Canadian Housing Market Rebalances in July 2026

Canada’s housing market continued to improve in July, with sales rising, new listings falling, and home prices posting their first monthly increase in nearly two years.

The bigger story, however, is balance. Many Canadian markets are moving away from buyer- or seller-dominated conditions and toward a more normal environment.

Key Takeaways

• Home sales increased 0.5% month-over-month, the fourth consecutive monthly gain.
• New listings fell 1.6%, the third straight monthly decline.
• The sales-to-new-listings ratio reached 51.3%, within balanced-market territory.
• Canada had 4.7 months of inventory, slightly below its long-term average.
• The MLS® Home Price Index increased 0.1%, its first monthly gain since November 2024.
• Prices were still 3.3% lower than July 2025.

What Does a More Balanced Market Mean?

CREA generally considers a sales-to-new-listings ratio between 45% and 65% consistent with a balanced housing market.

July’s 51.3% reading suggests neither buyers nor sellers have a significant advantage nationally.

For buyers, that can mean more time to make decisions, fewer rushed offers and greater confidence that prices are stabilizing.

For sellers, improving sales combined with fewer new listings could gradually create stronger demand if the trend continues.

Are Canadian Home Prices Starting to Recover?

Possibly, but it’s too early to call it a rebound.

The national MLS® Home Price Index increased just 0.1% in July. While small, it was the first monthly increase since November 2024.

Prices remained 3.3% below July 2025 levels, so stabilization is a better description than a new housing boom.

Mortgage Rates Remain the Wild Card

Housing affordability isn’t determined by home prices alone. Mortgage rates can significantly change the monthly cost of buying a home.

The Bank of Canada’s next rate announcement is scheduled for September 2, 2026.

But borrowers should remember that fixed mortgage rates can change even when the Bank of Canada does nothing. Fixed rates are heavily influenced by bond yields, while variable rates are more directly connected to the Bank of Canada’s policy rate.

Global bond yields have been under upward pressure, which could limit how much relief Canadian fixed mortgage borrowers see.

What Should Buyers Do?

A more balanced market can be good news, but it doesn’t mean buyers should rush.

Instead, use this period to:

• get a mortgage pre-approval;
• establish a comfortable monthly payment;
• compare fixed and variable mortgage options;
• understand conditions in your local market; and
• budget for closing costs and ongoing homeownership expenses.

National statistics tell us where the market is heading. Your personal finances should determine when you’re ready to buy.

Bottom Line

Canada’s housing market appears to be moving toward more normal conditions.

Sales are slowly improving, inventory is tightening and prices are showing early signs of stabilization.

For buyers, that could mean a healthier market with less pressure. But with mortgage rates still influenced by uncertain global bond markets, affordability — not market timing — should remain the priority.

Is Canada in a buyer’s or seller’s market?

Nationally, Canada was broadly balanced in July, with a sales-to-new-listings ratio of 51.3%. Local markets can be very different.

Are Canadian home prices rising again?

The national MLS® Home Price Index increased 0.1% in July, its first monthly gain since November 2024. However, prices remained 3.3% below July 2025.

Will mortgage rates fall if the Bank of Canada cuts rates?

Not necessarily. Variable mortgage rates are closely tied to Bank of Canada policy, while fixed rates are influenced primarily by bond yields.

Is now a good time to buy a home?

That depends more on your budget, income stability, mortgage options and local housing market than on national headlines. A balanced market can give prepared buyers more room to make careful decisions.

Cedric Pelletier
Mortgage Associate
Maximal Mortgages 2026

Canada’s inflation rate moved higher in July, but the headline number doesn’t tell the whole story.

The Consumer Price Index (CPI) rose 3.0% year over year in July, up from 2.8% in June. While that might sound like inflation is heating up again, much of the increase came from gasoline and travel costs.

For Canadian homeowners, homebuyers and anyone approaching a mortgage renewal, the more important question is whether inflation is becoming widespread—or if this is a temporary bump.

