The Canadian housing market lost momentum in September, with national home sales falling 2.3 per cent from August and actual activity coming in 7.7 per cent below September 2025.
The latest figures from the Canadian Real Estate Association show that the national MLS® Home Price Index also declined 0.4 per cent month over month and was down 3.4 per cent from a year earlier.
Table of Contents
Canadian Housing Market: Sales and prices weaken across the national market
CREA said the number of newly listed properties fell 1.8 per cent in September, extending a broader downward trend in new supply that has been evident since early 2025.
The national average sale price was $666,538 in September, a 1.6 per cent decline compared with the same month last year.
Unlike the benchmark MLS® Home Price Index, the average sale price can be affected by the types and locations of homes sold during a given month, so the two measures are not directly interchangeable.
The September decline in the composite price index followed four months of broadly stable readings, according to CREA.
The association said the latest monthly drop reflected a fresh step down in Ontario, while price gains in the Prairies, Quebec and Atlantic Canada continued to moderate.
Higher borrowing costs add pressure
The September housing slowdown came as fixed mortgage rates moved higher and buyers faced renewed uncertainty about the direction of interest rates.
On October 28, the Bank of Canada raised its overnight target rate by 25 basis points to 2.5 per cent, with the Bank Rate set at 2.75 per cent.
The central bank said housing was expected to remain relatively weak and warned that the economic outlook remained uncertain, particularly because of Canada-U.S. trade relations.
The Bank of Canada’s announcement confirmed the rate decision.
Higher fixed rates can reduce the amount buyers qualify to borrow even when the central bank’s overnight rate is not the only factor determining mortgage pricing.
For households already close to their borrowing limit, that can mean delaying a purchase, choosing a less expensive property or negotiating more aggressively with sellers.
Market conditions remain balanced nationally
Despite weaker sales, CREA’s national indicators do not point to a broad-based buyer’s market.
The sales-to-new-listings ratio eased to 48.8 per cent in September from 49.1 per cent in August.
CREA generally considers readings between about 45 per cent and 65 per cent consistent with balanced market conditions.
There were 4.9 months of inventory nationally at the end of September, close to the long-term average.
CREA’s benchmark ranges identify a seller’s market as below 3.6 months of inventory and a buyer’s market as above 6.4 months.
More than 200,000 properties were listed for sale on Canadian MLS® systems at the end of September, up 1.8 per cent from a year earlier and slightly above the long-term average.
Regional and property-type differences remain important
The national figures conceal significant differences between provinces, cities and housing types.
A separate September index from Real Property Solutions and Wahi found national home values down 3 per cent year over year.
That report identified sharper declines in several tariff-exposed markets, including Hamilton, Toronto, Vancouver and Victoria.
It also found that row and townhouse values fell 7 per cent nationally, while condominium values declined 6 per cent.
Detached and semi-detached homes recorded smaller annual declines of 2 per cent each in the same index.
At the same time, several markets continued to post gains, including Quebec City, Regina and Montreal.
Statistics Canada reported separately that its New Housing Price Index declined 0.2 per cent nationally in September.
Ontario recorded a 0.5 per cent monthly decline in new-home prices, while British Columbia posted a 0.5 per cent increase.
What the September data means for buyers and sellers
For buyers, the combination of softer sales and near-average inventory may create more room to negotiate in markets where listings are taking longer to sell.
However, lower prices do not automatically mean improved affordability if mortgage rates, property taxes, insurance and other ownership costs remain elevated.
For sellers, the data reinforces the importance of realistic pricing and preparation, especially in markets with weaker condo and townhouse demand.
Properties that are priced above comparable listings may face longer marketing periods as buyers become more payment-sensitive.
The national data also suggests that market conditions should be assessed locally rather than through a single Canada-wide price figure.
When is the next housing market update?
CREA’s next national statistics package is scheduled for November 17, 2026.
Statistics Canada’s New Housing Price Index for October is scheduled for release on November 18.
The Bank of Canada’s next scheduled interest-rate announcement is December 9, 2026.
Frequently Asked Questions
Did Canadian home sales fall in September 2026?
Yes. National home sales fell 2.3 per cent from August, while actual sales were 7.7 per cent lower than in September 2025.
How much did Canadian home prices fall in September 2026?
CREA’s national MLS® Home Price Index fell 0.4 per cent from August and 3.4 per cent year over year.
What was the average Canadian home price in September 2026?
The non-seasonally adjusted national average sale price was $666,538.
Is Canada in a buyer’s market?
Nationally, conditions remained broadly balanced, with 4.9 months of inventory and a sales-to-new-listings ratio of 48.8 per cent.
When is the next Canadian housing market report?
CREA’s next national statistics package is scheduled for November 17, 2026.
Fact-Checked: Key sales, price, inventory, interest-rate and release-date figures were checked against CREA, Statistics Canada and Bank of Canada information.
Disclaimer: Housing conditions vary significantly by region and property type, and national averages may not reflect prices or affordability in a particular community.