Canada’s housing market to ‘remain subdued’ for rest of year: CMHC
Economic uncertainty weighs on home buying decisions.
By Joel Schlesinger for the Calgary Herald, Published Aug 13, 2026
Slow population growth, high borrowing costs and economic uncertainty are likely to continue weighing on Canada’s housing market for the remainder of 2026, a new report has forecast. Canada Mortgage and Housing Corp. released its 2026 Housing Market Outlook Mid-Year Update in late July, noting that several market and economic headwinds will dampen demand for housing across 18 major municipalities for the rest of this year.
It pointed to the Canadian economy’s expected slow growth as consumers, government investment and exports pull back. Uncertainty will further hamper growth. Tariffs and the war in the Middle East are driving uncertainty while clouding the picture for inflation.
Consequently, CMHC expects mortgage rates to remain steady or even increase slightly over the next two years.
Another factor is reduced immigration. The federal government has reduced quotas for newcomers, already resulting in a population decline. That, too, will weigh on housing demand, which is expected to decline, leading to lower prices for the rest of this year.
CMHC further forecast the market should rebound in 2027, but sales will remain below the decade average until the end of 2028.
The report did note the Prairies region, including Alberta, is likely to see stronger sales and price growth than the rest of Canada.
As well, new home starts are expected to decrease as builders adjust to weaker demand, elevated inventories and higher construction costs.
Starts are expected to fall by year’s end, and decline even more in 2027 and 2028.
Rental construction is also forecast to fall in most major markets, which have seen increases in vacancy. Still, CMHC noted challenges will persist for renters as rents should remain high relative to average income.
www.calgaryherald.com/life/homes/canadas-housing-market-to-remain-subdued-for-rest-of-year-cmhc
