After years of runaway price growth, Canada’s housing market is undergoing a significant reset, and sales volume is leading the charge. From the country’s largest metro areas to smaller, secondary cities, the pace of buying and selling has dramatically reshaped the pricing landscape, revealing a tale of two very different markets. Zoocasa used data from the Canadian Real Estate Association to analyze home sales and price changes across Canada over the past three years.
Sales Plunge in Ontario and BC
Some of the most significant corrections in the housing market have occurred in Canada’s priciest regions, especially Ontario and British Columbia. Sales have significantly slowed in urban centers where prices surged during the pandemic. From 2022 to 2025, sales in the Greater Toronto Area dropped by an astonishing 55.6%. Kitchener-Waterloo saw a significant decrease of 58.5%. Other parts of Ontario also experienced notable drops, with Ottawa down 51.7% and Hamilton–Burlington declining by 50.9%. In British Columbia, Fraser Valley experienced a decline of 50.6%, while Calgary saw a reduction of 47.8%, and Greater Vancouver fell by 47.9%.
These sales declines might not be temporary if they indicate a broader shift in affordability. Higher interest rates and inflated home values have pushed many buyers out of the market, resulting in fewer offers for sellers and forcing home prices to decrease.
Interest Rates and Affordability: A One-Two Punch
Regions hit hardest by sales declines tend to have one thing in common: high home prices. Cities like Toronto, Fraser Valley, and Ottawa, where mortgage burdens are among the highest in the country, have proven especially sensitive to interest rate hikes. As borrowing costs surged, so did monthly payments, creating widespread buyer hesitation. In turn, sales froze, inventory built up, and prices began to soften. It’s a clear cause-and-effect cycle: the more expensive the market, the more fragile it becomes under financial pressure.
Bright Spots in Smaller Cities
While the big markets hit the brakes, smaller and more affordable regions saw a very different trend. In Quebec and Atlantic Canada, sales either held steady or even grew. Sherbrooke led with a 24.5% increase in sales, while Trois-Rivières (+5.8%) and Newfoundland & Labrador (+3.0%) also posted gains. Even in larger cities like Montreal, Quebec City, and Halifax, the declines in sales were modest, typically under 7%. This stability has helped support price growth. With average home prices still under $600,000, these markets attract first-time buyers, investors, and out-of-province movers looking for more bang for their buck.
The Rise of Secondary Markets
Secondary cities are now outperforming major metros in both sales and price appreciation. Saguenay, Sherbrooke, Gatineau, and Trois-Rivières have become increasingly popular, offering a more affordable entry point without sacrificing quality of life. In Atlantic Canada, even Saint John saw home prices rise by 32.3%, while Gatineau posted a 23.17% increase.
Driven by remote work flexibility, lifestyle preferences, and affordability, these cities are emerging as smart investment choices for homeowners and buyers seeking long-term value.
How Sales Volume Impacts Price
A clear pattern has emerged: fewer sales typically lead to softer prices. In high-cost regions like Toronto, Vancouver, and Calgary, the sharp decline in sales has reduced buyer competition. As a result, sellers are cutting prices or risk having their listings go unsold. For instance, in Hamilton-Burlington and Kitchener-Waterloo, significant drops in sales have been followed by some of the largest price corrections in the country, with decreases of 26.3% and 22.1%, respectively.
In contrast, markets with stable or growing sales, especially in Quebec, have seen prices increase. The Quebec CMA, for example, experienced a 49.47% rise in home values from 2022 to 2025, followed by Trois-Rivières at 45.64% and Saguenay at 43.85%. These trends highlight a fundamental rule of real estate: where demand remains strong, prices tend to rise.
Timing Matters: When Sales Drop, Prices Lag
Understanding the timing gap between sales and price changes is important. Sales tend to fall first, while prices are slower to adjust. Sellers are reluctant to reduce prices immediately, but downward pressure sets in as inventory builds and listings stagnate. This pattern has been especially evident in markets like Niagara, Fraser Valley, and Hamilton-Burlington, where early sales declines eventually led to steep price drops.
Where Prices Fell the Most Since 2022
From February 2022 to February 2025, the steepest declines in housing prices occurred in previously overheated urban markets, specifically in Ontario. These regions include Hamilton-Burlington, Kitchener-Waterloo, and the Niagara Region. These corrections represent a long-overdue adjustment following the unsustainable growth experienced during the pandemic years.
Where Opportunity Lies Right Now
For prospective buyers focused on long-term growth, provinces such as Quebec and those in Atlantic Canada are currently experiencing notable property appreciation and consistent demand. For those prioritizing affordability, select regions in Ontario and British Columbia, particularly Kitchener-Waterloo, Hamilton-Burlington, and Niagara, offer uncommon price reductions. However, buyers should remain mindful of continued market volatility in these areas.
Sales volume has become one of the most significant indicators of the direction of Canada’s housing market. As demand cools in previously popular regions and shifts towards more affordable options, the country’s real estate landscape is redefined in real time.
Planning your next move? Whether you’re eyeing opportunity in Ontario or growth in Atlantic Canada, our real estate experts can help you navigate today’s shifting market. Give us a call today to speak with an agent in your area and start planning your next real estate endeavor.
