Canada Housing Market

Canada’s housing market may finally be gaining momentum after a sluggish start to 2026.

New data from the Canadian Real Estate Association (CREA) shows national home sales jumped 5.5% between April and May, marking the strongest month-over-month increase so far this year. The rebound comes after months of weak activity that left many wondering whether lower interest rates would be enough to bring buyers back into the market.

While home sales are improving, home prices remain below year-ago levels, suggesting Canada’s housing market is still working through a period of adjustment.

Canadian Home Sales Posted Their Biggest Gain Of 2026

According to CREA, home sales recorded through Canadian MLS® systems rose 5.5% month-over-month in May.

The increase was broad-based across the country but was led by Ontario, where activity picked up significantly after a slow start to the spring market.

CREA Senior Economist Shaun Cathcart said the market’s improvement may indicate that buyers and sellers are beginning to find common ground after a period of uncertainty.

The increase in sales also comes as housing affordability has improved somewhat compared to recent years due to lower borrowing costs and softer home prices.

New Listings Declined While Sales Increased

At the same time sales were rising, the number of newly listed properties fell 1% month-over-month.

As a result, Canada’s sales-to-new listings ratio climbed to 49.2% in May, up from 46.2% in April.

The long-term average sits at 54.8%, meaning Canada’s housing market remains close to balanced conditions overall.

A higher sales-to-new listings ratio generally indicates that demand is improving relative to supply.

Home Prices May Be Starting To Stabilize

One of the more notable findings from CREA’s report is that home prices appear to be stabilizing after months of declines.

The National Composite MLS® Home Price Index slipped just 0.1% in May compared to April. Excluding April’s reading, it was the smallest monthly decline since January 2025.

On an annual basis, the Home Price Index remained down 4.1%, although CREA noted this was the smallest year-over-year decline recorded so far in 2026.

The data suggests price declines may be slowing as market conditions gradually improve.

Canada’s Average Home Price Climbed Above $700,000 Again

Despite weakness in the Home Price Index, Canada’s national average home price continued to move higher.

The average sale price reached $702,079 in May, up 1.5% from the same month last year.

It was the first time the national average home price surpassed $700,000 in nearly two years and the highest monthly average recorded since 2024.

Regional differences remain significant, however. Home prices continue to face pressure in Ontario, British Columbia, and Alberta, while some other provinces have posted annual gains.

Is The Housing Market Recovery Finally Beginning?

The latest numbers suggest Canada’s housing market may be entering a new phase after a delayed spring season.

Inventory remains near historical averages at 4.8 months of supply, while sales activity is beginning to improve and price declines are slowing.

While it remains too early to call it a full recovery, May’s data represents one of the strongest signs yet that buyers are slowly returning to the market.

With June typically one of the busiest months of the year for Canadian real estate, the coming weeks may provide a clearer picture of whether this rebound has staying power.

References

Canadian Real Estate Association. (2026, June 16). Canadian home sales jump following slower spring start: Monthly housing market report. CREA. https://creastats.crea.ca

Canadian Real Estate Association. (2026). National residential statistics, May 2026. CREA. https://creastats.crea.ca