In response to CMHC, condominium condo gross sales in Toronto have fallen 75% since 2022, whereas Vancouver noticed a 37% drop as of Q1 2025. The sharp downturn has been pushed by a mixture of upper rates of interest, diminished affordability, and waning investor urge for food.
In the meantime, inventories have ballooned. In Toronto, the months of provide for pre-construction condos surged to 58 months in Q1—14 occasions increased than in 2022. Vancouver is going through comparable, albeit much less excessive, challenges.
Falling costs, rising losses
Rental resale costs have slipped 13.4% in Toronto and a pair of.7% in Vancouver since 2022, erasing a few of the double-digit positive aspects seen throughout the pandemic housing increase.
For buyers who purchased pre-construction models anticipating continued development, this has translated into potential capital losses of as much as 6% on 2024 purchases in Toronto, the company famous.
CMHC says profitability for buyers within the Toronto and Vancouver condominium markets is “underneath stress,” citing the consequences of upper borrowing prices and stagnant worth development. Since 2022, investor carrying prices have risen 24% in Toronto and 29% in Vancouver, whereas rents have grown at a slower tempo—15% and 12%, respectively.
As resale values dip beneath buy costs, securing financing at closing has additionally grow to be harder.
A wave of challenge cancellations
Unsold stock can also be delaying or derailing future development. In Toronto, 55% of pre-construction models remained unsold in Q1 2025—simply shy of the report 56% seen in late 2024.
That’s effectively beneath the 70% pre-sale threshold lenders usually require to launch challenge funding.
These challenges have led to a wave of cancellations, with the variety of cancelled apartment models up five-fold in Toronto and 10-fold in Vancouver from 2022 to 2024. Whereas some builders have pivoted to purpose-built rental initiatives, others have shelved plans solely.
Quick-term reduction, long-term threat
For now, the slowdown has introduced some reduction for consumers and renters. Rents have moderated, and costs have softened, easing circumstances in Canada’s two most costly housing markets.
However that reduction could come at a value.
“The condominium initiatives cancelled right now imply fewer housing completions sooner or later,” CMHC warned. “The reduction for consumers and renters is short-term, with future housing shortages compounded.”
With completions anticipated to stay excessive and demand nonetheless subdued, CMHC sees continued stress on costs and rents within the close to time period. However the longer-term concern is evident—right now’s slowdown may deepen Canada’s structural housing scarcity down the road.
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Final modified: June 10, 2025