Key Takeaways

• Headline inflation increased to 3.0% in July.
• Gasoline prices jumped 25.7% year over year, helping push CPI higher.
• CPI excluding gasoline remained much lower at 2.2%.
• The average of the Bank of Canada’s preferred core inflation measures was about 1.95%.
• Grocery inflation slowed to 3.1%, although food costs continue to pressure household budgets.
• The report does not necessarily signal an immediate Bank of Canada rate increase.

Why Did Inflation Rise?

According to Statistics Canada, gasoline was one of the biggest drivers of July’s higher inflation reading.

Gas prices increased 25.7% c

ompared with a year earlier, partly due to geopolitical tensions and disruptions affecting global energy and shipping routes.

Travel also became more expensive. Travel tour prices increased 15.2% year over year, while air transportation prices rose 12.0%.

But when gasoline is removed from the calculation, inflation was just 2.2%—the same rate for three consecutive months.

That distinction matters for interest rates.

Core Inflation Is the Number to Watch

The Bank of Canada doesn’t make interest-rate decisions based on headline CPI alone. It also looks closely at measures of core inflation, which help identify whether price increases are becoming persistent across the economy.

The average of the Bank’s preferred core measures came in around 1.95%, essentially in line with its 2% inflation target.

In simple terms:

Headline CPI: 3.0%

CPI excluding gasoline: 2.2%
Preferred core measures: about 1.95%

This suggests July’s higher inflation rate was driven more by specific categories than a broad resurgence in inflation.

What Does This Mean for the Bank of Canada?

For now, the numbers support a patient approach.

Higher gasoline prices reduce household purchasing power, but an energy-driven increase in inflation does not automatically require higher interest rates.

The Bank of Canada will be watching to see whether higher energy costs begin spreading into other areas of the economy.

If core inflation remains c

ontained and domestic demand continues to slow, the case for keeping the policy rate unchanged becomes stronger.

Based on the current data, a Bank of Canada hold through the remainder of 2026 remains a reasonable base-case scenario, although future inflation and economic reports could change that outlook.

What Does This Mean for Mortgage Rates?

The answer depends on the type of mortgage.

Variable Mortgage Rates

Variable mortgage rates are closely tied to the Bank of Canada’s policy rate.

If the Bank remains on hold, there would be no Bank of Canada-driven reason for variable mortgage rates to increase.

That could provide some stability for borrowers with variable-rate mortgages or those considering one.

Fixed Mortgage Rates

Fixed mortgage rates work differently.

They are influenced heavily by Government of Canada bond yields, which can move based on expectations for future inflation, economic growth and Bank of Canada policy.

This means fixed mortgage rates can rise or fall even when the Bank of Canada does nothing.

If markets view July’s inflation increase as temporary, upward pressure on fixed rates may be limited. If investors become concerned that inflation is becoming persistent, b

ond yields—and potentially fixed mortgage rates—could rise.

Grocery Inflation Is Slowing, But Canadians Still Feel It

There was some good news for household budgets.

Grocery prices increased 3.1% year over year in July, down from 3.9% in June.

However, grocery inflation has now exceeded overall CPI inflation for 18 consecutive months.

This helps explain why many Canadians may not feel much relief even when inflation indicators improve.

Remember: lower inflation does not mean prices are falling. It means prices are increasing more slowly.

For homeowners already dealing with mortgage payments, property taxes, utilities and insurance, those higher everyday costs still matter.

What Should Homeowners and Buyers Do?

Trying to perfectly predict the next mortgage-rate move is difficult.

Instead, focus on what you can co

ntrol.

If you’re buying a home, build your budget around a comfortable monthly payment—not the maximum mortgage you can qualify for.

If your mortgage is renewing, don’t automatically accept your lender’s first offer. Compare fixed and variable options, rates, penalties and prepayment privileges.

