The quick read — is the market stabilizing?
- Home sales rose for three straight months through June 2026 (RBC).
- National average price forecast at $686,710 for 2026 — up just 1.1% year over year (CREA).
- CREA revised its 2026 sales forecast down on July 15 to 463,336 transactions.
- RBC calls the recovery “barely holding,” noting June activity was ~12% below the 10-year average.
- Affordability improved to its best reading in four years in Q1 2026.
Why this question matters right now
If you have watched Canadian housing headlines this year, you have probably felt the whiplash. One week the market is bouncing back. The next, RBC warns of a “long road ahead.” A friend in Calgary says prices are holding while a cousin in Toronto says listings are piling up.
This is why buyers, renewers, and would-be sellers keep asking the same question: has the market actually turned a corner?
The July 2026 updates from RBC and the Canadian Real Estate Association gave us the clearest read in months. The story is calmer than the headlines suggest, but more nuanced than a simple “recovery is here.” For broader context, see our read on why Canada’s housing market is entering a new phase.
Quick start — pick your path
Prices have flattened, inventory has grown, and affordability is at a four-year best. Use this window to get pre-approved and understand your qualifying number. Start with our first-time buyer resources.
Rates are steadier than they were 18 months ago, but the payment shock from a 2020-era renewal can be real. Run your renewal number against a refinance option before signing back to your current lender.
Regional gaps matter. Selling in Toronto and buying in Calgary looks very different than the reverse. Get your local months-of-inventory figure before pricing your listing.
What “market resilience” actually means
Three measures tell you whether a housing market is truly finding its balance:
The MLS Home Price Index (HPI) tracks the value of a typical home rather than an average sale price. Averages can swing based on which homes sold that month. The HPI filters out that noise.
The sales-to-new-listings ratio (SNLR) compares homes sold with homes newly listed. Between 45% and 65% is balanced. Below 45% favours buyers. Above 65% favours sellers.
Months of inventory tells you how long it would take to sell every active listing at the current pace. Under three months is tight; four to six is balanced; over six months means supply is heavy. For plain-English definitions of these terms, see our mortgage terms glossary.
The numbers behind the July 2026 stabilization story
The three-month streak is real but slowing. Sales rose 0.9% in April, 5.5% in May, and just 0.5% in June. RBC’s Robert Hogue called it a “sharp deceleration.” Adjusted for seasonality and annualized, June transactions were still roughly 12% below the 10-year average.
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CREA’s July 15 revision moved the wrong direction. In April, CREA expected modest annual sales growth in 2026. Three months later, it downgraded to a 1.4% decline. The national average home price is now forecast at roughly $686,710 for 2026, up just 1.1% from 2025.
The Bank of Canada policy rate has held at 2.25% through mid-2026, and further hikes are largely off the table. That typically helps both fixed- and variable-rate borrowers plan with more confidence. For a fuller look at the year ahead, see our Canada real estate outlook for 2026 buyers.
Where the resilience is real — and where it isn’t
The national headline hides big regional gaps. Ontario is the only province forecast to post higher annual sales in 2026 than in 2025, according to CREA’s July 15 update. That is not a signal of a hot market. It is a signal that Ontario has already worked through more of the downturn than other provinces.
British Columbia sits on the other end. Vancouver housing starts fell 35% year-over-year in June 2026. RBC has flagged excess inventory in both Ontario and BC as the reason prices may still edge lower before rising again.
Alberta looks different. Oil-price tailwinds have supported the Calgary and Edmonton markets, where prices are roughly flat year-over-year and inventory remains tight in Calgary. Quebec faces a different pressure: slower population growth is weighing on housing demand sooner than expected. Any Quebec closing will also involve a notary rather than a lawyer.
Pegasus Mortgage Lending Center Inc. FSRA Lic #11479
The takeaway: “the Canadian market” is really several markets moving at different speeds. For a city-by-city breakdown, see our Canada housing market by city 2026 analysis.
A step-by-step read on whether now is your moment
Rather than trying to time a national market, walk through four steps that ground the decision in your own numbers.
- 1Check your local months-of-inventory.Ask your realtor for the current months of inventory in your target neighbourhood. Under three months means sellers still hold leverage. Four to six is balanced. Over six months means buyers can negotiate.
