Canada’s housing market is showing encouraging signs of recovery, with affordability improving in many major cities and home buyers gradually returning to the market.
According to RBC’s latest Housing Affordability Report for the first quarter of 2026, the bank’s national housing affordability measure fell by 1.4 percentage points to 53%, its best level in four years. Since a lower affordability measure indicates improved affordability, this marks positive progress for Canadians looking to purchase a home.
Affordability Improves Across Most Major Markets
Some of Canada’s most expensive housing markets saw the largest gains in affordability.
Vancouver and Toronto recorded the biggest improvements, although they continue to rank as Canada’s least affordable cities for home ownership. Lower home prices and reduced borrowing costs have helped make purchasing a home more attainable than it has been in recent years.
Not every market experienced the same trend. Montreal, Quebec City, and St. John’s saw home ownership costs increase during the quarter, highlighting the importance of understanding local market conditions.
Home Sales Are Starting to Increase
Improving affordability is also encouraging more buyers to re-enter the market.
As mortgage costs have eased and home prices have stabilized in many regions, home sales have begun to trend upward, signalling renewed confidence among buyers. Many prospective homeowners who had been waiting on the sidelines are taking advantage of improved affordability and increased inventory, leading to stronger market activity compared with previous months.
While sales are picking up, market conditions remain balanced in many areas, giving buyers more options and greater negotiating power than they experienced during the peak of the market.
Condominiums Continue to Lead the Way
Condominiums remain one of the most affordable paths to home ownership.
The national condo affordability measure dropped to 35.2%, placing it within one percentage point of its per-pandemic level. In several Canadian markets, condo affordability has already returned to—or even improved beyond—where it stood before 2020.
For first-time buyers and investors alike, condos continue to offer an attractive opportunity to enter the housing market.
Looking Ahead
While affordability is improving, RBC cautions that future gains may become more modest. Home price declines are beginning to level off, and interest rates have likely reached their cyclical lows, meaning mortgage costs may not fall much further.
Even so, today’s market presents a much stronger buying environment than Canadians have seen in several years. Improving affordability, rising sales activity, and a more balanced market are all signs that confidence is gradually returning to the housing sector.
Final Thoughts
Canada’s housing market continues to move in a positive direction. With affordability improving, condo ownership becoming more accessible, and home sales beginning to rise, many buyers are finding opportunities that weren’t available just a year ago.
Whether you’re a first-time buyer, an investor, or considering your next move, staying informed about local market trends will help you make confident real estate decisions in an evolving market.