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The Canadian Real Estate Association (CREA) has revised down its projection for 2026 home sales again, while monthly data shows sales across Canada fell in September.
CREA previously expected home sales to tick up slightly in 2026, but now expects 5.2 per cent fewer homes will change hands this year compared to last. The adjustment follows similar downward revisions in April and July.
Oil prices have soared since the spring, which had a knock-on effect on bond yields and thus fixed mortgage rates, which CREA says weighed on the market.
While monthly activity ticked up slightly over the summer, CREA senior economist Shaun Cathcart says once-again rising oil costs and growing anxieties that the Bank of Canada will have to raise interest rates to combat inflation are expected to keep more potential homebuyers on the sidelines in the last months of the year.
“We’ve been on this roller-coaster for two years now,” Cathcart said, referring to hurdles presented by U.S. tariffs and rising lending rates. “Now it’s the uncertainty, and I think a lot of people are going to resist jumping in this fall because of that.”
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Real estate company Royal LePage says it’s hearing the same message from potential homebuyers. President and CEO Phil Soper says the fall housing market has proven softer than expected as prospective buyers remain cautious about making such a massive purchase amid so much global uncertainty.
“The chaotic nature of language coming out of Washington is directly impacting people’s willingness to make large financial decisions like buying a home,” said Soper.
September home sales slide
Those economic factors were already showing up in more sluggish September sales figures, according to the CREA.
Home sales for the month were down 2.3 per cent compared to August, and down 7.7 per cent compared to September of last year.
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The number of newly listed properties also fell by 1.8 per cent on a month-over-month basis. New supply has generally been falling since September 2025, according to CREA.
The average home price across the country was $666,538, also down compared to a year before, by 1.6 per cent.
On a regional basis, Cathcart says markets in Vancouver and Toronto were particularly weak in September. But markets in the Prairies, Quebec and on the East Coast — which have been hot for quite some time now — have started to cool off, too.
“Now everyone’s going to have to take a breather, I think, until we find out what interests are going to do next year,” Cathcart said.
Despite the downgrade in the forecast, CREA is predicting that home sales will pick up next year. Based on an optimistic outlook where the Bank of Canada makes limited rate changes and borrowers get more certainty about lending rates, CREA predicts home sales will tick up by 4.4 per cent in 2027.
