Housing Outlook - Spring Housing Overview

Spring in Canada is a time for renewal and hope amid more sunshine and better weather, and that same optimism applies to the country’s housing market as well. But while economic uncertainty currently hovers over the spring rental and homebuying markets, the search for affordable housing in Canada remains THE primary focus for newcomers arriving in Canada.

Understanding the spring Canadian housing market helps newcomers find that first rental home and begin their journey to home ownership. And it all starts with picking the right city or region to call home. Knowing which Canadian housing markets are affordable and within your budget is the first step on the housing journey. This knowledge will steer you to housing success and home ownership in your new country.

Newcomers to Canada often ask why it’s so important to understand housing affordability and availability BEFORE arriving.

Here’s why: Picking the wrong city or region in which to settle leads to paying higher rents, which in the long run hurts your ability to save the money for home ownership. Settling in the wrong city can also eventually force you and your family to relocate to be able to afford to buy a home. Relocation can be painful and expensive, and means finding new jobs, friends, schools, or even separating from family.

The housing reality in Canada is that there is a direct connection between rent prices and home-buying prices. If rents are affordable in a city, so are home-buying prices.

Understanding this will help you make smarter choices BEFORE and WHEN you arrive. Always remember that in Canada, your housing cost of living (paying rent or a mortgage) is your biggest monthly expense. No other expense comes close.

That’s why selecting the right city in which to settle is so important to you and your family’s future in Canada.

Newcomers to Canada whose goal is to become a homeowner must pay attention to rental and home-buying housing market trends in the city where they plan to settle, advises Dave Frattini, Managing Partner of Destination Canada Information Inc. (Prepare for Canada and Rentals for Newcomers).

“The decision to land in a large city like Toronto or a smaller city such as Regina” said Frattini, “can have a big impact on a newcomer’s plans and ability to save for and eventually buy a house.”

Frattini also reminds newcomers that Canada’s settlement agencies play a key role in helping choose the right city for employment, rental housing and eventual home ownership.

Last year, a Leger study showed that 80% of newcomers to Canada since 2014 found after arriving that rents and house prices were more expensive than they had imagined.

Newcomers also discovered that finding their first permanent rental home took longer than they anticipated. This means that budgeting accurately for the cost of short-term rentals is essential.

The good news for newcomers so far in 2025 is that rental search times are falling. A survey from Rentals.ca shows that due to reductions in the number of international students and temporary foreign workers entering Canada, rental search times have shortened as more rental units are now available.

Still, even with improved vacancy rates, finding an AFFORDABLE rental within your budget can take time, so you need to be financially prepared and aware.

Registering for a Prepare for Canada webinar can help you plan for the realities of the Canadian housing market.

For most newcomers to Canada, owning a home is a key goal. So, if that is your dream, then choosing the right city in which to settle is an essential first step.

Picking the wrong city, region or province to settle can delay home ownership by years. Home prices in many Canadian cities rose significantly in recent years, and while they have fallen slightly in the past year (particularly in major cities such as Toronto and Vancouver), they are still much higher than 2019 levels.

According to a 2024 Angus Reid survey, newcomers have been hit hardest by Canada’s housing affordability challenges.

The Angus Reid survey found that 39% of newcomers living in Canada for less than 10 years have considered leaving their province because housing costs are too high.

Again, if home ownership is your goal, you must choose your Canadian destination carefully. You don’t want to be forced a few years after arriving into a painful and costly relocation in search of an affordable home to buy.

Despite affordability issues in larger markets such as the Greater Toronto Area and the Greater Vancouver Area, the Canadian rental market is increasingly a “renters market,” which is very good news for newcomers this spring.

Rent prices across the country continue to fall steadily in many Canadian cities, (including the popular but expensive landing spots of Toronto and Vancouver). The availability of rental units is also improving due to a significant reduction in immigration and the continuing completion of numerous rental property projects across the country.

The Canadian rental market has now seen five straight months of annual rent declines after experiencing 38 consecutive months of annual rent increases.

The drop in rent prices and rental demand is expected to continue this spring and into the summer, says rental housing expert Shaun Hildebrand of Urbanation.

Even with Canada in the midst of an unpredictable trade war with the U.S., Hildebrand predicts that reduced immigration and the continuing completion of new apartment construction will see rent prices weaken even more in the months ahead.

“This will result in improved affordability for renters,” said Hildebrand.

