Introduction to Canada’s Housing Market in 2026
As 2026 begins, Canada’s housing market appears to be finding its balance after several turbulent years. Rate cuts over the past year have eased some of the pressure on borrowers and helped stabilize sales activity, particularly in markets that cooled the most during the downturn. At the same time, price growth has remained relatively contained, reflecting ongoing affordability challenges and limited supply.
Real Estate Market Forecasts
Looking ahead, most forecasters expect the recovery to continue, but at a measured pace. While lower borrowing costs should support demand, higher household debt loads, renewal pressures, and uneven regional conditions are expected to keep the market from overheating.
The Canadian Real Estate Association (CREA)
- 2026 home sales forecast: 509,479 (+7.7% year-over-year)
- Commentary: “Since March 2025, home sales activity has been on a steady upward climb,” CREA said, adding that demand was “delayed and dampened, but not derailed.”
- 2026 home price forecast: $698,622 (+3.2%)
- Source
Royal LePage
- 2026 house price forecast by Q4: $823,016 (+1% year-over-year)
- Commentary: “Solid market fundamentals – including lower interest rates, increased supply, and reduced competition – have created a more favourable environment for consumers,” said Phil Soper, president and chief executive officer, Royal LePage.
- Source
Re/Max
- 2026 national average price outlook: -3.7% year-over-year
- 2026 national home sales outlook: +3.4% year-over-year
- Commentary: “Amid looming economic clouds, Canadians are maintaining their interest in homeownership,” said Don Kottick, president of RE/MAX Canada.
- Source
RBC Economics
- 2026 home resales forecast by Q4: 502,300 (+6.7% year-over-year)
- 2026 home price forecast by Q4: $812,700 (-0.9%)
- Commentary: “With the central bank signalling it’s done this cycle, it could be the hint some buyers were waiting for to make a move,” wrote economist Robert Hogue.
- Source
TD Economics
- 2026 home price growth forecast: +4.1%
- Commentary: “Canadian average home price growth was quite muted in November, and we think it will continue to grow at a sub-trend pace in coming quarters, weighed down by loose supply/demand balances in B.C. and Ontario,” wrote Rishi Sondhi.
- Source
2026 Interest Rate Forecasts
As we look ahead to 2026, the focus has shifted from how quickly the Bank of Canada might cut rates to how long it will remain on hold, and when the next move could eventually be higher. Most major banks expect the overnight rate to sit at 2.25% through much of 2026, reflecting a central bank that is broadly comfortable with inflation progress but cautious about declaring victory.
The implication for borrowers is a more stable, but not permanently lower, rate environment. Variable-rate relief appears largely behind us, with the next phase likely defined by an extended hold rather than further cuts. Fixed mortgage rates may also face upward pressure over time as markets begin to price in the possibility of future tightening.
Conclusion
In conclusion, the Canadian housing market is expected to experience a moderate recovery in 2026, with most forecasters predicting a steady increase in home sales and contained price growth. The interest rate environment is anticipated to remain stable, with the Bank of Canada likely to keep rates on hold for most of the year. As the economic cycle matures, there is growing discussion around the possibility of future rate hikes, which could impact the housing market. Overall, 2026 is shaping up to be a year of cautious optimism for the Canadian housing market.