And if you’re deciding between fixed and variable, consider your risk tolerance, income stability and future plans, not simply which rate is lowest today.

Bottom Line

Canada’s 3.0% inflation reading looks more concerning at first glance than it does when you dig into the details.

Gasoline and travel costs were major contributors, while CPI excluding gasoline remained at 2.2% and underlying core inflation stayed around the Bank of Canada’s 2% target.

For mortgage borrowers, the key takeaway is simple:

Don’t make a major mortgage decision based on one inflation headline.

Watch the trend in core inflation, Bank of Canada policy and bond yields. Those indicators can provide a much clearer picture of where Canadian mortgage rates may be heading.

This article is for general educational purposes and should not be considered personalized financial or mortgage advice.

FAQ

Does 3.0% inflation mean mortgage rates will rise?

Not necessarily. The Bank of Canada looks at underlying inflation and broader economic conditions. Fixed mortgage rates also depend heavily on bond yields.

What is core inflation?

Core inflation measures attempt to identify persistent price pressures by reducing the impact of unusually volatile price movements. It can give policymakers a clearer view of the underlying inflation trend.

Should I choose a fixed or variable mortgage?

There is no single answer for every borrower. Fixed rates provide greater certainty, while variable rates provide more exposure to future Bank of Canada rate changes. Your budget and tolerance for changing payments should guide the decision.

Should I wait for mortgage rates to fall before buying?

Not necessarily. Rates are only one part of affordability. Home prices, inventory, income and your personal finances can also change while you wait.

Cedric Pelletier
Mortgage Associate
Maximal Mortgages 2026

Can You Still Be a First-Time Home Buyer in Canada?

Many Canadians assume that once you’ve owned a home, you’ve permanently lost access to first-time home buyer programs.

That’s not always true.

The key is that Canada doesn’t have one universal definition of a first-time home buyer. Federal programs, mortgage insurance rules, and provincial incentives all have different eligibility requirements.

Key Takeaways

• Previous home ownership doesn’t always disqualify you.
• Many federal programs use a four-year occupancy rule, not a lifetime ownership test.
• Provincial rebates often have completely different rules.
• Your eligibility depends on which program you’re applying for.

Why the Rules Are Different

Some programs ask:

• Have you ever owned a home?
• Did you live in the home you owned?
• Was it your principal residence?
• Did you inherit an ownership interest?
• Have you recently separated from a spouse or common-law partner?

Because each program asks different questions, you could qualify for one benefit but not another.

Federal Programs May Give You a Second Chance

Programs like the First Home Savings Account (FHSA), Home Buyers’ Plan (HBP), and Home Buyers’ Amount generally look at whether you’ve lived in a home you owned during the current year and previous four calendar years.

If you sold your home years ago and have been renting since, you may qualify again.

Provincial Rules Can Be Stricter

This is where many buyers get caught off guard.

For example, Ontario’s Land Transfer Tax Refund generally uses a lifetime ownership test, meaning previous ownership can permanently eliminate eligibility.

Meanwhile, provinces like Alberta don’t charge a traditional land transfer tax, so different rules apply.

Why This Matters

You might qualify for:

• An FHSA
• The Home Buyers’ Plan
• The Home Buyers’ Amount
• A 30-year insured mortgage (if eligible)

…while not qualifying for a provincial tax rebate.

The same buyer can receive different answers depending on the program.

The Bottom Line

Don’t assume you’ve lost every first-time home buyer benefit simply because you’ve owned a home before.

Every program has its own definition, and the differences could be worth thousands of dollars.

Before making a decision, speak with a mortgage professional who can review your specific situation and identify which programs you may still qualify for.

Frequently Asked Questions

Can I be a first-time home buyer if I owned a home years ago?
Yes. Many federal programs allow you to qualify again if you haven’t lived in a home you owned during the previous four years.

Does owning a rental property disqualify me?
Not always. Some programs focus on occupancy, while others look at ownership history.

