Canadian home sales hit a four-year September high
Aditi Gupta, Content Specialist
Canada’s housing market took a small step back in September, but overall activity remained stronger than it’s been in years. According to the Canadian Real Estate Association (CREA), home sales slipped 1.7% from August, marking the first monthly decline since spring. Even so, transactions were still 5.2% higher than last year, making this the most active September since 2021.
The monthly slowdown was driven mainly by fewer sales in several major markets, including Vancouver, Calgary, Edmonton, Ottawa, and Montreal. Those declines outweighed gains in the Greater Toronto Area and Winnipeg, which helped keep national totals relatively stable.
After five consecutive months of growth, September’s results suggest the market is pausing to catch its breath — not cooling. As CREA Senior Economist Shaun Cathcart explained, “activity was still running at the highest level for that month since 2021.” He added that with “three years of pent-up demand still out there and more normal interest rates finally here,” sales are expected to regain momentum through late 2025 and into 2026.
Balanced conditions return
September brought only minor shifts in supply, reinforcing balanced market conditions nationwide. New listings edged down 0.8%, while the sales-to-new listings ratio eased slightly to 50.7%, from 51.2% in August. This ratio points to a balanced market overall. Historically, the national average sits around 55%, with ratios between 45% and 65% generally indicating an even match between buyers and sellers.
There were 199,772 homes listed for sale across Canadian MLS® Systems at the end of September, up 7.5% from a year earlier and roughly in line with long-term seasonal norms. At the same time, inventory levels held steady at 4.4 months, the lowest since January and below the long-term average of five months. For context, anything under 3.6 months typically indicates a seller’s market, while over 6.4 months points to a buyer’s market.
CREA Chair Valérie Paquin noted that while there are “more buyers in the market now than at almost any other point in the last four years,” overall sales activity remains slightly below historical averages, leaving room for further growth as confidence returns.
Price stability continues after early-year correction
After several months of declines early in 2025, prices have now held steady since April, suggesting the market has found its footing. In September, the MLS® Home Price Index (HPI) slipped just 0.1% month-over-month and was down 3.4% year-over-year. The national average sale price edged up 0.7% from September 2024 to $676,154.
CREA noted that as last year’s sharper price drops move further into the rearview, year-over-year comparisons are expected to narrow through the fourth quarter. Overall, national pricing trends point to a market that has adjusted to higher borrowing costs and is now showing signs of gradual stabilization rather than volatility.
Housing outlook heading into late 2025 and early 2026
As market conditions continue to warm up, CREA released an updated market forecast, following its last in July. In its latest forecast, CREA projects that 473,093 homes will change hands in 2025 — a 1.1% dip from 2024, reflecting slower activity in British Columbia, Alberta, and Ontario, partly offset by gains in other provinces. The national average home price is expected to edge down 1.4% to $676,705.
While this means the market may fall short of the 500,000 transactions CREA predicted a year ago, the association sees solid momentum building into 2026. National home sales are forecast to rebound by 7.7% next year, reaching 509,479 transactions — the highest level since 2021, though still slightly below the 10-year average. The national average price is projected to rise 3.2% to $698,622, returning to the $700,000 range that has defined much of the past decade.
For buyers, the coming months may represent a rare window of opportunity, with prices stabilizing and mortgage rates hovering near multi-year lows. The conditions for re-entry are stronger than they’ve been in years. As momentum builds into 2026, buyer activity is expected to strengthen further, particularly if rates hold steady and inventory remains tight.
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Aditi Gupta, Content Specialist
Aditi Gupta is a content specialist at Ratehub, with a focus on creating informative content about mortgages.