The moderation that began tentatively in April has deepened by June. Sales activity has eased noticeably from the frantic records of the first quarter, more inventory is available, and the balance of power between buyers and sellers, while still favouring sellers, is less lopsided than it was a few months ago. Prices remain elevated and near record levels, but the pace of appreciation has slowed and the sense of panic has largely dissipated. This is the healthiest the market has looked in some time, even if it remains far from truly balanced.
Bank of Canada (policy rate) and Statistics Canada (inflation).
Sales Ease From Record Highs
The most measurable change is in transaction volume. Sales have pulled back from the extraordinary peaks of March, a natural consequence of exhausted buyers, stretched affordability, and the front-loading of demand earlier in the year. This is not a collapse; volumes remain historically robust. But the deceleration is real and consistent across most major markets, confirming that the spring frenzy has passed its high-water mark.
Inventory and Balance Improve
With more listings on the market and fewer buyers competing for each one, conditions are edging toward balance. The share of homes selling over asking has declined, and days on market have crept up from the near-instant sales of the winter. Buyers who persevered through the frenzy are finding a slightly more forgiving environment, with time to conduct proper due diligence rather than waiving conditions in a rush to win.
Prices Hold, Growth Slows
Importantly, cooling activity has not meant falling prices. Benchmark values remain near records, but month-over-month growth has flattened. This distinction matters: a slowdown in the rate of appreciation is very different from a decline. For sellers, it means the exceptional gains of early 2021 may represent a plateau rather than a launchpad. For buyers, it offers a bit more breathing room without the relief of meaningfully lower prices.
Bank of Canada policy rate, 2015–2021
Year-end overnight target rate. Source: Bank of Canada.
Regional Divergence Emerges
As the national frenzy fades, regional differences are reasserting themselves. Some markets are cooling faster than others, and the recreational and small-town markets that boomed hardest are showing the most variable results. Urban condo markets, by contrast, are quietly strengthening as buyers return to city living and seek relative value. The uniform coast-to-coast surge of the winter is giving way to a more differentiated picture.
Inflation (CPI), 2015–2021
Annual average consumer price inflation. Source: Statistics Canada.
Why Local Data Matters More Now
In a cooling, diverging market, national headlines can mislead. A buyer in a rebounding urban condo market faces very different conditions than one in a softening cottage region. This is precisely when neighbourhood-level data earns its keep, allowing participants to understand the specific dynamics of their target market rather than reacting to averages. Our team remains focused on delivering that kind of granular, timely intelligence.
Verified · 2021
The Bank of Canada held its policy rate at the 0.25% effective lower bound throughout 2021, keeping mortgage rates near record lows into the year-end.
Looking Ahead
The summer is likely to bring the usual seasonal slowdown, layered on top of the broader cooling already underway. The open question is what the fall holds: whether the market settles into a more sustainable rhythm or whether pent-up demand and still-low rates reignite competition. We lean toward a market that stabilizes at elevated levels, but with rates and immigration both in flux, the path is unusually uncertain.
This analysis is built on Neighbourly.io — the real estate data API for Canada. Standardized addresses, boundaries, demographics, permits and market signals through a single interface.
Explore the data