The Canadian Real Estate Association (CREA) has adjusted its forecast for home sales in 2026, noting a slight increase in the number of homes sold in June compared to the previous month. Rising oil prices led to inflation and speculation about potential interest rate hikes by the Bank of Canada, resulting in higher bond yields and increased fixed mortgage rates earlier this year.
Although these pressures have somewhat eased, CREA reports that they continued to impact the housing market along with a faster-than-expected decline in Canada’s population in recent months. The association stated that due to these factors, the national sales forecast for 2026 has been revised slightly lower, reflecting a weak start to the year and a delayed recovery in the housing market.
Initially predicting a modest rise in home sales for 2026, CREA now anticipates a 1.4% decrease compared to 2025. This revision follows a previous downgrade in April for the 2026 forecast. June data revealed a 0.5% increase in national home sales from the prior month, with monthly activity up by 0.9% compared to June 2025.
Shaun Cathcart, CREA’s senior economist, mentioned that this positive momentum in the market, starting in May, indicates a market that is gradually gaining stability. The MLS home price index reported a benchmark price of $657,700 for homes last month.
While prices in Ontario, B.C., and Alberta were still declining regionally, Cathcart noted that these decreases are diminishing, and overall prices across the country appear to be leveling off. Looking ahead, Cathcart forecasts a slight uptick in the Ontario and B.C. markets by the end of the year, while other regions like the Prairies and Quebec are experiencing a slowdown.
Cathcart emphasized that with home prices steadying and interest rates remaining relatively unchanged recently, there is potential for these conditions to motivate prospective buyers to enter the market.