TD Economics has revised its housing market outlook, now expecting home sales and prices in Canada to decline in 2026 following weaker-than-anticipated activity earlier in the year. The updated forecast reflects ongoing affordability pressures and cautious buyer sentiment, with economic uncertainty contributing to slower market momentum. Analysts say elevated borrowing costs and softer demand are limiting recovery prospects in the near term, prompting a more subdued outlook than previously anticipated.

The revised forecast suggests the housing market will take longer to stabilize, with activity expected to remain muted before improving in future years. While interest rates have stabilized, they are not expected to significantly stimulate demand in the short term. The report highlights that buyers remain cautious and market conditions are adjusting gradually, indicating that a stronger rebound may take more time to materialize.

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