OTTAWA, Ontario – Canadian home sales activity remained virtually unchanged in March 2026, with the number of transactions recorded across MLS® Systems experiencing a slight dip of 0.1% month-over-month. This stagnation occurred against a backdrop of increasing global economic uncertainty and a mid-month rise in fixed mortgage rates, which were linked to expectations of higher inflation.
Economic Uncertainty and Mortgage Rate Jumps Dampen Market
Shaun Cathcart, CREA’s Senior Economist, noted that home sales activity persisted at lower levels in March. He attributed this to a combination of factors, including rising global economic uncertainty and a mid-month surge in fixed mortgage rates, driven by incoming inflation data. These pressures added to an already challenging start to the year for the Canadian economy.
Despite the subdued March figures, 2026 is still anticipated to witness modest upward momentum in sales and a stabilization of prices. This outlook is partly based on the expectation that pent-up demand from first-time homebuyers will eventually enter the market. However, Cathcart cautioned that the forecast for the year has been revised downward. The timing of the mortgage rate increases, coupled with the perception that these hikes might be temporary, could deter potential buyers during the typically active spring months of April, May, and June, as they opt to wait for rates to decrease.
March Market Highlights
- National home sales were nearly flat, down 0.1% month-over-month.
- Actual (not seasonally adjusted) monthly activity was 2.3% lower compared to March 2025.
- The number of newly listed properties saw a marginal decrease of 0.2% month-over-month.
- The MLS® Home Price Index (HPI) declined by 0.4% from February to March and was down 4.7% year-over-year.
- The actual national average sale price decreased by 0.8% year-over-year in March 2026.
Supply Constraints Persist
New listings in March edged down by 0.2% month-over-month. This slight reduction in supply may contribute to the lower sales numbers observed so far in 2026, as new housing supply has been running at its lowest levels since mid-2024.
With both new listings and sales showing little change, the national sales-to-new listings ratio held steady at 47.8%. This figure remains below the long-term average of 54.8%, a range typically indicative of balanced housing market conditions.
Mortgage Rate Impact and Market Outlook
Garry Bhaura, CREA’s 2026-2027 Chair, acknowledged the recent shift in the interest rate environment. He suggested that while higher fixed mortgage rates might pose a challenge for some buyers, they could also present more choice and less competition for those considering variable-rate mortgages. Bhaura added that spring typically sees increased activity in the housing market, even if this year’s pace might be somewhat slower than initially anticipated. He encouraged buyers not significantly impacted by the rate increases to engage with local REALTORS®.
At the end of March 2026, there were 167,524 properties listed for sale across all Canadian MLS® Systems. This represents a modest 1% increase from the previous year but remains 10.6% below the long-term average for this period. Overall housing supply has been on a general decline since May of last year.
National inventory levels stood at five months at the close of March 2026, consistent with January and February figures and aligned with the long-term average. For context, a seller’s market is generally considered to be below 3.6 months of inventory, while a buyer’s market is above 6.4 months.
The National Composite MLS® Home Price Index (HPI) saw a 0.4% decrease month-over-month in March. While not a substantial drop, it was a smaller decline than observed in February and half the decrease recorded in January. This trend aligns with tightening sale-to-list price ratios in recent months, influenced by fewer listings entering the market. CREA’s forecast for 2026 includes price stabilization, which is seen as a crucial development for buyers looking to re-enter the market in greater numbers.
