In January 2026, CREA forecasted national home sales growth of +5.1%, anticipating a strong rebound after rates stabilized. However, Q1 data fell short of expectations — March sales were down -0.1% month-over-month and -2.3% year-over-year, with spring mortgage rate increases further suppressing demand. On April 16, CREA slashed its annual sales forecast to +1% (approximately 474,972 units), while trimming the average price forecast by ~$10,000 to $688,955.

💡 CREA specifically noted: Ontario and BC remain the weakest markets in 2026, with sales growth near zero or slight declines — far below the national average. This cross-validates with BCREA's BC-specific forecast (sales -2.1%) released the same day.

In January 2026, BCREA forecasted a strong rebound for BC sales at +12% (78,690 units) and a price increase of +3% to $982,800. However, in its Q2 Housing Market Update released April 27, BCREA Chief Economist Brendon Ogmundson admitted: "2026 has started very challenging", slashing the annual forecast to sales -2.1% (~69,000 units) and average price -1.4% ($939,800).

Active listings hit highest level since 2015, with Greater Vancouver's sales-to-active-listings ratio at just 14.2% — below 20% confirms a buyer's market. Ogmundson emphasized that the market needs a "longer period of stability" to release pent-up demand, with sales forecast to rebound 7.7% in 2027 — contingent on inventory digestion and rate stability.

Montreal's countertrend strength deserves attention: both single-family homes and plex prices hit record highs in March. Quebec housing activity remains above its 10-year average. Core drivers: affordability advantage — Montreal's average price is just 62% of Toronto's and 56% of Vancouver's — plus Quebec is less affected by federal temporary resident restrictions, keeping demand relatively stable.

National condo prices are down approximately 5% year-over-year, driven by weakening investor demand and high carrying costs. More concerning is GTHA (Greater Toronto-Hamilton Area) rental data: vacancy rate surged to 5.4%, net rents fell 3.8%, unsold completed condos reached 4,295 units (all-time high), requiring 92 months to clear at current sales pace. Another 11,424 condos had rental plans cancelled — with 4,064 shifted to the rental market, further pressuring supply.

GTHA's rental collapse serves as direct evidence of condo market stress, consistent with the logic that Vancouver's newly completed high-end condos temporarily lift average prices while masking underlying weakness. Common factors across both regions: supply surge + immigration slowdown + high-rate environment.

Between Q4 2025 and Q1 2026, Canada's total population decreased by approximately 103,500, primarily due to a reduction of ~170,000 non-permanent residents (study permit restrictions, work permits expiring). While 2026 PR targets remain at 380,000, new temporary resident intake has been sharply cut to 385,000: study permits 155,000 (down 49% YOY), work permits 230,000 (down 37% YOY), aiming to reduce the temporary population to below 5% of total population.

Quebec, as a Francophone province, is less affected by federal temporary resident restrictions — this is one of the underlying reasons for Montreal's countertrend housing strength.

A Reuters special report, "Canada's Housing Bubble Contraction Stalls Stock Market Wealth Effect," cut to a core contradiction: Housing accounts for over 70% of Canadian household net wealth. Falling home prices trigger a "reverse wealth effect" — households feel poorer and reduce consumption. Economists estimate that every 10% drop in home prices reduces household spending by 0.5-1%.

The Bank of Canada's policy rate remains at 2.25%. While TD believes the next move is more likely a rate cut, energy inflation and geopolitical risks continue to influence the path. The reverse wealth effect is an important variable the Bank must weigh — falling home prices are themselves generating significant tightening effects.

From April 1, 2026, to March 31, 2027, Ontario is eliminating the 13% HST on newly built homes valued at or below $1 million (maximum rebate $130,000), with phase-out for homes over $1.5 million. The key distinction: applies to all buyers (not just first-time buyers) — making it one of Ontario's most aggressive housing stimulus measures in history.

Effect Assessment: Short-term boost to new home presales and construction starts — clearly supported by the Ontario Home Builders' Association. However, indirect impact on resale/used homes. In a high-rate environment, monthly payment affordability remains the core constraint — the HST rebate cannot fully offset interest costs. Focus on Q3 2026 new home sales data to verify policy effectiveness.