Canadian Home Sales Down 6.9 Percent Year-Over-Year, as Economic Challenges Expected to Weigh on Market Momentum: Report

Home sales in August fell 6.9 percent in Canada from a year earlier, as economic headwinds are expected to weaken housing market momentum for the rest of 2026, the Canadian Real Estate Association says.

Home sales and price trends had remained mostly unchanged for four months in a row, but housing prospects are dampened by a Bank of Canada warning on inflation and doubts about sustained economic growth, senior economist Shaun Cathcart said.

“For borrowers, fixed mortgage rates have already increased on higher bond yields. Meanwhile, on the variable rate side, a rate hike is not only back on the table for this year but already priced in by markets,” he said.

August sales declined 0.7 percent compared with July, as newly listed properties increased by 3.3 percent month-over-month, the association said.

The increase in new listings gives buyers the “usual seasonal burst of new properties to choose from,” association chair Garry Bhaura said, though they must also navigate “a fresh round of economic uncertainty.”

The Multiple Listing Service (MLS) Home Price Index also showed a decline in home prices of 3 percent year-on-year in August, while the seasonally unadjusted national average of home prices grew 0.6 percent compared with August 2025 to $668,219.

The association says it uses the MLS Home Price Index to provide a more accurate overall picture of real estate price trends than national averages, as it controls for property types rather than just averaging overall transaction prices.

“CREA cautions that average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighbourhoods or account for price differential between geographic areas,” it said.

The association said there were just under 200,000 properties listed for sale nationally at the end of August, 1.4 percent more than a year earlier and in line with the historical average for that time of year. Inventory has remained at 4.8 months’ supply for four consecutive months, it said.

With the sales-to-new-listings ratio easing to 49.1 percent and inventory holding at 4.8 months, the association said it considers the overall market to be firmly in “balanced” territory rather than leaning heavily toward buyers or sellers.