Do all provinces use the same rules?
No. Provincial incentives have their own eligibility requirements, which may differ significantly from federal programs.

Cedric Pelletier
Mortgage Associate
780-220-7617

Je parle Francais 🙂

Choosing between a 25- and 30-year amortization is one of the biggest mortgage decisions you’ll make. Many people assume a 30-year amortization is a poor financial choice because you’ll pay more interest over time.

While that’s true on paper, it doesn’t tell the full story.

The best option depends on your cash flow, financial goals, and how you use the money you save each month.

Key Takeaways

• A 30-year amortization lowers your monthly payment.
• Total interest is only one part of the decision.
• Lower payments can improve cash flow and financial flexibility.
• The right choice depends on your personal financial strategy—not just the math.

Why Total Interest Doesn’t Tell the Whole Story

Most mortgage comparisons focus on lifetime interest costs. While a 30-year amortization usually results in more total interest, those payments are spread over decades.

Because of inflation, a dollar paid 25 or 30 years from now isn’t worth the same as a dollar today. Financial planners call this the time value of money.

That’s why looking only at total interest can make a longer amortization appear more expensive than it really is.

The Biggest Benefit: Cash Flow

The main advantage of a 30-year amortization is lower required monthly payments.

That extra cash can be used to:

• Build an emergency fund
• Invest through a TFSA or RRSP
• Pay off higher-interest debt
• Cover growing family expenses
• Reduce financial stress

For many homeowners, flexibility is just as valuable as paying off the mortgage faster.

Flexibility Matters

Choosing a 30-year amortization doesn’t mean you’re locked into paying it off over 30 years.

Most Canadian mortgages allow prepayments, so you can increase your payments or make lump-sum contributions whenever your budget allows.

Think of a 30-year amortization as creating a lower payment floor, while giving you the option to pay it down faster.

When Does a 30-Year Amortization Make Sense?

A longer amortization may be a smart option if you:

• Want to improve monthly affordability
• Have variable or commission-based income
• Plan to invest the payment savings
• Prefer keeping more cash available for unexpected expenses

On the other hand, if your goal is to become mortgage-free sooner and you comfortably afford the higher payment, a 25-year amortization may be the better fit.

The Bottom Line

A 30-year amortization isn’t inherently better—or worse—than a 25-year one.

It’s simply a financial tool.

For some borrowers, paying the mortgage down faster is the right move. For others, lower payments provide flexibility, better cash flow, and opportunities to grow wealth elsewhere.

The best mortgage strategy isn’t about paying the least interest—it’s about choosing the option that supports your overall financial goals.

Frequently Asked Questions

Is a 30-year amortization a bad idea?

Not necessarily. It lowers monthly payments and provides more flexibility, but it generally results in higher total interest if you make only the minimum payments.

Can I pay off a 30-year mortgage faster?

Yes. Most Canadian mortgages include prepayment privileges that allow you to make extra payments and reduce your amortization.

Which amortization is best?

There isn’t a one-size-fits-all answer. Your income, cash flow, financial habits, and long-term goals should determine which option is right for you.

Cedric Pelletier
Mortgage Associate – Maximal Mortgages
780-220-7617

Key Takeaways

• Lower inflation doesn’t automatically make variable rates the better choice.
• Today’s mortgage pricing still favours many fixed-rate options.
• A 3-year fixed offers a strong balance of stability and flexibility.
• The best mortgage depends on your financial situation—not rate forecasts.

Lower Inflation Doesn’t Change Everything

With inflation easing, many Canadians expect variable mortgages to become the obvious choice.

Not so fast.

Mortgage rates are priced based on what financial markets expect to happen—not just today’s inflation. Much of the anticipated movement in Bank of Canada rates is already reflected in current mortgage pricing.

