London Market Deep Dive

Still a Buyers' Market in London — But the Window Is Moving

The May 2026 numbers are in for the London and St. Thomas real estate market, and the headline is this: it's still a buyers' market, but the conditions that define it are slowly shifting. With 4.3 months of inventory — down from 4.5 in April — London technically remains in buyers' territory (balanced markets start around 3 months), but momentum is building in a way that buyers should pay attention to.

Home sales jumped 8.8% year-over-year to 776 transactions, the clearest sign yet that buyers who have been sitting on the sidelines since 2023 are starting to move. That increase in sales volume, combined with a drop in new listings of 9.1% compared to May 2025, means the inventory pool is being absorbed faster than it's being replenished. That math, sustained over a few more months, is how buyers' markets become balanced markets.

The average sale price for May came in at $662,292 — up 7.1% from April's $618,665. That month-over-month gain is actually the more encouraging story: it signals genuine momentum building through the spring, not just a statistical blip. The year-over-year gain of 1.0% is modest, but after a prolonged period of softness it represents a meaningful directional shift.

London Average Home Prices by Area — May 2026

Breaking it down by neighbourhood, the gap between London's areas remains wide. North London continues to command the highest prices in the city, while East London offers the most accessible entry point — and the most opportunity for patient buyers willing to look past the year-over-year decline.

South London's 4.4% year-over-year gain is worth noting — it's outperforming both the city average and the North end, reflecting sustained demand in neighbourhoods like Lambeth, Southdale, and White Oaks where families are finding strong value relative to the city's pricier quadrants. East London's 9.4% year-over-year decline, on the other hand, represents a real opportunity for first-time buyers and investors who have the patience to hold through the current cycle.

Looking Ahead

London Real Estate Outlook for Summer 2026

Summer real estate in London tends to be quieter than spring — but "quieter" doesn't mean slow. The buyers who are active in July and August are typically serious and motivated. Families want to be settled before school starts. People who've been watching the market since January are ready to move. That creates a quality-over-quantity dynamic that is actually quite favourable for both sides of a well-structured transaction.

With inventory still elevated and the Bank of Canada rate cycle continuing to evolve, conditions should remain buyer-friendly through the summer months. The risk for anyone waiting to buy is that the tightening trend we're already seeing — rising sales volumes, falling new listings — gradually chips away at that negotiating power. We are not in a rush situation yet, but the gap between today's buyers' market and a more balanced one is narrowing with each month's data.

Global uncertainty, ongoing trade pressures, and the broader economic picture haven't gone away — and they continue to influence buyer confidence in ways that show up in the data. But London's fundamentals remain strong: affordability relative to major urban centres, a diversifying local economy, and a consistent base of demand from families, young professionals, and people relocating from the GTA and Waterloo Region in search of value. That underlying story hasn't changed, and it won't change quickly.

Data sourced from LSTAR (London and St. Thomas Association of REALTORS®), TRREB, and the Cornerstone Association of REALTORS® (Waterloo Region). Statistics reflect May 2026 and are deemed reliable but not guaranteed.