The Canadian Real Estate Association (CREA) has adjusted its 2026 home sales forecast downward for the third time this year, as sales declined nationwide in September. 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 similar adjustments made in April and July.
The surge in oil prices since spring has led to an increase in bond yields and fixed mortgage rates, impacting the housing market, according to CREA. While there was a slight uptick in monthly activity over the summer, CREA’s senior economist Shaun Cathcart expects rising oil prices once again and concerns about potential interest rate hikes by the Bank of Canada to deter more potential homebuyers in the final months of the year.
Phil Soper, President and CEO of real estate company Royal LePage, echoes similar sentiments, noting that prospective homebuyers are cautious due to global uncertainties, including the unpredictable statements from Washington affecting financial decisions like home purchases.
September witnessed a decline in home sales, with a 2.3% drop compared to August and a 7.7% decrease compared to the same period last year. Additionally, newly listed properties decreased by 1.8% on a monthly basis. The average national home price stood at $666,538, marking a 1.6% decrease from the previous year.
Regional markets, particularly in Vancouver and Toronto, showed weakness in September, while once-hot markets in the Prairies, Quebec, and the East Coast are also experiencing a cooling trend. Looking ahead, CREA anticipates a rebound in home sales in 2027, with a projected increase of 4.4%, provided there are minimal rate adjustments by the Bank of Canada and increased borrower certainty regarding lending rates.