Why the 3-Year Fixed Stands Out

For many borrowers, a 3-year fixed mortgage continues to hit the sweet spot by offering:

• Predictable payments
• Competitive rates
• Flexibility to renew sooner if rates decline

The cost of locking in certainty is currently smaller than many people think.

Variable Mortgages Still Have a Role

A variable mortgage can still be a good fit if you:

• Have a stable income
• Can comfortably handle payment changes
• Want maximum flexibility
• Expect to sell or refinance before your term ends

Choosing a mortgage isn’t about predicting rates perfectly—it’s about choosing the option that best fits your financial goals.

The Bottom Line

Despite lower inflation, a 3-year fixed mortgage remains one of the strongest values in today’s market. It offers stability without giving up much in potential savings, making it a smart option for many Canadians renewing or buying a home.

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FAQ

Does lower inflation mean variable mortgages are better?

Not necessarily. Current mortgage rates already reflect market expectations for future Bank of Canada decisions.

Why are 3-year fixed mortgages popular right now?

They provide payment certainty while allowing borrowers to renew sooner if rates move lower.

Who should consider a variable mortgage?

Borrowers with stable finances, lower debt, and a higher tolerance for changing interest rates.

Cedric Pelletier
Mortgage Associate – Maximal Mortgages

Bank of Canada Holds Rates: What It Means for Your Mortgage

The Bank of Canada is widely expected to keep its policy rate at 2.25%, marking a sixth straight rate hold. While that decision may not surprise markets, the Bank’s outlook could provide important clues about where interest rates are headed next.

For homeowners and buyers, the focus is shifting from “Will rates be cut?” to “When could rates start rising again?”

Key Takeaways

• The Bank of Canada is expected to keep its policy rate at 2.25%.
• Inflation has risen above 3%, increasing pressure for future rate hikes.
• Canada’s economy is showing signs of recovery after a slow start to 2026.
• Some economists expect rate hikes later this year, while others don’t see increases until 2027.

Why Is the Bank Holding Rates?

The Bank continues to balance inflation with economic growth. While inflation remains above target, there is still enough slack in the economy to justify waiting before raising rates.

This gives policymakers time to determine whether higher inflation is temporary or becoming more widespread.

Inflation Is Back in Focus

Higher energy costs have pushed inflation above 3%, but the Bank will be watching for signs that rising prices are spreading into wages and everyday goods.

If inflation stays elevated, interest rate hikes become more likely.

What Are Canada’s Big Banks Predicting?

Economists agree a rate hold is likely this week, but opinions differ on what comes next.

• Scotiabank: Expects rate hikes beginning in late 2026.
• RBC, CIBC & National Bank: Forecast hikes in 2027.
• BMO & TD: Expect rates to remain unchanged through 2027.

The timing will depend on future inflation and economic data.

What This Means for Mortgage Borrowers

A rate hold doesn’t guarantee lower mortgage rates ahead. Fixed mortgage rates are influenced by market expectations, and lenders may adjust pricing if investors expect future Bank of Canada hikes.

If you’re buying a home or renewing your mortgage, it’s a good time to review your options and plan for different rate scenarios rather than waiting for rates to fall further.

Bottom Line

The Bank of Canada is expected to leave rates unchanged, but its messaging may be more important than the decision itself. With inflation remaining above target and economic growth improving, future rate hikes are becoming part of the conversation again.

For borrowers, staying informed and planning ahead is the best way to navigate an uncertain rate environment.

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FAQ

Will the Bank of Canada raise rates this week?

Most economists expect the Bank to hold its policy rate at 2.25%.

Why are rate hikes being discussed?

Inflation has climbed above the Bank’s 2% target, raising concerns that higher interest rates may be needed if price pressures persist.

Should I lock in my mortgage?

That depends on your financial goals and risk tolerance. Speaking with a mortgage professional can help you decide whether a fixed or variable rate is the better fit.

Canada’s economy grew 0.5% in April, beating expectations and marking its strongest monthly gain since last summer. While that’s positive news for the economy, it may also keep pressure on fixed mortgage rates.

