The Canadian Real Estate Association (CREA) has adjusted its 2026 home sales forecast downward once more, with September data indicating a decline in sales nationwide. Initially anticipating a slight increase in home sales for 2026, CREA now projects a 5.2% decrease in home transactions compared to the previous year. This revision follows earlier downward adjustments made in April and July.
The surge in oil prices since spring has had a ripple effect on bond yields, leading to increased fixed mortgage rates, which, according to CREA, have impacted the housing market. Despite a slight uptick in monthly activity over the summer, CREA’s senior economist Shaun Cathcart highlights the rising oil prices and concerns about potential interest rate hikes by the Bank of Canada to combat inflation as factors likely to deter more prospective homebuyers in the remaining months of the year.
Cathcart noted the ongoing challenges faced by the market due to U.S. tariffs and rising lending rates, expressing that uncertainty may lead many individuals to delay home purchases this fall. Real estate firm Royal LePage echoes similar sentiments, with President and CEO Phil Soper indicating a softer-than-anticipated fall housing market as buyers exercise caution amid global uncertainties.
September witnessed a decline in home sales, with figures down by 2.3% compared to August and 7.7% year-over-year. Moreover, newly listed properties decreased by 1.8% on a monthly basis, continuing a trend of declining new supply since September 2025, as reported by CREA. The national average home price stood at $666,538, reflecting a 1.6% decrease from the previous year.
While markets in Vancouver and Toronto exhibited notable weakness in September, regions such as the Prairies, Quebec, and the East Coast, which have experienced significant activity, are also showing signs of cooling. Looking ahead, CREA anticipates a rebound in home sales in 2027 under the assumption of minimal rate adjustments by the Bank of Canada and increased borrower confidence in lending rates, projecting a 4.4% rise in home sales next year.