stability are improving. Many experts believe that by spring 2026, Canada’s housing market will see stronger activity as confidence rebuilds.
Source: Royal LePage House Price Survey and Market Forecast (Q3 2025)
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