Sep 28, 2026
If you bought a home in Toronto or Vancouver near the 2022 peak, a new global ranking confirms what your neighbourhood listings may already be telling you.
Swiss wealth giant UBS found that once you factor in inflation, home prices in both cities tumbled nearly 10% this past year — ranking dead last among 23 global real estate hubs. Meanwhile, prices in Seoul, Lisbon, Madrid and Hong Kong rose about 10%.
Advertisement
Toronto is actually a disorienting case of whiplash. After riding the highest streak in the UBS index from 2014 to 2022, prices have plummeted about 30% from their record high. Meanwhile, Vancouver prices are down roughly 20% from 2022, and actual home sales have crashed to a 25-year low.
Thanks for subscribing!
The best of Money.ca delivered weekly.
By signing up, you accept Money.ca Terms of Use, Subscription Agreement, and Privacy Policy.
Here’s what those numbers mean whether you own, want to buy or rent — and what to do next.
Why are Toronto and Vancouver home prices falling?
UBS points to three forces: Ottawa’s ban on foreign homebuyers, a glut of housing supply and higher interest rates. Both cities now sit in the “moderate” bubble risk category, putting them in the same boat as other major international hubs like Los Angeles, Sydney and Singapore.
UBS defines a bubble as significant, sustained overvaluation that typically only becomes obvious after prices correct. That lower risk rating shows that Toronto and Vancouver prices aren’t at extreme levels anymore — but don’t mistake it for a sign that a market rebound is on the horizon.
TRREB data shows the correction is continuing: the GTA composite benchmark price fell 4.5% year-over-year in August 2026. The average selling price was $993,410, down from an all-property-type peak of $1,334,544 in February 2022.
Borrowing costs aren’t offering much relief, either. The Bank of Canada held its key interest rate steady at 2.25% on September 2, 2026, but cautioned that financial conditions are tightening — partly because rising long-term bond yields are pushing fixed mortgage rates higher. Its next decision will be unveiled on October 28, 2026.
Must Read
- Are you paying too much for car insurance? Here are 3 clever ways to slash your monthly bill
- Here are 5 'must-haves' that Canadians constantly overpay for. How many of these are sabotaging your budget every single month?
- Here are the 5 biggest differences between rich and poor Canadians — which side do you fall on?
Join 19,000+ readers and get Money.ca’s best stories and exclusive interviews first — clear insights curated and delivered weekly. Subscribe now.
Does a lower home value cost you money?
Not unless you have to sell or borrow against it. Let’s assume a buyer paid $1,334,544, the February 2022 average, for a GTA home. Against TRREB’s August average of $993,410, that’s a gap of about $341,000. Averages mix property types, so this isn’t an apples-to-apples comparison, but it shows the scale of the shift.
If you plan on staying put and can handle your mortgage payments, that drop in value is just a loss on paper — it won’t affect your daily cash flow. It becomes real when you:
Advertisement
- Sell on a deadline, such as relocating, separating or downsizing
- Refinance or apply for a home equity line of credit (HELOC), as lenders set limits based on today’s value
- Switch lenders at renewal, when a new appraisal may show less equity than you expect
If you recently purchased a home with the smallest down payment allowed, you’re carrying the most risk. It doesn’t take much of a price dip to completely wipe out your equity.
Who’s most at risk — and who could benefit?
Condo investors
Rental income isn’t cushioning the drop. According to TRREB, average rents for one- and two-bedroom apartments slid about 2% this past spring, settling at $2,273 and $3,013 a month, respectively. Investors who bought at 2022 prices may be carrying negative cash flow.
First-time buyers and renters
Here’s where opportunity lies. Marco Pedri, a real estate broker with Shoreline Realty, told CTV News that for people buying a home to live in, “this may be an opportunity to actually secure something.”
While local housing costs still feel steep, UBS notes that Toronto remains far more accessible than its international peers. Buying a 650-square-foot unit in the city takes less than five years of a skilled worker’s average pay, which is a bargain compared to the 11 years required in London or the 15 years in Hong Kong.
One wildcard: the federal foreign buyer ban is set to expire on January 1, 2027, unless Ottawa extends it. Lifting it would spark a big rebound, given today’s rental returns and regulations.
What should Canadians do now?
- Mark your renewal date and start comparing offers a few months before your mortgage term expires
- Get a realistic valuation based on recent nearby sales before planning a refinance or HELOC draw
- If you’re buying a home, use your leverage in this market to negotiate on price and keep financing and inspection conditions
- Make the most of tax-advantaged down payment tools such as the First Home Savings Account (FHSA) and the Registered Retirement Savings Plan (RRSP) Home Buyers’ Plan
- If you’re looking at a home as an investor, rerun your numbers using today’s rents and stress-test them against a higher rate at renewal
Ultimately, worrying about your home’s 2022 valuation misses the point. The question that actually matters is whether you’ll need that equity over the next few years. If you don’t, your job is simply protecting your monthly cash flow. If you do, make sure your financial plans align with where prices sit today, rather than the peak market you bought into.
You May Also Like
- This 7-step plan from Dave Ramsey is designed to help you ditch debt, save more and build wealth — here’s how it works
- Prioritize these 4 critical investments and watch your net worth skyrocket
- Here are 8 solid money moves that could free up real cash every month — here's where to start
- Millionaires under 43 are reshaping investing — just 25% of their portfolios are in stocks. Here’s where their money is going
The most expensive financial mistakes are often the ones you don't see coming. Join 19,000+ Canadians who get the money moves, risks and opportunities shaping their finances — delivered free each week. Subscribe now.
Amy Tokic is an SEO content editor for Money.ca. She holds a B.A. in Communications from the University of Windsor. Amy is an award-winning author and has been writing professionally for 15 years, publishing articles in the lifestyle and health sectors.
