Will 2026 Be a Good Year to Buy a House in Canada?

If you're contemplating entering Canada's housing market, 2026 could present a strategic window of opportunity—but with important regional caveats. Here's what leading forecasters are predicting and what it means for prospective buyers.

The National Outlook: Recovery in Motion

After a challenging 2025 marked by economic uncertainty and tariff concerns, Canada's housing market is positioned for a rebound in 2026. National home sales are forecast to increase by 7.7% to 509,479 units—the highest level since 2021, though still below that peak and slightly under the 10-year average.

Price trends tell a similar recovery story. The national average home price is expected to decline by 1.4% to $676,705 in 2025, then increase by 3.2% to $698,622 in 2026. While these aren't dramatic gains, they signal market stabilization and renewed buyer confidence after years of volatility.

What's Driving the 2026 Recovery?

Multiple factors are converging to create favorable conditions. A gradual recovery is expected in the second half of 2025, setting the stage for stronger demand in 2026, driven by prospective buyers re-entering the market as economic fears ease and lower interest rates gain traction.

Pent-up demand remains substantial. Millions of Canadians delayed homeownership decisions during the highinterest-rate environment of 2022-2024. As affordability improves and economic conditions stabilize, this accumulated demand should support market activity.

Interest rates are expected to remain relatively stable, with most forecasters predicting the Bank of Canada will hold rates steady through 2026. While additional rate cuts are unlikely, the current environment represents significantly improved affordability compared to 2023-2024.

Regional Variations: Location Matters More Than Ever

Canada's housing market remains highly fragmented, with dramatically different outlooks depending on location.

Ontario and British Columbia face continued challenges. Strong competition among sellers will likely keep prices under pressure with declines continuing into early 2026 before steadying, particularly in condo markets in Toronto and Vancouver. Decade-high inventory levels in these provinces mean buyers will have substantial negotiating power, but price appreciation will be limited.

Prairie Provinces tell a different story. Saskatchewan is forecast to lead with 6.5% price growth in 2026, followed by Manitoba at 5.3%, supported by tight market conditions, robust job growth, and relatively strong affordability. These markets offer opportunity for buyers seeking value and growth potential.

Quebec and Atlantic Canada are expected to see balanced conditions with modest price gains in the 4-6% range, benefiting from steady demand and limited oversupply issues plaguing larger markets.

The Affordability Picture

Declining ownership costs driven by lower rates and moderating prices in some regions have made homeownership the most affordable it's been in three years. However, significant challenges persist. Despite improvements, carrying costs in Ontario and BC remain well above pre-pandemic levels.

Reduced immigration targets will slow population growth and household formation, tempering demand particularly in rental markets. This demographic shift should help prevent the explosive price growth seen in previous years.

Should You Buy in 2026?

2026 looks favorable if:

• You're targeting Prairie provinces, Quebec, or Atlantic Canada where fundamentals are strong
• You're a first-time buyer with stable employment and adequate down payment
• You're comfortable with modest 3-5% annual appreciation rather than dramatic gains
• You're shopping in markets with excess inventory (Ontario, BC) and want negotiating power
• You're purchasing for long-term homeownership rather than short-term speculation

Continue waiting if:

• You're hoping for significant price crashes in major markets (unlikely according to forecasts)
• You lack job security or expect major income changes
• You're purely speculating on short-term gains
• You're unable to comfortably handle current mortgage rates

The Bottom Line

2026 won't be a dramatic boom year, but it represents a return to more normal, balanced market conditions— exactly what many buyers have been waiting for. The frenzied competition of 2021-2022 is gone, affordability has improved from recent highs, and inventory levels provide selection and negotiating power.

For those with stable finances and realistic expectations, 2026 could offer the Goldilocks scenario: accessible pricing without fierce competition, stable interest rates without further dramatic cuts, and modest appreciation potential without bubble risks.

The key is matching your purchase to regional realities and personal circumstances rather than trying to time a perfect market bottom that may never arrive.