Home prices drop 4% in Toronto while smaller cities see market boost

Home prices remained down in Canada’s largest cities, including Toronto, in September.

Compared to September 2024, home prices are lower in Canada’s most expensive cities, but in select locales with better affordability conditions, gains are beginning to accelerate, according to the September 2025 house price index report from real estate platform Wahi and Real Property Solutions, a Canadian provider of property valuation services.

“The national numbers are suggestive of a market on pause, though that’s certainly not the case in cities in Quebec and Atlantic Canada, as well as certain parts of the Prairies, which may be heating up more,” said Wahi economist Ryan McLaughlin. “Despite softening in prices for all property types, there’s also a sizable gap between ground-oriented homes and apartments.”

The home price index is based on the latest monthly actual home values in 1,000 towns and cities across Canada.

As in previous months this year, home prices were elevated in 10 of 13 major metro areas that were analyzed in the report. Quebec City and Winnipeg were the lone markets to see prices increase by upwards of 10 per cent on a year-over-year basis.

Cities in western Canada, including Regina, Edmonton, Victoria, Saskatoon and Calgary all saw prices climb along with Halifax, Montreal and Ottawa-Gatineau. But, while Calgary and Edmonton house prices remain up, the pace of appreciation has cooled from double-digit highs earlier this year due to increased housing starts and supply growth.

Toronto and Vancouver saw prices down four per cent year-over-year, while Hamilton had a three per cent decline. The report suggests U.S. steel tariffs could be a factor in the decline in Hamilton.

Looking at variation among property types, condo prices have been down on an annual basis throughout the year, though semi-detached homes joined the fray this summer, the report found. But the condo downturn did not appear to intensify in the latest index. September’s six per cent year-over-year decline is relatively consistent with what has been observed since May. Before that, drops in condo prices were gaining momentum.

“The condo market didn’t appear to fare any worse off in September than it had over the summer, but that’s not necessarily a sign we’ve reached bottom, as certain factors could be sustained headwinds,” said McLaughlin.

The Greater Toronto Area may see a record number of condos completed. McLaughlin noted that some of these units, which began construction during the pandemic boom, may end up on the resale market, boosting inventory levels and further reducing prices in Canada’s biggest condo centre.

See the full report here.