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Distressed Deals Pile Up in Canada’s Once-Booming Housing Market

Prices are falling in some of the urban markets that had the biggest increases over the past two years. That’s leading to broken and renegotiated deals. 

Homes in the St. Andrew-Windfields neighbourhood of Toronto. Home values Canada’s largest city are declining at an unusually rapid clip — the average selling price is down nearly 9% in three months.

Homes in the St. Andrew-Windfields neighbourhood of Toronto. Home values Canada’s largest city are declining at an unusually rapid clip — the average selling price is down nearly 9% in three months.

Photographer: Cole Burston/Bloomberg

Zohal Habibi hadn’t even moved into her new home in the suburbs of Toronto when she started regretting the purchase. “We took a very bad decision,” she says.

It’s not about the house itself. She and her husband are excited about the extra space it’ll give them and their two young kids. The problem is the price they agreed to pay for the three-bedroom home in March: C$920,000 ($711,000).