Ontario Real Estate
Market Updates

The Ontario Real Estate Brief — Week of October 26, 2026

The Bank of Canada raised its policy rate by 25 basis points to 2.5% on October 28 — its first increase since July 2023 — citing higher, more persistent inflation tied to energy prices, and flagged that a further hike could be needed. This special update covers the decision and new Monetary Policy Report, TRREB's latest (September 2026) data showing buyers still in a holding pattern, what higher bond yields mean for fixed mortgages, a late-October/early-November home maintenance checklist, and the latest on GTA commercial vacancy.

Market snapshot

GTA Market — September 2026 (TRREB Data)

GTA REALTORS® reported 5,040 home sales in September 2026 — down 9.0% year-over-year from 5,540 — while new listings fell to 16,500, down 14.4% year-over-year. TRREB described buyers as being in a holding pattern, citing uncertainty about the economy, inflation and borrowing costs. TRREB's September data remains the latest release. On a seasonally adjusted basis, both sales and new listings declined from August, and TRREB's CIO noted substantial pent-up demand that needs confidence in jobs and inflation to be unlocked.

The average GTA selling price was $1,006,409, down 5.1% year-over-year from $1,060,036, while the MLS® HPI Composite benchmark was down 4.7% year-over-year. On a seasonally adjusted, month-over-month basis, the HPI Composite and the average price both edged lower. Average days on market (LDOM) rose to 34 in September from 33 a year earlier, while the average days for a property to sell including relisted properties (PDOM) held at 51.

Mortgage & bond yields

What the rate environment means for you

On October 28 the Bank of Canada raised its overnight rate by 25 basis points to 2.5% (Bank Rate 2.75%), its first hike since July 2023, after holding at 2.25% on September 2. The new Monetary Policy Report shows CPI inflation near 3% since April and expected to reach about 3.5% by year-end, averaging about 3% in 2027 before returning to 2% by mid-2028, with core inflation close to 2%. Canadian GDP is projected at about 1% in 2026 and 2% in 2027 and 2028, with growth expected to slow in Q4 on new U.S. tariffs, and unemployment has hovered near 6.5%. Governing Council said another increase could be needed but it will proceed carefully, one meeting at a time; the next decision is scheduled for December 9. The Canada 5-year bond yield, which anchors fixed mortgage pricing, was reported near 3.7% in early October (versus under 1% when many current renewals were originally signed), and the lowest insured 5-year fixed rate was about 4.34% on October 7 (Ratehub.ca). Post-decision yield and rate-sheet moves were not yet verified at the time of writing; variable-rate and prime-linked borrowers feel the hike directly, while fixed-rate pricing was already repricing higher.

Household debt insights

The debt picture — and what it means for buyers

Canadian household debt-to-income ratios remain among the highest in the developed world. Forced sellers are creating select buying opportunities, and lenders are applying more scrutiny than they have in a decade. Know your numbers before you sign.

Home maintenance tip

Late October / early November checklist — protect your investment

• ✓Replace your furnace filter and book an HVAC service now if you have not already, before the cold sets in
• ✓Clean gutters and downspouts once the leaves have come down, and make sure downspouts direct water away from the foundation
• ✓Check window and door weatherstripping and caulking to keep heating costs down
• ✓Drain and store outdoor hoses and shut off exterior water lines before the first frost; test smoke and CO alarms when the clocks change on November 1

Commercial market

Commercial pulse — industrial, office & retail

Toronto's downtown office market kept improving in Q3 2026: CBRE reports downtown vacancy fell 90 basis points quarter-over-quarter — the largest decline of any Canadian market — and Colliers put GTA-wide office vacancy at 10.4% after 860,000 sq. ft. of positive absorption, mostly in Class A buildings. On industrial, the latest verified GTA figures remain Q2 2026: vacancy of 4.9% (Cushman & Wakefield) with record absorption of 2.4 million sq. ft., 2.3 million sq. ft. above a year earlier; Q3 industrial figures were not yet available to confirm. Retail data has not been updated since the last brief; ground-floor demand remains supported by improving foot traffic (CBRE). These are the latest available figures.

Sources: Bank of Canada press release and Monetary Policy Report (October 28, 2026; hike to 2.5%; next decision December 9, 2026), as reported by CP24 and investingLive (October 28, 2026); TRREB Market Watch (September 2026, released October 6, 2026); 5-year Government of Canada bond yield and Ratehub.ca insured fixed rate (reported by Mortgage Professional Canada, October 7, 2026); CBRE Canada Office Figures (Q3 2026); Colliers Q3 2026 National Snapshot; Cushman & Wakefield Toronto Industrial MarketBeat (Q2 2026); CBRE Canadian Retail report (2026).