Buyers Are Back. Prices Aren't.
Photos by Pixasquare, Wade Gardner and Ranurte on Unsplash
Good Morning. GTA home sales jumped 7% year-over-year in April — the biggest annual gain in nine months. Buyers are back. Here's the catch: prices slid 4.9%, new listings dropped 9.3%, and the market TRREB called "tightening" is still one where sellers are losing ground. Activity is a leading indicator. Price stabilization is the lagging one.CREA drops its April national figures tomorrow (May 14) — the first full spring month under the current rate environment. Watch that number closely.
Top Story
Buyers Are Back. Prices Aren't.
April 2026 delivered the clearest demand signal of the year. TRREB reported 5,946 GTA sales — up 7% YoY and 6.1% month-over-month (seasonally adjusted). New listings fell 9.3% to 17,097, and active listings dropped 6.4% to 25,110 — sales grew faster than supply, which TRREB flagged as early evidence of neighbourhood-level competition returning.
Prices haven't followed yet. The average selling price was $1,051,969 — down 4.9% YoY — and the MLS HPI Composite fell 6.6%. The market is split: Ajax and Whitby averaged 21 days on market; King sat at 43. Downtown Toronto condos (1,054 sold, avg $665,507) are recovering in volume but still correcting on price. CREA's April national data drops tomorrow — after a narrowing trend of Jan -16.2%, Feb -8.1%, Mar -2.3%, a positive print would be a genuine turning point.
WHY IT MATTERS:
- More deals, lower values: Volume is up, but prices are still down 4.9% — per-transaction revenue hasn't recovered yet.
- List now: New listings are down 9.3% YoY. Sellers listing now face the least competition this spring has seen.
- Segment your advice: Durham Region freehold and downtown condo are in different risk environments. One qualifying rate doesn't fit both.
More deals, lower values: Volume is up, but prices are still down 4.9% — per-transaction revenue hasn't recovered yet.
List now: New listings are down 9.3% YoY. Sellers listing now face the least competition this spring has seen.
Segment your advice: Durham Region freehold and downtown condo are in different risk environments. One qualifying rate doesn't fit both.
Rest of the News
Condos May Have Hit the Floor
In April, 1,054 Toronto condo units sold — up 14.4% YoY — even as prices fell to ~$665,000, down 6.4%. Buyers exist at current prices. The Daniels Corporation noted its active pipeline has shrunk from 8-10 simultaneous projects to just four, meaning developer supply is genuinely contracting at the source. CBC News covered this shift on May 9, framing it as the first credible floor signal the downtown condo market has produced in over a year.
WHY IT MATTERS: Volume up 14.4% is the first real demand signal of 2026 for condos. For clients with condo exposure, the conversation shifts from "wait for a better deal" to "this may be the deal."
Cottage Country Is Correcting. Quietly.
Ontario's recreational property market is in its own correction cycle — and most realtors aren't talking about it. Waterfront prices dropped 5.2% nationally in 2025 to a median of $717,600. In core Ontario cottage markets — Muskoka, Parry Sound, Haliburton — sales came in at roughly 991 units by year-end 2025, down 12% year-over-year. Re/Max broker John Fincham told the Globe and Mail he expects prices to fall a further 8%, supply to rise 8%, and sales volume to drop 10–15% through 2026. One Muskoka property he listed was priced 32% below what the owner paid in 2021 — and didn't receive a single viewing. The driver is mortgage renewals: owners who bought at pandemic peaks are renewing into rates they can't absorb, and some will be forced to sell. Royal LePage forecasts the Ontario cottage median at $643,722 for 2026 — a modest +2% on average, but that masks steep divergence between sought-after lakefront and secondary locations.
Why It Matters
Renewal-forced sellers are creating motivated cottage inventory that buyers haven't seen since before 2020. If you have clients looking for recreational property, the window is open. If you have clients who own one and are renewing this year, call them before the bank does.
The Stress Test Clock Is Ticking
In late January 2026, OSFI left the mortgage stress test unchanged — the minimum qualifying rate (MQR) remains at 5.25% or contract rate +2%, whichever is higher. But the regulator simultaneously opened a six-month consultation on whether the LTI (loan-to-income) portfolio cap at 4.5x gross income should fully replace or work alongside the existing MQR. LTI limits have been live at the portfolio level for federally regulated lenders since fiscal 2025. OSFI superintendent Peter Routledge has publicly stated the current stress test "didn't stop a very substantial build-up in mortgages with very high loan-to-income ratios" — framing that signals genuine review, not routine consultation. The six-month window puts a decision in mid-2026.