The spring outlook for newcomers to Canada looking for that first rental is better than it has been for over two years.

However, affordability in some popular destinations remains a rental housing challenge for newcomers to Canada arriving this spring.

Though rent prices continue to fall, they are still at record highs compared to a few years ago, and while vacancy rates are easing in most cities, they remain slightly below the normal range of 3 percent.

So, while the spring rental landscape for newcomers to Canada continues to improve, affordability challenges exist, which makes choosing the correct city to settle in critically important to your success.

In more good news for renters (and potential buyers) as rent prices fall, an increasing oversupply of condos—particularly in Toronto and Vancouver— are adding more rental properties to the market. This trend is also expected to continue through the spring and summer, so be sure check out the condo rental market.

Meanwhile, a few popular mid-sized cities, such as Saskatoon, Winnipeg and Halifax continue to experience rent price increases as more newcomers opt to settle there, mostly because of cheaper housing prices.

As the Canadian winter ended, rent prices nationally fell 4.8% year-over- year to $2,088 — the lowest level since July 2023. Again, that trend is forecast to continue through the spring and summer.

Cities in Western Canada and most of the East Coast cities are predicted to continue to feature the best rental bargains for newcomers over the spring months.

According to Rentals.ca’s most recent monthly surveys, western Canadian cities such as Fort McMurray, Regina, Saskatoon, Edmonton, and Winnipeg consistently have the cheapest rents in Canada.

Cities in British Columbia continue to be the most expensive in Canada for rent prices and that’s not expected to change during the spring.

Every month, rent prices in the Greater Toronto and Vancouver regions rank as the most expensive in Canada, featuring asking rents that are much higher than those in Western Canada and smaller cities across the country.

This rent price disparity is a permanent feature of the Canadian rental housing market and will likely remain unchanged for the foreseeable future. It’s a Canadian renting reality for newcomers.

This disparity in rent prices can be frustrating for newcomers looking for affordable housing in Canada’s large cities.

For example, according to recent Rentals.ca data, a one-bedroom apartment in Toronto rents for $2,359 monthly.

At the same time, a one-bedroom apartment in Saskatoon rents for $1,262.

That’s a rent price difference of $1,097 a month!

Here’s another example: The asking rent for two-bedroom apartment in Vancouver is $3,442, while a two-bedroom apartment in Hamilton is $2,082. That’s a difference of $1,360.

Those are big savings each month, particularly if your goal as a newcomer is home ownership.

Another Canadian rental reality is that the further you settle away from Canada’s major cities and most populated provinces (Ontario and B.C.), the less rent you’ll pay.

Ontario is still the most popular Canadian province with newcomers. The current disparity in the asking rent price for a one-bedroom between Windsor (Ontario’s most affordable mid-sized city) and Toronto is more than $800 a month.

And while housing is the single most significant cost of living item for newcomers, other savings besides rent in Canada’s mid-sized and smaller cities can be substantial. For example, insurance, repairs, goods and services can cost less. Also, Canada’s inflation rate was 1.9% heading into the spring season. Exactly what impact a trade war with the United States will have on inflation (and rent prices) going forward is uncertain, but no sizeable increase is forecast.

Regardless of spring inflation or rental price trends, there’s a rental affordability guideline for newcomers that doesn’t change: You should pay no more than between 30 to 35% of your monthly gross (before tax and other deductions) income on rent. However, according to Statistics Canada, in many Canadian cities, domestic and immigrant renters often pay more than 35% of their monthly income toward rent, with some paying as much as 50%.

This rental reality shows why affordability and choosing the right city are so crucial to a newcomer’s pre-arrival strategy.

Let’s suppose your gross pay as a newcomer is $4,500 a month. In that case, you should budget $1,575 a month as your rental housing costs, according to the 35 percent guideline. The city of Windsor, Ontario, where rent for a one-bedroom is around $1,550 a month, is affordable and fits that budget.

Toronto, where rent for a one-bedroom is just over $2,400 a month, DOES NOT fit your budget. You’d have to earn $6,800 monthly (or about $82,000 annually) to comfortably afford an average one-bedroom in downtown Toronto.

Here’s another housing reality for newcomers who aspire to home ownership and aren’t keen on having to relocate: Canadian cities with cheaper rents also have more affordable housing prices.

That’s a fact.

