Canada's real estate market is in turmoil, with two major cities leading the charge in a historic meltdown. While Toronto has been the poster child for condo collapse, Vancouver is quietly suffering its own devastating crisis. After nearly four years of flat or falling prices, Vancouver's condo market is still searching for a floor, with sales hitting their lowest level outside the pandemic since 2018. This is a stark contrast to Toronto, where the condo market is driven by investors and struggling with a historic supply glut. The two cities have very different markets, with Vancouver's higher-priced housing market making apartments an attainable entry point for ownership, while Toronto's falling rents and higher carrying costs have forced owners to put their properties up for sale.
The Greater Vancouver Area's economy is facing challenges on multiple fronts, including a tariff war with the United States that has hit manufacturing, wholesale, and retail trade, as well as transportation and warehousing. The depressed housing market has also pushed the unemployment rate up to 6.7 per cent. Climbing mortgage rates since the start of the Iran war have likely dampened demand, with British Columbia being the most sensitive province to interest rate increases in the country. TD Economics forecasts that Vancouver condo prices will fall another 8 per cent this year before flattening out in 2027, adding up to a 15 per cent drop from their peak in 2023.
Despite the dire situation, Vancouver is still better off than Toronto. The net worth of Canadian households rose 1.3 per cent in the first quarter of 2026 to $18.6 trillion, with real estate adding to that wealth for the first time in a year. However, the recovery in Vancouver's condo market will be a long road, with conditions expected to improve only modestly in 2027 as hiring picks up and lower prices entice more buyers. The dust will settle with Vancouver condo prices still above pre-pandemic levels, which beats Toronto, where prices are expected to fall meaningfully below pre-pandemic benchmarks.
