Canada’s condo supply is surging — and it’s not just in Toronto

Hopeful Canadian homebuyers may find themselves with plenty of options when it comes to condos in many housing markets across the country, according to a new report from Re/Max Canada.

In its national condo outlook released on Wednesday, the national brokerage noted that listings in this segment of the market have “soared” in recent months.

Toronto has seen a notable surplus of condos, with around seven months’ worth of inventory documented over the summer. Re/Max reported that condo listings in Toronto increased by 52.8 percent year-over-year as of August, but the city is not alone in this trend. B.C.’s Fraser Valley led the way with a 58.7 percent rise during the same period, while Calgary's inventory increased by 52.4 percent and Ottawa's by 44.5 percent.

Other cities included in the report, such as Edmonton, Halifax, and Vancouver, experienced annual gains ranging from 7.3 to 17.7 percent.

Re/Max suggested that condo sellers have entered the market in anticipation of a resurgence in buyer demand during the latter months of the year, partly due to expectations for more interest rate cuts from the Bank of Canada.

While housing affordability has seen slight improvements in some markets this year as mortgage rates decline, home prices have remained steady or even fallen amidst slower-than-usual sales activity. The condo market is particularly significant for first-time and sidelined homebuyers, as Re/Max pointed out that it serves as not only a “first step” into homeownership but increasingly a “middle step” in Canada’s most expensive housing markets.

In Toronto, the average condo price fell by two percent in the first eight months of the year compared to the same period in 2023. However, in other surveyed cities, Re/Max indicated that “values have held up surprisingly well” despite the influx of listings.

Calgary and Edmonton, both popular destinations for interprovincial migration, saw average condo prices rise by 15 and four percent year-over-year, respectively. Other markets in the report reported low single-digit increases in average values.

Edmonton's condo sales levels were up 37 percent annually in the first eight months of 2024, marking the city’s best performance in the past five years, according to Re/Max. The brokerage highlighted an increase in investor activity in Edmonton, which contrasts with the national trend.

In addition to local buyers attracted to Edmonton for its relative affordability, out-of-province investors also see potential opportunities in the city’s condo market. “Savvy investors in Edmonton have been actively revitalizing tired condominium stock and subsequently renting it out for top dollar,” the report noted.

Outside of seller markets in Alberta and other active neighborhoods, Re/Max Canada president Christopher Alexander described the current state of the condo market as “the calm before the storm.” He anticipates a busier spring in 2025, arguing that “aspiring condominium buyers” now have a brief window of less competition from investors amidst a growing supply in many markets.

“With values set to rise, this is arguably the most favorable climate for condominium buyers we have seen in recent years,” he stated.

While Re/Max contends that condo prices have bottomed out in Toronto, other experts predict that home values in the city's condo market may still decline further.

TD Bank economist Rishi Sondhi mentioned in a late September report that he expects a mid-to-high single-digit drop in Toronto’s average condo prices into early next year. “The relatively subdued sales recovery means that it will likely take several months to absorb these inventories, and further price concessions could be required to facilitate the process,” he wrote.

Additionally, an RBC housing forecast released on Wednesday estimated that Toronto condo prices have further declines ahead in the near term.