The Canadian Real Estate Association (CREA) has adjusted its 2026 home sales forecast downward for the third time this year as September data reveals 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 last year. This revision follows earlier downward 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 market negatively, as stated by CREA. While there was a slight uptick in monthly activity over the summer, CREA’s senior economist, Shaun Cathcart, believes rising oil prices and concerns about potential interest rate hikes by the Bank of Canada to combat inflation will likely deter more potential homebuyers in the remaining months of the year.
Cathcart described the current situation as a roller-coaster ride due to challenges posed by U.S. tariffs and rising lending rates, with uncertainties leading many to hesitate in entering the market this fall.
Real estate firm Royal LePage echoes similar sentiments, noting a softer-than-expected fall housing market as cautious buyers remain wary of significant investments amid global uncertainties. President and CEO Phil Soper attributes this caution to the unpredictable language coming from Washington affecting people’s financial decisions.
Recent data from CREA shows a decline in September home sales figures, with a 2.3% decrease from August and a 7.7% drop compared to September of the previous year. Additionally, the number of newly listed properties decreased by 1.8% on a monthly basis, continuing a trend of declining new supply since September 2025.
The average national home price stands at $666,538, marking a 1.6% decline from the previous year. While markets in Vancouver and Toronto experienced weakness in September, regions like the Prairies, Quebec, and the East Coast, previously strong markets, are also showing signs of cooling off.
Despite the downward revision in the current forecast, CREA anticipates a rebound in home sales next year. With an optimistic outlook of minimal rate adjustments by the Bank of Canada and increased borrower certainty on lending rates, CREA forecasts a 4.4% increase in home sales for 2027.
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