The Canadian Real Estate Association (CREA) adjusted its forecast for home sales in 2026 downwards. However, recent data indicates a slight increase in the number of homes sold in June compared to the previous month. Inflation driven by high oil prices led to speculation about potential interest rate hikes by the Bank of Canada, causing bond yields to rise and fixed mortgage rates to jump earlier this year.
Though these pressures have eased somewhat, CREA notes that they still impacted the housing market in recent months, along with a faster-than-expected decline in Canada’s population. The association stated that due to a weak first half of the year and a delayed recovery in the housing market, the national sales forecast for 2026 was revised slightly lower than initially predicted.
Initially, CREA had anticipated a small rise in home sales for 2026, but now foresees a 1.4% decline compared to 2025. This adjustment marks another revision to the 2026 forecast, following a previous downgrade of predictions for the year. In June, national home sales saw a modest increase of 0.5% from the previous month, with monthly activity up by 0.9% compared to June 2025.
Shaun Cathcart, CREA’s senior economist, mentioned that this growth built on positive momentum that began in May, describing the market as still stabilizing. The MLS home price index showed a benchmark price of $657,700 for a home last month. While prices in Ontario, B.C., and Alberta remained lower, Cathcart noted that the declines are narrowing, indicating a stabilization of prices nationally.
Cathcart highlighted the shift in market behavior, with Ontario and B.C. anticipated to see slight increases by year-end while regions like the Prairies and Quebec are experiencing a slowdown. With home prices steadying and interest rates holding relatively steady, Cathcart suggested that these conditions might entice potential buyers to enter the market.