Canada’s Fall Housing Market Slows as Buyers Revisit the Numbers

September brought softer sales and prices, while higher borrowing costs gave buyers and sellers more to consider.

Canadian home sales fell 2.3% in September, while new listings declined 1.8%, according to the Canadian Real Estate Association’s September report. Activity was 7.7% below September 2025. The national average sale price reached $666,538, down 1.6% from a year earlier.

Higher fixed mortgage rates complicated the start of the fall market. Buyers had slightly softer prices to work with, along with financing that could change what they were comfortable spending. Sellers faced another round of conversations about pricing, competition and timing.

Lower Prices Bring a New Financing Calculation

September’s MLS® Home Price Index declined 0.4% from August and was down 3.4% year over year. The monthly decrease followed four months of relatively stable benchmark prices.

For someone who has been waiting to buy, a lower price can create an opening. Whether it improves their monthly budget depends on the mortgage available when they purchase. Higher borrowing costs can absorb some of the savings and change which homes remain within reach.

CREA identified rising fixed mortgage rates and expectations of a Bank of Canada rate increase before year-end as factors weighing on demand. That expectation adds uncertainty, although it remains a forecast.

“When prices soften, and borrowing costs rise at the same time, buyers can gain negotiating room without gaining purchasing power,” explains Karim Kennedy, CEO of Coldwell Banker Canada. “That helps explain why a market with more choice can still have fewer transactions. Buyers need the price, the financing and their own circumstances to line up before they can move forward.”

For buyers returning to their search this fall, an updated financing conversation can help establish which price ranges and property types still fit.

Fewer New Listings Leave Inventory Near Normal

August’s increase in new listings gave buyers fresh properties to consider. September reversed some of that gain.

With sales falling slightly faster than new supply, the national sales-to-new listings ratio eased to 48.8%, from 49.1% in August. That remained within CREA’s range for balanced market conditions.

Slightly more than 200,000 properties were available for sale at month-end, up 1.8% from September 2025 and a little above the long-term average. Months of inventory reached 4.9, also in line with its historical average.

Buyers may have room to compare properties and negotiate, depending on their market. The national figures still leave considerable variation between neighbourhoods, property types and price ranges. A home competing with several similar listings faces different conditions from one with few comparable alternatives.

Regional Price Differences Still Shape the Search

Ontario’s renewed price weakness contributed to September’s national benchmark decline. Price gains across the Prairies, Quebec and the East Coast also moderated, according to CREA.

For buyers searching across communities, those differences can influence where their budget goes furthest. For sellers, they reinforce the value of recent comparable sales and a close look at the properties currently competing with theirs.

The national average price provides context, though changes in the mix of homes sold can move that number. A larger share of transactions in higher-priced markets or property categories can affect the average without reflecting the experience of an individual homeowner.

“Clients need to understand what’s happening around the property they’re buying or selling,” notes Hashim Arthur, Chief Operating Officer of Coldwell Banker Canada. “Which comparable homes have sold? Where have sellers adjusted their prices? What else can a buyer choose at that budget? Those are the details that help turn a market update into a useful conversation.”

The Homes Being Built Are Changing

Another development worth watching is the growing role of rental housing in new construction.

CMHC’s Fall 2026 Housing Supply Report found that purpose-built rentals accounted for roughly two-thirds of apartment starts in the key markets it examined. Condominium and ground-oriented housing construction weakened sharply in several major cities, including Toronto, Vancouver, Ottawa and Montréal.

For renters, additional supply creates more choice. For future buyers, the mix of construction raises a different question about how many ownership opportunities will be available in the years ahead.

CMHC warns that insufficient construction during the current slowdown could leave Canada short of housing when demand strengthens again. Today’s resale inventory and tomorrow’s new housing supply need to be considered together.

The Bank of Canada’s October 1 discussion of housing affordability made a related point. Interest rates can influence demand, but they cannot directly resolve construction barriers, rezone land or accelerate permits. Lasting affordability improvements require progress on supply as well.

A Slower Market Calls for Better Pricing Conversations

For broker owners, September’s figures put more weight on helping agents work through changing expectations with clients.

Teams need to understand which price ranges are attracting interest, where comparable listings are accumulating and whether a property’s asking price reflects recent transactions. Financing conversations also need to stay current as buyers revisit their budgets.

“Strong brokerage leadership gives agents the confidence to have honest pricing conversations,” adds Paul Abbott, National Vice President, Franchise Development at Coldwell Banker Canada. “When a home isn’t attracting interest, agents need support to assess what’s happening, explain it clearly to the seller and recommend the next step. That’s where consistent coaching makes the difference for agents and, ultimately, their clients.”

September gave buyers and sellers another reason to look closely at their next move. The most useful starting point is the property, the competition and the financing available today. Those details will shape how the rest of the fall unfolds.

Whether you are considering buying, selling or just watching the market evolve, Coldwell Banker Canada real estate professionals are here to guide you home with confidence, expertise and clarity.