Canadian Housing Market Outlook 2026

Home Sales Fall As New Listings Surge And Inventory Nears Balanced Levels

Canada’s housing market began 2026 with softer sales and rising supply, as winter disruptions and cautious buyers slowed activity in key regions. National home sales declined 5.8% month over month in January, while new listings jumped 7.3%. The result was a noticeable shift in short-term market balance rather than a structural drop in demand.

Actual sales activity came in 16.2% below last year, and the MLS Home Price Index declined modestly both monthly and annually. The national average sale price was also slightly lower year over year. However, inventory remains below long-term norms, and months of inventory remain close to historical balanced levels, indicating that the market is cooling rather than correcting.

Canadian Supply Expands As Sales Slow

The national sales-to-new-listings ratio (SNLR) declined to 45%, down from the end of 2025 and slightly below its long-term average. This suggests conditions are moving toward balance after tighter supply conditions in prior years.

Approximately 140,000 properties were listed for sale across Canada at the end of January, up from last year but still below the historical average for this time of year. Months of inventory rose to just under 5 months, which sits near the long-term national benchmark for balanced market conditions.

In practical terms, buyers across Canada are seeing more choice. Sellers remain active, particularly in markets such as Montreal, Calgary, and parts of British Columbia, while weather-related slowdowns have affected parts of Ontario.

Canadian Home Prices Show Regional Divergence

National home prices declined modestly compared to last year, but trends vary sharply by province. Ontario continues to face downward pressure due to elevated inventory and softer sales, particularly in higher-priced urban centres. British Columbia remains subdued, while the Prairies and Quebec are seeing comparatively stronger conditions.

This regional divergence indicates that Canada does not have a single housing story.

Canadian Housing Outlook 2026 to 2028

National home sales are projected to recover gradually through 2026 and beyond, though volumes are expected to remain below long-term averages. Ontario and British Columbia are likely to see temporary rebounds driven by pent-up demand, while the Prairies and Quebec remain comparatively resilient.

New housing construction is expected to decline nationally through 2028, particularly in condominium segments where presales remain weak. Purpose-built rental construction will continue to support supply, but that momentum will moderate as rental vacancy rates rise.

Canada’s rental market is moving toward balance. Higher vacancy rates and slower rent growth are increasing renters’ flexibility, potentially delaying homeownership decisions.

Overall, Canada’s housing market in early 2026 reflects a normalization amid economic pressures rather than a collapse. Sales have cooled, supply has expanded modestly, and prices are stabilizing regionally. The trajectory for the remainder of the year will depend on employment stability, the direction of mortgage rates, and the pace at which sidelined buyers regain confidence.

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Canadian Housing Market Highlights

• The average selling price of a home in Canada decreased by 4.9% year-over-year to $658,300 in January.
• The average selling price of a single-family home in Canada decreased by 4.6% year-over-year to $731,900 in January.
• The average selling price of a townhouse/multiplex in Canada decreased by 6.2% year-over-year to $596,100 in January.
• The average selling price of a condo in Canada decreased by 5.9% year-over-year to $467,100 in January.
• The average rent in Canada decreased by 2% year-over-year to $2,057 for January. 
• February 20, 2026: Today’s lowest mortgage rate in Canada is for a 5-year fixed.

Data from the Canadian Real Estate Association (CREA) indicates that the benchmark price of resale residential homes sold across Canada in January was $658,300, and it decreased by 4.9% compared to a year ago.

CREA also reported a sales-to-new-listings ratio (SNLR) of 45%, indicating Balanced market conditions nationally for January.

Composite Home Prices

Single-family Home Prices

Townhouse and Multiplex Prices

Condo Prices

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Rents Stabilizing After 16 Months of Declines

Canada’s rental market is no longer in freefall, but it has returned to a state of adjustment. The latest national data shows average asking rents declined year over year for the 16th consecutive month. However, the pace of decline has slowed for 3 straight months. This pattern signals a transition from correction to stabilization across most major markets.

