CMHC Officially Forecasts Falling Home Prices in 2026 — A Market-Wide Slowdown Expected This Year

Published Thursday, July 30, 2026 · Rates, market figures and outlooks in this article reflect its publication date and may differ today. Ask us for the latest picture. Translated from the Korean original.

Canada Mortgage and Housing Corporation (CMHC) has officially revised its outlook downward, now forecasting that home sales, prices and housing starts will all decline in 2026. Its analysis is that economic uncertainty, high borrowing costs and slowing population growth are combining to push buyers out of the market. Its February outlook had projected increases in both sales and prices, but in just five months the forecast has completely reversed.

Key Points

• About 457,200 home sales nationally expected in 2026 — down 2.8% from about 470,314 in 2025
• National average home price of about $675,200 — down 0.6% from about $679,543 in 2025
• About 241,400 housing starts expected in 2026 — down 6.8% from about 259,028 in 2025
• Condo markets in Ontario and BC under the greatest pressure from oversupply and weak pre-sales
• Only the Prairies (Alberta, Saskatchewan, Manitoba) are expected to see rising sales and prices — deepening regional divergence
• Rising vacancy rates in Toronto, Vancouver and Montreal → rent growth expected to slow, though rents remain high relative to incomes
• A modest recovery expected in 2027–2028, but sales are not expected to return to the 10-year average
• CMHC deputy chief economist: "Price declines alone are not enough to bring demand back"

What It Means

CMHC's downward revision is not just a numbers adjustment. The national housing agency has officially declared that "2026 is a year of decline," which could have a significant impact on market sentiment. The reason buyers are not returning even as prices fall is economic uncertainty and high borrowing costs, so unless rates come down, any recovery in demand is likely to be limited. Regionally, the condo markets in Ontario and BC are having the hardest time, while the relatively affordable Prairies are expected to continue on a different trajectory. From a mortgage perspective, falling home prices can affect existing owners' equity and their LTV (loan-to-value ratio) at renewal, so caution is needed. A recovery is forecast for 2027–2028, but it looks likely to be slow; for the time being, rather than expecting a sharp price rebound, a realistic approach is one centred on genuine end-user demand within a stabilizing market.