At the end of winter, the average price for a home in the Toronto region (where rent is $2,359 for a one-bedroom apartment) was $1,342,486 (with sales slumping badly and plenty of homes listed for sale).

The late winter average price for a home in Winnipeg (where rent for a one-bedroom is $1,426) is $394, 088.

That’s a difference of $948,398 in the cost of a home between Toronto and Winnipeg.

Spring is normally the season in Canada when home sales pickup significantly as buyers shake off the winter blues, get outside and start looking.

In January 2025, home sales the Canadian housing market fell 4.9% from December 2024.

The Canadian Real Estate Association (CREA) has predicted a 4.7% increase in average home prices in 2025 and expects the Canadian housing market to return to more balanced conditions.

CREA has based this prediction on continuing lower borrowing costs and mortgage rates, which have lured some potential buyers (a lot of them renters) into the housing market, which now has a larger supply of homes for sale.

Since June 2024, the Bank of Canada has cut its key interest rate seven times, from a high of 5 percent to 2.75 percent. Despite the trade war tensions with the U.S., most economists predict more cuts for the spring 2025. Canadian housing industry experts believe these interest rate cuts will lower mortgage rates further and thus drive more sales.

Canada’s national average home price dropped to $670,064 in January 2025. That’s a 1% decline from December 2024’s price of $676,640.

In January 2025, there were almost 136,000 homes listed for sale. That’s an increase of 12.7% from a year earlier.

While some housing experts still hope/believe home prices may rise in the spring due to pent up demand and lower interest rates, uncertainty clouds Canada’s home-buying market.

Most experts forecast modest price increases for the spring at best. However, many factors (trade relations with the U.S. tariffs, interest rates, inflation, possible recession the job market, etc.) could move spring price forecasts higher or lower.

What remains certain in Canada is that the housing journey for most newcomers involves renting, saving, and buying. And after several years, more than 70 percent become homeowners.

According to a survey by Ipsos Research, newcomers to Canada become homeowners quicker than ever.

• Many newcomers to Canada are homebuyers within the first five years of arriving.
• Immigrants to Canada are more focused on owning a home overall than non-newcomers.
• Among the newcomers living in Toronto, 49% now own homes after being here less than five years.

Even though Canada has reduced its permanent resident target from 500,000 to 395,000 in 2025, down to 380,00 in 2026, and set a target of 365,000 in 2027, competition for affordable rentals remains unchanged.

And though the number of international students and temporary foreign workers being admitted has been reduced, a still sizeable number of them will arrive in Canada this spring, all of them seeking affordable rental housing.

In most Canadian rental markets this spring, prices and availability will bend in favour of renters. Increasingly, anxious landlords are offering rental incentives and concessions such as two-months free rent, free WiFi, free utilities, flexible lease conditions, etc., in order to attract good, long-term tenants. Being able to politely and respectfully negotiate for cheaper rent is an important skill for newcomers to Canada in the spring of 2025.

Still, in order to get these incentives and affordable rents, it remains essential that you sell yourself as a good tenant to landlords.

To help you succeed in finding your first permanent Canadian rental, Prepare for Canada has created a guide that shows newcomers how to craft their rental application forms and listing inquiries so they can stand out to the landlord as an excellent tenant.

If finding a rental on your own feels overwhelming, other rental solutions for newcomers exist in Canada.

Newcomers can get ahead of the competition in finding their first rental by working with certified, experienced real estate agents. This no-cost solution sees the real estate agent find the rental for you. This option is attractive to qualified newcomers focused on finding a job or have arrived with one and are now too busy with work and family to look for a rental.

Another stress-free rental solution is home-sharing.

If you qualify as a housemate, you live with the homeowner in their home. Being a housemate is cheaper than being a roommate. It offers many more amenities (better housing, location, a knowledgeable, friendly host, security, etc.) and other advantages.

You can learn about these free options in by registering for a Prepare for Canada webinar

• Register for Prepare for Canada’s FREE Renting Your First Home In Canada webinar
• Follow Canadian news that affects housing, such as interest rates, inflation, job numbers and U.S.-Canada trade relations.
• Register for FREE for Rentals for Newcomers.
• Check rental listings on Rentals for Newcomers for landlords offering incentives.
• Discover all about home-sharing and how to become a housemate.
• Investigate using a real estate agent to find your rental for you.
• Download for FREE the Rentals for Newcomers Application Tips Guide.