November was widely expected to be a turning point for Canada’s housing market. After two consecutive interest rate cuts from the Bank of Canada, borrowing costs fell to levels many buyers had been waiting for.
Instead, new data shows home sales declined across most of the country, reinforcing the idea that lower rates alone are no longer enough to restart housing demand.
Rate Cuts Did Not Trigger a Sales Rebound
The Bank of Canada cut its overnight rate in both September and October, reducing variable mortgage rates by a combined 50 basis points. Variable rates briefly moved into the mid-3 percent range, with fixed rates also trending lower.
Despite this:
- National home sales fell 0.6 percent month over month in November
- Sales were down nearly 11 percent year over year
Historically, this level of rate relief would have driven a noticeable increase in buyer activity. November’s data suggests the market has moved beyond rate sensitivity alone.
Why Buyers Are Still Holding Back
Affordability constraints appear to be outweighing interest rate improvements.
Recent financial indicators show:
- Rising long-term credit delinquencies, particularly among younger Canadians
- Approximately 40 percent of Canadians reporting they were within $200 of missing monthly bills in October
For households already under pressure, qualifying for and committing to a long-term mortgage remains difficult, even at lower rates. Buyers facing credit stress are also less likely to qualify for the most competitive mortgage pricing.
Housing Market Likely Stuck Until Spring
With household finances strained, the housing market is showing signs of entering a holding pattern.
Improved borrowing costs have not been enough to offset:
- Elevated home prices
- High cost of living
- Tight mortgage qualification rules
Until financial conditions improve more broadly, meaningful recovery in sales activity may be delayed until spring 2026.
Provincial Sales Performance in November
Sales increased on a monthly basis in only three provinces:
- British Columbia
- Alberta
- Saskatchewan
Even in these markets, gains were modest. Notably, Alberta recorded more home sales than British Columbia, highlighting ongoing regional shifts.
Elsewhere, sales declines were relatively contained:
- Nova Scotia: -13 percent
- Prince Edward Island: -5.6 percent
- Newfoundland and Labrador: -2.7 percent
- New Brunswick: -2.6 percent
- Quebec: -2.5 percent
- Ontario: -1.5 percent
- Manitoba: -0.7 percent
Several provinces that posted strong gains earlier in 2025 now appear to be experiencing buyer fatigue.
Ontario Buyers Continue to Wait
Ontario remains one of the most cautious markets.
Sales continue to lag as buyers wait for clearer signals that prices have bottomed. However, further price declines may be limited. Sellers are increasingly resistant to additional cuts, and inventory remains uneven across regions.
Once buyers accept that current pricing represents the new baseline, activity could resume even without major price drops.
Home Prices Remain Resilient Across Most Markets
Despite slower sales, home prices have not collapsed.
Year-over-year benchmark price changes in November show:
- Greater Toronto Area: -5.9 percent
- Greater Vancouver: -3.9 percent
- Calgary: -3.4 percent
- Edmonton: +3.7 percent
- Winnipeg: +5.3 percent
- Montreal: +5.7 percent
- Halifax: +5.0 percent
Outside Ontario and British Columbia, price resilience remains a defining feature of the market.
What This Means for Ontario Buyers and Sellers
Buyers
- Lower rates alone are unlikely to unlock affordability
- Price declines may be limited from here
- Waiting for a major correction carries increasing risk
Sellers
- Pricing realistically matters more than timing
- Well-positioned homes continue to sell
- Deep discounts are becoming less common
Outlook Heading Into 2026
The Canadian housing market is no longer driven solely by interest rates. Household debt levels, credit stress, and affordability pressures are now the dominant forces shaping demand.
With prices holding steady in many regions and sales subdued, the market is likely to remain range-bound until household finances improve more meaningfully.
References
Canadian Real Estate Association. (2025). National housing market statistics. https://www.crea.ca
Bank of Canada. (2025). Policy interest rate announcements and monetary policy reports. https://www.bankofcanada.ca
Canadian Housing Market Update: December 2025 – NerdWallet Canada
Equifax Canada. (2025). Consumer credit trends report. https://www.consumer.equifax.ca
MNP Ltd. (2025). Consumer Debt Index. https://mnpdebt.ca
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