- 2Run the payment on your qualifying rate.The OSFI B-20 stress test requires Canadian borrowers to qualify at the greater of contract rate plus 2% or 5.25%. Run your target mortgage payment at that qualifying rate, not the rate you would actually pay.
- 3Compare renewal, refinance, and new purchase math side by side.If you already own, a renewal at your current lender is rarely the best offer. Getting a competing quote can sometimes save more per year than any market-timing decision.
- 4Decide on a pre-approval window.A pre-approval typically holds your rate for 90 to 120 days at no cost, giving you cover if rates move up while you shop. Working with a broker means you access dozens of lenders on one application. Razi Khan, Founder and CEO of Pegasus, built the platform around exactly this: one conversation, more than 50 lender options, and independent guidance rather than a single-bank pitch.
Pegasus Mortgage Lending Center Inc. FSRA Lic #11479
Common mistakes buyers make in a stabilizing market
A stabilizing market invites its own set of mistakes. These are the traps we see most often when buyers or renewers step into a market that is finding its balance.
- Waiting for a headline all-clear. Media headlines lag actual market conditions.
- Ignoring regional differences. A national average tells you little about your neighbourhood. Toronto down 7.9% and Montreal up 5.8% both fold into the same national headline.
- Over-anchoring to the national average price. The $686,710 national figure is skewed by which regions have the most sales.
- Missing the affordability window. RBC’s affordability measure improved to 53% in Q1 2026 — the best reading in four years. Further improvement may be limited.
- Skipping the stress test math. Buyers often shop at the contract rate and forget the qualifying rate. That gap is where surprises happen.
- Treating a balanced market like a buyer’s market. Sellers at the 49% SNLR level are not desperate. Bidding aggressively low may lose you the property.
- Going direct-to-bank instead of shopping lenders. A single bank sees one product menu. See why work with a broker for the fuller picture.
Frequently asked questions
Is the Canadian real estate market finally stabilizing in 2026?
Are home prices going up or down in Canada right now?
Is now a good time to buy a house in Canada?
When will the Canadian housing market fully recover?
Which Canadian cities have the most resilient housing markets?
Should I lock in a mortgage rate now or wait for the market to stabilize further?
What does a “balanced market” actually mean for me as a buyer?
Is it better to buy now or keep renting through 2026?
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About the author
Razi Khan
Founder, CEO & Licensed Mortgage Broker · Pegasus Mortgage Lending · Toronto, Ontario · FSRA Lic #11479
Razi Khan is the Founder, CEO, and a licensed Mortgage Broker at Pegasus Mortgage Lending Center Inc., based in Toronto. With over 20 years of experience in the Canadian mortgage industry, Razi has personally guided more than 3,000 clients through some of the most complex and high-stakes financial decisions of their lives — from first-time purchases in the GTA to refinancing strategies, alternative lending solutions, and cross-border mortgages for Canadians buying in the United States.
Razi founded Pegasus in October 2008, launching the brokerage at the height of a global financial crisis. He works across the full spectrum of borrower profiles, with particular expertise in complex files including self-employed borrowers, credit-challenged clients, and investors building multi-property portfolios.
Learn more about Razi Khan →Sources & References
- RBC Economics — Canada’s housing market takes another small step towards recovery (July 15, 2026) — https://www.rbc.com/en/economics/canadian-analysis/canadian-housing/monthly-housing-market-update/canadas-housing-market-takes-another-small-step-towards-recovery/
- CREA — Quarterly forecast revision (July 15, 2026) — https://www.crea.ca/housing-market-stats/canadian-housing-market-stats/quarterly-forecasts/
- CREA — Monthly statistics (July 15, 2026) — https://stats.crea.ca/en-ca/
- CBC News — CREA downgrades housing market forecast (July 15, 2026) — https://www.cbc.ca/news/business/crea-revision-june-2026-9.7269900
- RBC Economics — Housing affordability improves in most Canadian major markets (Q1 2026) — https://www.rbc.com/en/economics/canadian-analysis/canadian-housing/housing-affordability/improving-housing-affordability-continues-in-most-canadian-major-markets/
- OSFI — Guideline B-20: Residential Mortgage Underwriting Practices — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/residential-mortgage-underwriting-practices-procedures-guideline-b-20
- Bank of Canada — Key interest rate — https://www.bankofcanada.ca/core-functions/monetary-policy/key-interest-rate/