New Canadian Home Prices Continue to Slide

While signs point to new home prices falling in Canada, there are some notable exceptions such as Calgary and Victoria, where demand is higher.

By Josh Sherman | 3 minute read

Canada’s national statistics agency says new home prices are lower than a year ago but have recently been stabilizing.

Key indicators of new home prices in Canada suggest prices are still trending lower across the country, but not every city is feeling the slump. 

Statistics Canada’s New Housing Price Index edged down 0.4% in March, the most recently available month of data, compared to the same time a year ago, according to a news release. Ottawa — which Wahi analysis found was an overwhelmingly buyer-friendly market in the first quarter — saw the largest annual decline at 4.9%, with London, Ont., trailing at 2.2%, and Saskatoon at 1.9%.

On a month-over-month basis, the index remained unchanged, with prices flat in 12 markets. However, six of the country’s 27 metro areas saw declines, led by three Ontario markets: Ottawa (-0.9%), London (-0.3%), and Kitchener–Cambridge–Waterloo (-0.3%).

“The Bank of Canada held the policy interest rate unchanged in March at 5.00%, which continued to cool the new housing market as high mortgage rates remained prevalent,” according to Statistics Canada.

In Canada’s largest market, the Greater Toronto Area, prices for both condos and single-family homes are falling, according to data from Altus Group and presented by Building Industry and Land Development Association.

The benchmark asking price for a new GTA condo unit was $1,054,906, down 6% year-over-year. Meanwhile, the benchmark asking price for a single-family home was $1,594,951, down 11% during the same period.

A separate report from real estate consultancy Urbanation suggests developers have shelved 60 projects in the Greater Toronto and Hamilton Area since 2022 due to plunging sales. For projects that are selling, developers have been offering a variety of incentives beyond lower pricing, such as free or discounted parking spots, in an effort to court buyers on the sidelines.

However, not all markets are experiencing declines. On the east coast (St. John, Fredericton, and Moncton), the new home price was up 0.7%, the biggest month-over-month leap recorded on the Statistics Canada index. Calgary and Victoria saw the index price climb 0.5% over the same period. On an annual basis, Calgary new home prices rose 3%, with only Quebec City registering a more substantial uptick (3.2%). Over the long term, Calgary’s relative affordability compared to other major cities has helped sustain demand (and price growth) as homebuyers come from other provinces in search of a better deal.  

There are also early signs that the Vancouver market’s new-home segment may be stirring despite its higher price points. While Statistics Canada’s index price was flat in March, a report from MLA Canada, a B.C.-based real estate services firm, suggests the market picked up in April.

In Greater Vancouver, 17 new-home projects were launched last month for a total of 1,600 units. Of these homes, 502 sold. That puts the same-month absorption rate — which represents the share of new homes that sell within the month they are made available — at a healthier 31%.

“However, this figure remains 10% below the three-year average, indicating some challenges in the market,” MLA Canada cautions. “Factors such as affordability and pricing incentives continue to influence buyer behaviour, with projects at the higher end facing stiff competition.”