The Canadian Real Estate Association (CREA) has adjusted its forecast for home sales for 2026 downwards. However, recent data indicates a slight increase in the number of homes sold in June compared to the previous month.
Rising oil prices have contributed to inflation and raised the possibility of the Bank of Canada increasing interest rates. This led to an uptick in bond yields and a jump in fixed mortgage rates earlier this year. While these pressures have somewhat eased, CREA highlights that they continued to impact the housing market in recent months, along with a faster-than-expected decline in Canada’s population.
As a result of these factors, CREA has revised its national sales forecast for 2026 slightly lower due to a weak first half of the year and a delayed start to the anticipated housing market recovery. Previously anticipating a small increase in home sales for 2026, CREA now expects a 1.4% decline compared to 2025, marking another adjustment to its forecast for the year.
June data revealed a 0.5% increase in national home sales from the previous month, with a 0.9% rise compared to June 2025. Shaun Cathcart, CREA’s senior economist, noted that this uptick built on positive momentum starting in May, describing the market as still finding its footing.
The MLS home price index showed the benchmark price of a home at $657,700 last month. While prices in Ontario, B.C., and Alberta remained lower, Cathcart mentioned that these declines were narrowing, and prices nationwide appeared to be stabilizing.
Cathcart pointed out that over the past four years, Ontario and B.C. experienced cooler markets, while other regions were hotter. Looking ahead, Ontario and B.C. are expected to see a slight uptick by year-end, with regions like the Prairies and Quebec beginning to witness a slowdown in market activity.
With home prices stabilizing and interest rates remaining relatively unchanged recently, Cathcart suggested that these conditions could motivate potential buyers to enter the market.
