Phil Soper expects improved consumer confidence will bring buyers back to the market in 2026
Housing market conditions are slowly becoming more balanced across Canada. Price growth has cooled in many regions, with the country’s two priciest markets seeing modest pullbacks. Borrowing costs have steadied at levels that support normal market activity, and inventory has been rebuilding after years of tight supply.
Yet, despite these improvements, many Canadians remain hesitant to make a move.
“The past four years delivered an unrelenting supply of uncertainty. First, high rates. Then political drama and global trade tension,” said Phil Soper, President & CEO, Royal LePage®. “It left many people conditioned to wait for the next shoe to drop. That instinct is understandable. But, the data tells a very different story: Canada’s housing market is moving forward again – quietly, steadily, step by step.
“Our frontline Realtors share their stories with me. They tell me confident young families are back, saying the time is right. The reset is behind us. Now we build.”
The affordability shift
Interest rates are no longer the primary obstacle for consumers in the market.
“After almost two decades of ultra-low borrowing costs, the return to more normal mortgage rates can feel jarring. You are forgiven if you’re relatively new to the business and believe sub-3% mortgages are typical. They are not. Those rates were born out of crisis – first, the 2008 collapse of the American financial system, and more recently, the extraordinary global disruption caused by the COVID pandemic,” said Soper.
The Bank of Canada has reduced rates nine times since 2023’s pandemic-driven peak inflation. Mortgage rates are now both the new and the old normal – healthy, sustainable rates that align with a balanced economy.
“Royal LePage’s early 2025 consumer research showed 29% of consumers eager to buy a home were waiting for rates to drop. This fall, our central bank has been clear: they will not stimulate demand through monetary policy and risk a rebound in inflation. The very strong employment performance that closed 2025 hammered that point home,” Soper added.
With popular fixed mortgages in the 3-4% range, buyers can now move forward without worrying that cheaper borrowing will be available next week. That clarity alone has begun to unlock demand.
The reset begins
Royal LePage’s 2026 Market Survey Forecast projects very modest price gains and more significant improvements in sales activity through 2026, as buyers continue to move off the sidelines. Nationally, it’s expected that the aggregate price of a home in Canada will rise just 1.0% year over year in the fourth quarter of 2026. Detached homes are forecast to see prices increase 2.0%, while condominium values are expected to decline 2.5%, as sharply lower immigration, temporary foreign worker and foreign student numbers reduce the size of the renter base, which means the return of investor-buyers will be slower.
Market conditions vary by region – as they always do across the country – and that diversity is a sign of balance. In Calgary, Edmonton, Regina, Winnipeg, Ottawa and Halifax, home prices are expected to continue to post small incremental gains. Affordability remains a competitive advantage in these cities, supporting stable demand.
Meanwhile, Greater Montreal is forecast to see gains of 5.0%, and Quebec City remains the standout performer among the country’s major markets, with prices projected to rise 12.0% next year, on the strength of major public works projects and limited supply.
“Home values in the premium-priced markets of greater Toronto and Vancouver are expected to decrease by single digits, creating a rare opportunity for buyers of Canada’s most costly homes,” said Soper. “For first-time buyers, historically the toughest places in the country to break into the market, the current environment represents a rare window. Less competition. More inventory. Better negotiating conditions. Stable home values.
“These don’t look like the headlines of a crisis. They look like opportunity.”
Housing supply: We can’t ease off now
The path to restoring affordability runs through supply – and while momentum is building, it hasn’t been consistent everywhere.
“Years of under-building got us into this affordability challenge, and only building can get us out of it,” noted Soper. “There has been real progress: CMHC reported that housing starts in Canada’s largest markets reached record highs in 2025, as municipalities embraced favourable zoning policies and politicians woke up to the supply challenge.
“Yet, it hasn’t been uniform. Toronto and Vancouver are seeing steep declines in pre-construction sales, leading to major project delays and cancellations. The issue will resolve itself in due course. I am not worried about the economic future of these vibrant, world-class cities.”
Soper has an important message surrounding national housing stock: “We can’t ease up simply because home price inflation isn’t making headlines today. Canada still has a structural shortage of homes. It will take years of disciplined building to correct it.”
The type of housing that gets built is just as important as increasing supply. Duplexes, triplexes and row homes offer the mix of space, density and affordability that Canadians are urgently looking for, without creating urban sprawl.
“Edmonton and Calgary are great examples of what is possible. That’s the direction Canada needs to keep driving toward – a housing system built for the future, not just the next market cycle,” added Soper.
A call to confidence
Canadians have earned a reprieve from the cycle of home prices that continuously outstripped wages and salaries.
“Royal LePage’s research shows that Millennials and Generation Z consumers embrace the same strong desire for home ownership as their parents,” said Soper. “For many, the path forward is now clearer. And the smart move isn’t to wait – it is to act on the opportunities that exist today. Real estate rarely rewards hesitation; it rewards participation.
“The math makes sense again. Affordability has improved. Competition has cooled. Inventory is growing. Prices are stable. Rates are stable. These are not caution signs – they are green lights. A steady, sustainable recovery is underway, and those who step forward early will benefit most.”
1 Despite falling prices and lower interest rates, many renters are still pressing pause on home ownership, June 19, 2025