Key Takeaways

• Canada’s GDP rose 0.5% in April, above forecasts.
• Growth was led by oil and gas, mining, and construction.
• The 5-year Government of Canada bond yield climbed back above 3%.
• Strong U.S. job openings also pushed bond yields higher.
• Markets now see a roughly 50/50 chance of another Bank of Canada rate hike by year-end.

Why It Matters

Fixed mortgage rates are largely driven by Government of Canada bond yields. As stronger economic data pushes yields higher, lenders have less room to lower fixed mortgage rates.

While Canada’s economy is showing resilience, challenges remain, including trade uncertainty, tariffs, and slower population growth. Even so, stronger-than-expected GDP has reinforced expectations that interest rates could stay higher for longer.

What Homebuyers Should Know

If you’re shopping for a mortgage or renewing this year, don’t expect fixed rates to fall quickly unless bond yields move lower. Economic data over the coming months—especially inflation and employment—will continue to shape where rates go next.

FAQ

Why did bond yields rise?
Stronger Canadian GDP and better-than-expected U.S. job openings increased expectations that interest rates could remain elevated.

Does this mean mortgage rates will rise?
Not necessarily, but higher bond yields typically reduce the likelihood of lower fixed mortgage rates in the near term.

Cedric Pelletier – Mortgage Associate
Maximal Mortgages

Key Takeaways

• Headline inflation increased to 3.2%, mainly due to higher energy prices.
• Core inflation remains close to the Bank of Canada’s 2% target.
• Most economists believe this spike is temporary.
• Mortgage rates could still face upward pressure from rising U.S. bond yields.

Why This Matters

Canada’s inflation climbed to 3.2% in May, but the increase was largely driven by a temporary jump in gas prices. The Bank of Canada pays closer attention to core inflation, which remained near 2%, suggesting underlying inflation is still under control.

While this supports keeping the overnight rate unchanged, fixed mortgage rates depend on bond yields—and those continue to rise despite softer inflation data.

What Could Push Rates Higher?

Markets are looking beyond inflation. Rising U.S. government bond yields, ongoing fiscal concerns, trade uncertainty, and continued AI-driven investment are all putting upward pressure on longer-term interest rates.

What Borrowers Should Consider

If you’re buying a home or renewing your mortgage, don’t assume lower inflation automatically means lower mortgage rates. Fixed rates could remain elevated even if the Bank of Canada stays on hold.

For borrowers seeking certainty, a 3-year fixed or hybrid mortgage may provide a balanced approach while economic uncertainty continues.

FAQs

Will the Bank of Canada cut rates soon?
Most economists expect the Bank to keep rates steady unless core inflation rises meaningfully.

Why are fixed mortgage rates still high?
Fixed rates are driven by bond yields, which are being influenced by global economic factors—not just Canadian inflation.

Cedric Pelletier – Mortgage Associate
Maximal Mortgages

Key Takeaway: Inflation rose to 3.2% in May, its highest level since late 2023, largely driven by higher gasoline and food prices. However, underlying inflation remains relatively stable, reducing pressure on the Bank of Canada to raise interest rates.

What Drove Inflation Higher?

• Gasoline prices surged 33.2% year-over-year due to Middle East supply concerns.
• Grocery costs continued to rise, with fresh vegetables up 9.0% and fresh fruit up 5.3%.
• Air travel costs increased 7.4% as airlines faced higher fuel expenses.

Some Good News

• Core inflation measures remained near 2.1%, suggesting broader price pressures are still contained.
• Shelter costs continued to cool, with rent growth easing to 3.5% and mortgage interest costs declining slightly.
• Recent drops in oil and gasoline prices could help slow inflation in the coming months.

