Will pent-up demand translate into real estate deals for the Canadian market this year? It’s a question buyers, sellers and even agents are asking as we all try to make sense of the prevailing economic conditions.
Predicting the strength of the 2026 market has an element of deja vu.
Just 12 months ago, the property scene was expected to rebound after a turbulent time of post-Covid price corrections and alarming inflation that was finally shrinking thanks to high interest rates.
All the major market dynamics were pointing in the right direction – and then came the tariffs and threats of the United States. These hurt our key industries, injected economic fear and inflamed passions.
We enter 2026 with these same dark clouds hanging over us. Yet more threats are being made following a bilateral trade deal with China.
The key question now is whether Canadians will shake off these issues and pursue their property ambitions as they had intended 12 months ago.
A forecast by the Canadian Real Estate Association (CREA) has based its assumptions on the likelihood of Canadians – especially first-time buyers – pushing forward with their property goals.
The confidence of the first-time buyer segment is critical after being largely excluded for four years by Covid-related price increases and then high interest rates to quell inflation.
The CREA says in its forecast: “While interest rates have not fallen as far as many may have hoped for, they have likely fallen far enough to restore the attainability of homeownership for many, despite affordability that remains more challenging than it was prior to 2020.”
It predicts almost 500,000 homes will go on sale across Canada this year, which would be an increase of 5.1% when compared with 2025. British Columbia and Ontario are both expected to deliver activity increases of 8% because these markets have been subdued.
With more supply coming onto the market, don’t expect significant price increases. The CREA thinks values will rise 2.8% to make the average cost of a home $698,881.
Investors and buyers seeking strong capital growth are recommended to look at the markets of Saskatchewan, Quebec, and Newfoundland and Labrador.
The industry body is confident value increases are sustainable. It says that in 2027 prices will rise a further 2.3% to put the average value of a home at $714,991.
“This would mark the seventh straight year that the national average home price has hovered close to the $700,000 range,” says the CREA.
The number of properties for sale will also increase in 2027, rising 3.5% to 511,966.