Canada’s housing revival hits pause as CREA cuts its 2026 outlook
In June, the actual national average sale price reached $696,078, up 0.5% year-over-year, according to CREA’s July 15 data release.
The composite MLS® Home Price Index (HPI) held flat on a monthly basis for the first time since January 2025, though it remained 3.6% below June 2025 levels, indicating that broader price recovery is still tentative.
Rate environment weighs on affordability
The five-year Government of Canada (GoC) bond yield, the primary benchmark lenders use to price fixed-rate mortgages, has been trading near 3.1% in July 2026, according to rate analysis by nesto.ca, after spiking to approximately 3.18% in early July amid renewed geopolitical tensions and elevated oil prices.
That has kept five-year fixed insured rates above 4%, a level that has tested buyer affordability and kept many brokers watching for a meaningful demand catalyst in the resale market.
CREA’s updated forecast notes that Bank of Canada rate hikes this year have “mostly been taken off the table,” a signal likely to reassure both fixed- and variable-rate borrowers. The overnight rate has held at 2.25% since October 2025.
