Detached home sales pick up as Canada’s delayed spring market finds its footing

“After a sluggish first quarter, the spring housing market finally got rolling in May. Several regions are now seeing that uptick in momentum carry into summer, as buyers who held back earlier in the year re-enter the market,” said Phil Soper, president and CEO of Royal LePage. “In many cases, what has kept consumers on the sidelines is not a lack of interest, but a lack of urgency. In markets where inventory levels remain elevated, homebuyers have the luxury of time, browsing at their own pace until the right property comes along. That measured approach is reinforced by a persistent backdrop of economic uncertainty, which continues to shape how and when many Canadians decide to move.”

Toronto and Vancouver saw the steepest annual declines, down 4.6% and 4.5%, respectively, though both markets showed signs of quarterly stabilization. Quebec City, meanwhile, posted its first quarter-over-quarter price decline in more than three years after a stretch of standout growth, a shift Royal LePage broker Michèle Fournier attributed in part to a more cautious buyer pool and looming provincial elections that could add further uncertainty this fall.

Trade and rate backdrop

Adding to the mix of factors shaping buyer behaviour, Canada’s Consumer Price Index rose 3.2% year over year in May, up from 2.8% in April and the highest reading since January 2024, driven largely by energy costs tied to conflict in the Middle East.

The Bank of Canada’s key lending rate has held at 2.25% since October 2025, and Soper said a modest increase, should one occur, is unlikely to shake the market the way earlier rate surges did.

“Should rising inflation become more widespread, the Bank may be compelled to raise rates again,” Soper said. “What our regional experts tell us, however, is that a modest rate increase is unlikely to set off alarm bells. This is not the post-pandemic era, when steep and rapid rate surges sent shock waves through the market. Today’s buyers are thinking strategically, weighing broader risks to their employment and the economy, rather than reacting to incremental rate moves.”