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Canada's housing market slowed in September, with national home sales falling 1.7 percent from the previous month, according to the Canadian Real Estate Association (CREA). The decline ended a five-month streak of steady growth seen since April. Lower sales in markets such as Greater Vancouver, Calgary, Edmonton, Ottawa and Montreal outweighed gains in the Greater Toronto area and Winnipeg. Despite the monthly dip, sales were 5.2 percent higher than a year ago. CREA noted that activity still reached its strongest level for September since 2021, reflecting continued underlying demand despite recent price softness.
Home sales across Canada fell 1.7 percent in September compared with August, based on data from the Canadian Real Estate Association (CREA). This marked the first monthly decline after five consecutive increases that started in April. Advertisement
The drop was led by weaker sales in major cities including Greater Vancouver, Calgary, Edmonton, Ottawa and Montreal, which together outweighed gains recorded in the Greater Toronto area and Winnipeg. However, on a yearly basis and without seasonal adjustments, home sales were still up 5.2 percent compared with the same month last year.
Shaun Cathcart, senior economist at CREA, said that while the earlier upward trend paused in September, market activity remained the highest for that month since 2021. He added that with several years of accumulated housing demand and interest rates now returning to more typical levels, the association expects home sales to pick up again over the final quarter of the year and into 2026.
The Bank of Canada recently reduced its benchmark interest rate to a three-year low of 2.5 percent, aiming to support affordability and improve borrowing conditions. Despite that, the national Home Price Index (HPI) recorded a slight month-on-month dip of 0.1 percent. On a seasonally unadjusted basis, the HPI was down 3.4 percent compared with a year earlier, indicating modest price corrections in several markets.
According to CREA's updated forecast, national home sales are projected to decline 1.1 percent in 2025 compared with 2024, before rebounding by about 7.7 percent in 2026. The average home price is expected to drop 1.4 percent in 2025, followed by a 3.2 percent increase the next year.
The association noted that while higher borrowing costs and cautious buyer sentiment continue to weigh on short-term activity, recent rate cuts could help restore stability. Regional variations remain significant, with markets in Western Canada showing sharper corrections, while the Greater Toronto area continues to see comparatively resilient demand.
Overall, CREA's outlook suggests that Canada's housing market is likely to see a gradual improvement through 2026 as borrowing conditions ease and demand continues to adjust after years of volatility.
Source Reuters
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