Canada Housing Market

Canada’s housing market outlook has been downgraded again, with new projections suggesting both sales and prices could remain largely stagnant for the next several years.

The latest forecast from the Canadian Real Estate Association shows weaker-than-expected activity to start 2026, leading to significant revisions in both sales and price expectations.

Home Sales Forecast Slashed for 2026

CREA has reduced its expectations for a housing market recovery following a slow first quarter.

• 2026 home sales are now forecast to rise just 1.0% year-over-year
• Total projected sales: approximately 474,900 homes
• Previous forecast (January 2026): 5.0% growth

This means the expected increase amounts to fewer than 5,000 additional home sales compared to 2025.

Looking ahead:

• 2027 sales are forecast to rise 2.1%
• Down from a previous estimate of 3.5%

Provincial Outlook Shows Mixed Performance

The revised forecast shows uneven activity across the country.

Expected sales growth:

• Ontario: +2.6% (down from +8.5%)
• British Columbia: +2.4% (down from +8.3%)

Expected declines:

• Manitoba: -6.3%
• Nova Scotia: -3.0%
• Alberta: -2.2%
• Saskatchewan: -2.2%

This suggests that even as some markets stabilize, others are expected to weaken further.

Home Prices Expected to Remain Largely Flat

Price growth expectations have also been reduced.

• Average home price forecast: $688,955 in 2026
• Annual growth: +1.5%
• Previous forecast: +2.8%

This level of growth is below inflation, meaning real price gains remain negative.

CREA’s outlook suggests that:

• Home prices could remain near $700,000 through 2027
• Marking a potential 7-year period of minimal price movement

Ontario and BC Prices Barely Moving

Even in the country’s largest housing markets, price growth is expected to be minimal.

• Ontario: $835,467 average price (+0.1%)
• British Columbia: $956,248 average price (+0.3%)

These figures indicate that while prices are not falling sharply, they are also not increasing in a meaningful way.

Key Drivers Behind the Slowdown

CREA points to several factors contributing to the weaker outlook:

• Slower population growth compared to recent years
• Higher borrowing costs
• Reduced momentum from previous demand drivers

The report also notes that the factors that supported rapid growth in recent years are no longer driving the market.

Uncertainty Around a Recovery

While CREA continues to frame the outlook as a gradual recovery, the revised projections suggest a more prolonged period of stagnation.

Any potential improvement in market conditions will likely depend on:

• Interest rate changes
• Inflation trends
• Broader economic conditions

Until then, the housing market may continue to move sideways rather than experience a strong rebound.

What This Signals for Canada’s Housing Market

The latest forecast reinforces a growing narrative across Canada’s housing market.

Rather than a sharp crash or rapid recovery, the market appears to be entering a prolonged period of adjustment, with limited price growth and modest sales activity.

For buyers and sellers, this means:

• Market conditions may remain relatively balanced
• Price appreciation may be limited in the near term
• Timing the market will remain challenging

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References

Better Dwelling. Canadian Real Estate Industry Cuts Forecast, Prices To Stagnate 2 More Years – Better Dwelling

Canadian Real Estate Association. (2026, April). Housing market forecast update.