What This Means for Canadians

While higher fuel and food costs are squeezing household budgets, inflation is not spreading broadly across the economy. Current trends support expectations that the Bank of Canada will likely keep interest rates unchanged for the remainder of 2026 unless inflation becomes more widespread.

Bottom Line: May’s inflation spike appears to be driven mainly by temporary energy and food costs rather than a broad resurgence in inflation. For homeowners, buyers, and borrowers, this supports a continued “wait-and-see” approach from the Bank of Canada on interest rates.

Cedric Pelletier – Mortgage Associate
Maximal Mortgages

Key Takeaways

• Home sales posted their strongest monthly gain of 2026 in May.
• Home prices are stabilizing after months of declines.
• Inventory remains balanced at 4.8 months nationally.
• Lower borrowing costs are helping bring buyers back to the market.
• Single-family homes are outperforming the condo sector.
• The Bank of Canada is expected to remain on hold for now.

Why This Matters

After more than a year of uncertainty, Canada’s housing market appears to be shifting from stabilization into recovery. Lower mortgage rates, improved affordability, and more realistic pricing are encouraging buyers to re-enter the market.

For homebuyers, this could be a window of opportunity before competition increases further. For sellers, market conditions are becoming healthier and more balanced.

Sales Activity Continues to Improve

May delivered the strongest increase in home sales so far this year, signaling renewed confidence among buyers.

Several trends suggest momentum is building:

• Stronger sale-to-list price ratios
• Faster selling times
• Slowing price declines
• Improved affordability in many markets

Ontario and British Columbia, where prices have corrected the most, are seeing growing interest from buyers who have been waiting on the sidelines.

Inventory Remains Balanced

New listings fell 1% in May and were down nearly 8% from a year ago.

National inventory sits at just over 200,000 properties, slightly below long-term averages. Months of inventory declined to 4.8 months, close to the historical balanced-market level of five months.

This suggests neither buyers nor sellers currently hold a significant advantage nationally.

Home Prices Are Finding a Floor

The national MLS® Home Price Index slipped just 0.1% in May, the smallest monthly decline since late 2025.

Year-over-year prices remain down 4.2%, but the pace of decline continues to slow.

This stabilization is important because it helps restore confidence and encourages more market activity.

Condos Still Face Challenges

While detached homes continue to see solid demand, many condo markets remain under pressure.

Factors affecting condo demand include:

• Higher ownership costs
• Softer rental markets
• Reduced investor activity
• Slower population growth due to lower immigration targets

However, improving financing conditions should gradually support condo demand over time.

What Could Happen Next?

Housing conditions appear more favourable heading into summer.

Falling oil prices and easing bond yields may reduce inflation concerns and support lower borrowing costs. If inflation remains contained, the Bank of Canada is expected to keep rates unchanged through the remainder of 2026.

The biggest risk remains inflation. Stronger-than-expected inflation data could delay future rate cuts and temporarily slow housing activity.

Conclusion

Canada’s housing market is showing clear signs of improvement. Sales are rising, prices are stabilizing, and inventory remains balanced. While some regional and condo-market challenges persist, the overall trend suggests the market is regaining its footing.

For buyers, improving affordability and stable prices may create opportunities before activity accelerates further. For sellers, growing confidence and stronger demand could lead to better market conditions through the second half of 2026.

FAQ

Is Canada’s housing market recovering in 2026?

Yes. Rising sales, stabilizing prices, and balanced inventory levels suggest the market is moving from stabilization toward recovery.

Are home prices still falling?

Prices remain slightly below last year’s levels, but monthly declines have slowed significantly, indicating prices may be finding a floor.

Will mortgage rates fall in 2026?

While no outcome is guaranteed, markets currently expect the Bank of Canada to remain on hold, with future rate decisions depending largely on inflation data.

Is now a good time to buy a home in Canada?

Many buyers are benefiting from improved affordability, lower prices compared to peak levels, and less competition than during previous market cycles.

Cedric Pelletier – Mortgage Associate
Maximal Mortgages