Are Rents Still Falling Across Canada?

Rents remain lower than last year in the largest provinces, including BC, Alberta, Ontario, and Quebec. The steepest declines are concentrated in Vancouver and Toronto, two markets that saw outsized growth during the post-pandemic surge. At the same time, provinces such as Saskatchewan and parts of Atlantic Canada continue to see rent growth. This regional divergence confirms the national slowdown is uneven and driven largely by previously overheated urban centres rather than a broad collapse in demand.

Why Are National Rents Cooling?

Several forces are working together to cool down rents. First, new supply has expanded meaningfully over the past 2 years, particularly purpose-built rental and condo completions in major urban centres. Second, population growth has moderated relative to the peak years of immigration. Third, unit sizes have shrunk, lowering total asking rents even as rents per square foot continue rising.

In fact, rents per square foot increased year over year, even while headline rents declined. That means renters are paying slightly more for space, but occupying smaller units. Affordability improvements are therefore partly compositional rather than purely price-driven.

Which Rental Segments Are Strongest Nationally?

Purpose-built rentals have the most stable tenures across Canada. Condo rentals have experienced the sharpest annual declines, especially for studio and 1-bedroom units. These investor-heavy segments are adjusting more quickly as supply outpaces softer demand.

Three-bedroom units are the national outlier. In multiple provinces, larger units have posted modest rent growth. Family-sized rentals remain in shorter supply relative to demand, supporting pricing resilience.

Shared accommodation rents have also declined nationally, reflecting softer demand from students and temporary residents compared to peak levels.

Is Rental Affordability Improving in Canada?

Rental affordability has improved meaningfully. The national rent-to-income ratio has fallen below the commonly cited 30% affordability threshold for the first time in years. That improvement reduces financial pressure on households and may slow the urgency to transition into homeownership, especially in high-priced urban centres.

What Does Rental Affordability Signal for Canada’s Housing Market?

The rental correction is occurring alongside elevated resale inventory and softer home sales in several provinces. Stabilizing rents suggest the market is absorbing recent supply without systemic stress. However, weaker condo rents could pressure investor-owned units and influence future pre-construction activity.

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Canada Market Rents Snapshot

The average rent in Canada was $2,057 for the month of January, which decreased by 2% year over year.

The average rent for a 1-bedroom apartment in Canada was $1,792 for the month of January, which decreased by 3.4% year over year.

The average rent for a 2-bedroom apartment in Canada was $2,176 for the month of January, which decreased by 0.8% year over year.

