The Canadian Real Estate Association (CREA) has adjusted its 2026 home sales forecast for the third time this year, with September data indicating a decline in sales nationwide. Initially projecting a slight increase in home sales for 2026, CREA now anticipates a 5.2% decrease in home transactions compared to the previous year. This revision follows earlier downward adjustments made in April and July.
Rising oil prices since spring have caused bond yields and fixed mortgage rates to increase, which, according to CREA, has negatively impacted the housing market. While there was a slight uptick in monthly activity over the summer, CREA’s senior economist, Shaun Cathcart, believes that rising oil prices once again and concerns about potential interest rate hikes by the Bank of Canada to combat inflation will deter more prospective homebuyers from entering the market in the final months of the year.
Cathcart stated, “We’ve been on this roller-coaster for two years now,” referring to challenges posed by U.S. tariffs and escalating lending rates. He anticipates that uncertainties in the market will discourage many from engaging in real estate transactions this fall.
Royal LePage, a real estate company, echoes similar sentiments expressed by potential homebuyers. The firm’s President and CEO, Phil Soper, notes that the fall housing market has been softer than expected, with cautious buyers hesitant to make significant purchases amid global uncertainties.
Economic factors reflecting these sentiments are evident in the September sales figures reported by CREA. Home sales in September decreased by 2.3% compared to August and 7.7% compared to the same month last year. Additionally, the number of newly listed properties dropped by 1.8% on a month-over-month basis, continuing a trend of declining new supply since September 2025.
The national average home price stood at $666,538, down by 1.6% from the previous year. While markets in Vancouver and Toronto exhibited particular weakness in September, regions like the Prairies, Quebec, and the East Coast, which had previously experienced strong market activity, 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 that includes minimal rate adjustments by the Bank of Canada and increased borrower confidence in lending rates, CREA predicts a 4.4% increase in home sales for 2027.