In the years following the Canadian multi-family segment’s last cyclical peak, in 2022, the value premium of new condos in certain major markets has significantly eroded relative to resale units, creating potential risks for lenders’ portfolios as well as implications for future housing supply.
RPS has examined appraised values of units completed in the years of 2023, 2024, and 2025, respectively, in the provinces of Alberta, B.C., and Ontario. For each year, RPS compared these with the median value of all other appraised units (i.e. those more than one year old) to evaluate how new dwellings are performing against the broader market.
At the national level, which takes into account appraisals conducted across Canada, the median value of a new condo, including studios up to three-plus bedroom units, was $615,000 last year. That accounts for a +$85,000 premium over the median-valued resale condo, though the gap between the two has been rapidly narrowing. For instance, in 2024, the median value of a new condo exceeded the median resale value by +$145,000. Preliminary data for the first half of this year suggests that new and existing values are continuing to converge, albeit at a slower pace.
The national figure obscures the extent to which new condo values have eroded in the country’s biggest high-rise markets. In B.C. between 2023 and 2025, the new condo value gap shrunk from $103,000 to near parity with resale units last year, with both categories reaching a median value of approximately $680,000. Meanwhile, Ontario shifted from a gap of $45,000 to $27,000. New builds fell to a median value of $569,000.
As appraised values of new units depreciate more rapidly than those of existing units in B.C. and Ontario, the opposite is occurring in Alberta, which has elevated the national figure and obscures the divergent regional trends. The Alberta market saw the new-build premium increase from $84,000, in 2023, to $136,000 last year.
Alberta’s stronger pricing performance is a result of earlier sustained strength in the Edmonton and Calgary markets. These urban centres experienced some of the strongest value increases last year, according to the RPS House Price Index’s tracking of 13 major metro areas across Canada. Gains were driven in part by international and interprovincial migration. A tight labour market also supported housing demand. In fact, Alberta had the most robust job growth of any province other than Prince Edward Island in recent years. Over the 2022 to 2025 period, employment in the province surged by almost 10%.
Risks mounting in B.C. and OntarioRisks mounting in B.C. and Ontario
From an affordability perspective, the vanishing premium for new units in B.C. and Ontario is, of course, beneficial for homebuyers. It offers end users more choice on the market and the ability to move up, especially in Ontario, which recently introduced an HST rebate on new homes. However, the trend also has implications for lenders. Where the appraised value of new units does not fully reflect the price paid by purchasers, lenders may face greater uncertainty around collateral values and loan-to-value positions, particularly if market conditions soften.
In particular, new units today may have appraised values of upwards of $100,000 less than when the purchase agreement was signed several years prior. For example, new unsold units in the Greater Toronto and Hamilton Area are still priced at a hefty premium compared to the resale market. List prices for new and unsold units in the Greater Toronto and Hamilton Area remained 43% higher than average resale prices in Q2, according to Urbanation, which tracks pricing in the new development industry.
Although some units that transacted in Q2 are reported to have sold below advertised prices — particularly as developers become increasingly aggressive with incentives to move unsold inventory — those discounts may not have been available to buyers who entered into purchase agreements several years ago.
While lower values and discounts may encourage some buyers to purchase new units today, high levels of standing completed inventory have accumulated in the Lower Mainland and Southern Ontario. With developers holding thousands of unsold units and having greater difficulty achieving the pricing needed to support the economics of future projects, fewer new homes are entering the pipeline for construction. Already, the correlation is apparent in B.C. and Ontario. Housing starts are declining in the provinces where the price gap between new and existing units is narrowing. This has clear implications for lenders’ exposure to new development and for the future supply of housing.
Josh is a staff writer at RPS. He has been reporting on the national real estate market for 10 years, including for some of Canada’s largest newspapers and magazines.