Residential Market Commentary - CMHC housing outlook

Things are looking a little better for Canada’s housing market this year, in the eyes of Canada Mortgage and Housing Corporation.  The national housing agency has released its latest Housing Market Outlook and is projecting modest growth in sales and prices for 2026. 

CMHC’s baseline forecast predicts home sales will rise to 489,000 units, up from 470,000 in 2025.  The average price is also expected to rise, climbing to $698,000 compared to $680,000 last year. 

Those numbers are in line with latest forecasts from the Canadian Real Estate Association.  The country’s realtors expect 494,500 properties to change hands (+5.1%) with an average price of a little less than $690,000 (+2.8%). 

Beyond the U.S. trade challenges and the economic uncertainty that have been dominating the headlines, Canada Mortgage and Housing points to several other factors that are likely to subdue the market including: lower population growth; weak income growth; higher mortgage costs; and a, generally, more cautious attitude among buyers. 

Despite all the political hoopla about Canada’s housing shortage, CMHC is forecasting fewer housing starts for this year – 247,000 compared to 259,000 in 2025.  The agency says developers are facing higher construction costs, weaker demand and rising inventories of unsold units. 

Purpose built rentals are expected to lead new construction, with condominium apartments seeing the biggest declines.