Canadian home sales in March 2026 barely budged, but the mood in the mortgage market clearly darkened.
The Canadian Real Estate Association (CREA) has downgraded its forecast for 2026 sales amid a stormy economic climate and continuing uncertainty over the housing market.
The assciation reported that transactions through MLS systems dipped just 0.1% from February, with actual activity 2.3% below a year earlier and prices still drifting lower.
A spike in oil prices late in the month stoked inflation fears, pushed up bond yields and triggered a mid‑March jump in fixed mortgage rates, just as the critical spring market approached.
CREA’s senior economist Shaun Cathcart said that combination has weighed on already fragile sentiment.
“Home sales activity remained at lower levels in March, as rising global economic uncertainty, along with a mid‑month jump in fixed mortgage rates tied to incoming higher inflation, piled on to an already shaky economic start to the year,” Cathcart said.
“2026 is still expected to see a modest amount of upward momentum in sales and a stabilization in prices as some pent‑up first‑time buyer demand enters the market, but the forecast for the year has had to be revised downward.”
Forecast cut as global shocks hit confidence
CREA now expects national home sales to rise just 1% in 2026, to about 475,000 transactions. That's down from the 5.1% growth it projected in January.
The national average price was forecast to climb 1.5% to roughly $689,000 – about $10,000 lower than CREA’s previous call – with almost no growth in British Columbia, Alberta and Ontario and modest gains elsewhere.
Cathcart linked the downgrade directly to geopolitical turmoil.
“Unfortunately, as it pertains to the forecast, we’ve had to change that and lower it because of the situation in the Middle East and the oil shock,” he told CBC News.
He added that buyers are also watching how the U.S. and Israel’s war with Iran would filter through to global growth and interest rates, saying “these massive global disasters, really, … continue to unfold.”
Balanced market, but buyers stayed cautious
On the ground, market balance stayed relatively stable. New listings edged down 0.2% month over month in March and sat at their lowest levels since mid‑2024, helping keep the national sales‑to‑new‑listings ratio at 47.8% – comfortably within CREA’s “balanced” range.
The National Composite MLS Home Price Index fell 0.4% from February and 4.7% year over year, while the actual national average price slipped 0.8% from March 2025 to $673,084.
“While the interest rate situation has recently changed, what could be a challenge for a buyer looking for a fixed rate mortgage may also be seen as more choice and less competition for those choosing a variable rate,” said CREA chair Garry Bhaura.
“Spring tended to be a busier time of year for the housing market, even if it may not have been quite as busy as we were expecting not so long ago. For those of you not impacted by the recent jump in mortgage rates, get working with a local REALTOR® today.”
What it meant for mortgage professionals
For brokers and lenders, the March figures reinforce a story they have already been watching: demand that exists on paper, but often not in approvals.
In 2025, external shocks – then in the form of US tariff threats – had already kept a lid on activity despite lower rates.
CMP
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