WHY IT MATTERS: If OSFI replaces the MQR with a pure LTI model, qualifying power shifts — some borrowers gain, others face tighter caps regardless of rate. For brokers: model your client files under both scenarios now. The borrower who qualifies comfortably today may not qualify the same way in Q3.
New Rules Hit Investor Mortgages
OSFI's Capital Adequacy Requirements (CAR 2026) guideline took effect January 1, 2026 — and most investor clients haven't heard about it. The rule reclassifies mortgages as "Income-Producing Residential Real Estate" (IPRRE) when more than 50% of the qualifying income comes from the rental property itself. IPRRE-classified loans require banks to hold more capital, which translates to higher rates and tighter terms for the borrower. The stress test itself is unchanged, but investors with multiple properties will see their second, third, or fourth purchase priced differently by federally regulated lenders. OSFI confirmed rental income can still be used to qualify, but cannot be reused across multiple files to maintain standard residential classification.
WHY IT MATTERS: Investor clients who qualified easily on a second or third property last year may hit a rate premium this year — not because rates changed, but because their file now sits in a higher-capital bucket. Know which of your clients cross the 50% rental income threshold before they do.
Windsor-Essex — The Quiet Market Worth Watching
Benchmark: $574,900 ↓ 2.1% YoY (March 2026)
Windsor-Essex is one of the quietest stories in Ontario real estate right now — and potentially one of the most important ones over the next 18 months. The market is balanced: benchmark price $574,900, down just 2.1% YoY, months of inventory at 4.1, and sales up 6.8% YoY in March. Two structural catalysts are building: the Gordie Howe International Bridge is expected to open in 2026, establishing the Windsor-Detroit crossing as the busiest commercial land port of entry in North America, and the NextStar Energy EV battery plant — a $5 billion Stellantis-LG joint venture — is ramping operations. The Conference Board of Canada projects 2.8% GDP growth for the region through 2028.
For realtors and brokers, Windsor-Essex offers something rare in Ontario right now: a market with a price floor that isn't built on speculation, a structural employment catalyst on the horizon, and an entry point ($574,900 benchmark) that's $477,000 below the GTA average. It won't be quiet forever.
Quick Hits
- CREA April data drops May 14: CREA April data drops May 14 — YoY decline narrowing fast (Jan -16.2% → Feb -8.1% → Mar -2.3%). A positive print would be the first national YoY gain since the oil shock.
- CMHC April starts land May 15: CMHC April starts land May 15 — two consecutive weak trend readings would confirm the construction slowdown is structural, not seasonal.
- Vancouver near a 5-year price low: Vancouver near a 5-year price low — GVREB reported April benchmark prices approaching a 5-year low. Ontario and B.C. lead the national correction; Alberta, Saskatchewan, and Newfoundland are still posting gains.
- InterRent REIT CEO steps down —: InterRent REIT CEO steps down — Brad Cutsey resigned as the REIT advances a friendly takeover by Carriage Hill Properties. COO Dave Nevins named interim CEO.
- CREA April data drops May 14: CREA April data drops May 14 — YoY decline narrowing fast (Jan -16.2% → Feb -8.1% → Mar -2.3%). A positive print would be the first national YoY gain since the oil shock.
- CMHC April starts land May 15: CMHC April starts land May 15 — two consecutive weak trend readings would confirm the construction slowdown is structural, not seasonal.
- Vancouver near a 5-year price low: Vancouver near a 5-year price low — GVREB reported April benchmark prices approaching a 5-year low. Ontario and B.C. lead the national correction; Alberta, Saskatchewan, and Newfoundland are still posting gains.
- InterRent REIT CEO steps down —: InterRent REIT CEO steps down — Brad Cutsey resigned as the REIT advances a friendly takeover by Carriage Hill Properties. COO Dave Nevins named interim CEO.
Tip of the Week
️ Tip of the Week
CMHC publishes a free quarterly Housing Market Outlook covering national and city-level supply, demand, starts, and price forecasts.
CMHC publishes a free quarterly Housing Market Outlook covering national and city-level supply, demand, starts, and price forecasts. If you're advising clients on Windsor-Essex, new construction timelines, or any market outside the GTA, this is where the supply-side story is told in plain numbers. Most realtors and brokers never open it. The ones who do walk into client conversations with a 12-month view nobody else in the room has.
Demand is back. Supply is retreating. Prices are the last thing to move — and they always are. Tomorrow's CREA release and Thursday's housing starts will tell us whether this spring has legs. We'll have both next week. See you next Tuesday. Answer: C — Ontario is the only province CMHC expects to see an outright home price decline in 2026. Every other province is forecast flat or positive.
See you next Tuesday.
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