Canada’s Housing Market Weakens Further in November as Buyer Caution Persists
Canada’s residential real estate market slumped in November, with sales declining and home prices falling as sellers offered discounts to move properties.
The decline led real estate experts to push back predictions of an improvement in housing markets to next spring, when stable mortgage rates are expected to lure more buyers into the market.
National home sales fell by 10.7 per cent compared with last November and dropped 0.6 per cent month-over month, according to data released early Monday by the Canada Real Estate Association (CREA).
The average national home price fell by 3.8 per cent compared with last November, to $674,800, CREA said. The largest declines in home prices came in Vancouver, Toronto and Ontario’s industrial heartland of Kitchener, Woodstock and London.
In November, sellers made concessions on home prices to get transactions done before the end of the year, CREA senior economist Shaun Cathcart said in a news release.
Back in January, CREA chair Valérie Paquin said the agency predicted 2025 “would be the year that housing markets came out of their interest rate-induced hibernation.”
But those predictions have not been borne out. The number of homes sold in Canada fell 1.8 per cent in the first 11 months of the year compared to the same period last year, while the average national home price was down 1.1 per cent.
“With interest rates now even lower as a result of a softer economy, the focus shifts to the spring of 2026, and whether we’ll finally see the return of more normal levels of housing activity,” said Ms. Paquin in the release.
The number of new homes listed for sale fell by 1.6 per cent in November compared with the previous month. The ratio of sales-to-new-listings was 52.7 per cent, which CREA said is “consistent with balanced housing market conditions.”
At the end of November, there were 173,000 properties listed as for sale across the country, up 8.5 per cent from last November but 2.5 per cent below the long-term average for this time of year. That represents 4.4 months worth of inventory, which CREA said is also a sign of a balanced market.
Heading into 2026, real estate experts say a stable outlook for mortgage rates is likely to attract more home buyers into the market.
In 2025, the Bank of Canada reduced its target for the overnight lending rate four times, bringing the key rate down to its current level of 2.25 per cent. Last Wednesday, the central bank held the line on rates and is widely expected to remain on hold through the first half of 2026.
“Solid market fundamentals – including lower interest rates, increased supply, and reduced competition – have created a more favourable environment for consumers,” Royal LePage CEO Phil Soper said in a recent report
“Mortgage rates are no longer the villain in this story,” Mr. Soper said. “Buyers can move forward without worrying they are missing out on cheaper money tomorrow.”
Five-year variable rate mortgages, a popular option with home buyers, now come with a 3.45-per-cent interest rate, according to data service Ratehub.ca, matching the lowest levels seen since the spring of 2022.
“It’s been a tepid year for Canadian real estate, with stagnant sales and price growth,” said Penelope Graham, mortgage expert at Ratehub.ca. “It’s clear prospective homebuyers are still constrained by affordability challenges, and ongoing economic unease.”
“However, now that rate stimulus is ending, it may lead to a sense of urgency in the market, as motivated buyers make a move while rates are still comparably low,” Ms. Graham said in a media release.
Next year, Royal Lepage predicted the median price of a single-family detached home will increase 2 per cent to $876,934, while condominium prices will fall 2.5 per cent to $563,918.
Quebec City, Montreal and Regina will be the country’s hottest real estate markets in 2026, according to Royal Lepage, with home prices rising by 5 to 12 per cent.
Royal Lepage predicted home prices will continue to fall in the Toronto and Vancouver regions, the country’s two most expensive markets. The agency predicted Toronto home prices will fall by 4.5 per cent, while Vancouver prices will drop 3.5 per cent by the fourth quarter of 2026 compared with the same period a year ago.
This article was first reported by The Globe and Mail