Rental Price Changes by City

Rank	CITY	Total Average	1 Bedroom	2 Bedrooms	Year-over-Year Change
1	North Vancouver	$2,958	$2,469	$3,287	−2.2%
2	Vancouver	$2,650	$2,362	$3,279	−4.8%
3	Oakville	$2,502	$2,216	$2,576	−19.3%
4	Toronto	$2,504	$2,183	$2,801	−8.6%
5	North York	$2,528	$2,127	$2,688	−1.9%
6	Burnaby	$2,505	$2,144	$2,809	−6.7%
7	Coquitlam	$2,524	$2,107	$2,765	−3.9%
8	Mississauga	$2,446	$2,043	$2,454	−8.6%
9	Etobicoke	$2,382	$2,102	$2,562	−8.3%
10	Kanata	$2,412	$2,238	$2,502	−17.3%
11	Brampton	$2,361	$1,910	$2,208	−7.2%
12	Kingston	$2,315	$1,968	$2,502	22.0%
13	Scarborough	$2,318	$1,910	$2,417	−5.6%
14	Vaughan	$2,266	$2,082	$2,499	−6.7%
15	Greater Sudbury	$2,067	$1,918	$2,167	−2.4%
16	Langley	$2,344	$2,071	$2,465	−1.8%
17	Burlington	$2,376	$2,065	$2,443	−5.0%
18	Ajax	$2,248	$1,814	$2,229	−4.5%
19	Halifax	$2,270	$2,052	$2,500	0.10%
20	Victoria	$2,224	$1,942	$2,605	−5.1%
21	Guelph	$2,159	$1,979	$2,291	−4.0%
22	Kelowna	$2,015	$1,686	$2,124	−10.8%
23	Surrey	$2,124	$1,818	$2,249	−8.5%
24	Ottawa	$2,127	$1,945	$2,458	−2.8%
25	New Westminster	$2,120	$1,872	$2,611	−7.4%
26	Waterloo	$2,230	$2,028	$2,367	−2.7%
27	Oshawa	$2,121	$1,753	$2,052	−5.4%
28	Nanaimo	$2,055	$1,820	$2,328	8.20%
29	Barrie	$2,154	$1,904	$2,184	−1.2%
30	East York	$2,302	$1,963	$2,554	−4.3%
31	Hamilton	$2,069	$1,753	$2,086	0.40%
32	Brossard	$2,066	$1,794	$2,169	1.60%
33	Cambridge	$2,057	$1,797	$2,101	−6.4%
34	Kamloops	$1,992	$1,805	$2,161	5.60%
35	Airdrie	$1,954	$1,450	$1,739	−0.9%
36	Laval	$2,098	$1,710	$2,348	11.00%
37	Kitchener	$2,013	$1,819	$2,130	−4.5%
38	Brantford	$1,979	$1,802	$2,058	0.50%
39	Niagara Falls	$1,929	$1,684	$1,899	−9.4%
40	Montreal	$1,913	$1,710	$2,216	−1.3%
41	London	$1,916	$1,650	$2,051	−4.5%
42	Gatineau	$1,885	$1,655	$2,072	−4.7%
43	Calgary	$1,871	$1,535	$1,850	−3.9%
44	Peterborough	$1,973	$1,677	$1,991	−2.3%
45	St. Catharines	$1,827	$1,608	$1,945	−1.2%
46	Welland	$1,675	$1,506	$1,823	−0.4%
47	Windsor	$1,658	$1,523	$1,839	−0.1%
48	Sarnia	$1,728	$1,508	$1,833	−3.9%
49	Winnipeg	$1,664	$1,409	$1,796	3.10%
50	Côte Saint-Luc	$1,535	$1,402	$1,787	−21.4%
51	Edmonton	$1,591	$1,279	$1,619	−2.6%
52	Saskatoon	$1,566	$1,350	$1,554	4.50%
53	Lethbridge	$1,528	$1,369	$1,570	0.70%
54	Quebec City	$1,485	$1,364	$1,646	−12.3%
55	Red Deer	$1,529	$1,219	$1,489	5.90%
56	Regina	$1,466	$1,255	$1,538	4.80%
57	Fort McMurray	$1,370	$1,167	$1,419	−1.3%
58	Medicine Hat	$1,372	$1,217	$1,395	0.10%
59	Lloydminster	$1,235	$1,025	$1,340	7.70%
60	St. John's	$1,238	$1,086	$1,250	−6.4%

Average Rent by City
Source: Rentals.ca Network Data & Urbanation Inc.

Rental Price Changes by Province

Rental Price Growth by Housing Type

How Does Renting Compare with Homeownership Across Canada?

Each $100,000 in mortgage balance costs an average of $509.35 per month on nesto’s lowest fixed 5-year rate at and $495.28 per month on nesto’s lowest adjustable 5-year rate at .

For each $100,000 in mortgage balance, a 0.25% change in Canada’s policy rate impacts the monthly payment by $13.23. Rates used for calculation are those offered on insured purchases with less than a 20% downpayment on a 25-year amortization. Canada’s policy rate is 2.25%, and nesto’s prime rate is 4.45%.

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Frequently Asked Questions (FAQ) About the Canadian Housing Market in 2026

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Contact our licensed and knowledgeable mortgage experts to find your best mortgage rate in Canada.

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