Home prices set to hit record in 2026 amid unrelenting demand: CMHC
Canadian housing prices could reach a new record by 2026, driven by unrelenting demand from a growing population, according to an outlook published by the national housing agency on Thursday.
Canada Mortgage and Housing Corp.’s 2024 Housing Market Outlook predicts that while sales fell by a third and prices dropped 15 per cent during the slowdown of the past few years, the period has set the stage for a resurgence.
“During this time, the pool of potential homebuyers grew through robust population growth, increased savings and higher incomes. As mortgage rates and economic uncertainty decrease in the second half of 2024, we expect buyers to start returning to the market,” CMHC said in the report.
Lower interest rates and a stronger economy combined with the strong population growth recorded in 2023 — the highest since the 1950s — are expected to contribute to a recovery in sales, which will include a shift in toward lower-priced homes and markets across Canada.
The report projects that sales levels in 2025 and 2026 will slightly surpass the 10-year average but remain below the record levels seen in 2020 to 2021, as housing continues to be expensive for the average household.
Regional variations in home prices and construction starts are also expected, with the Prairie provinces projected to perform well due to their affordable home prices and stronger economic outlook. That economic strength is expected to attract homebuyers and jobseekers, leading to increased home construction with fewer constraints on skilled workers.
The outlook for housing starts is more bleak in Ontario and British Columbia.
High home prices in these provinces are expected to make certain home types unaffordable, while developers may struggle with
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