Interest and mortgage rates are settling into what is expected to be their low point for the coming months, but economists say that will have a limited impact on any rebound in the housing market.
David-Alexandre Brassard, chief economist of the Chartered Professional Accountants of Canada, said buyers are still on the sidelines waiting for further price declines and they’re more patient than in the past.
“The buyer in 2026 is not the buyer of 2021,” said Mr. Brassard in a news release. “People now know that home prices can go down–and stay down–for a long time. That changes the pace of recovery.”
He says that buyers end up being the ones that usually relent to sellers’ expectations in this kind of environment. But that may not necessarily be the case this time around.
Shaun Cathcart, senior economist for the Canadian Real Estate Association, noted that the agency’s home price index dropped by 0.3 per cent on a month-over-month basis in December’s sales data. His hunch is that motivated sellers were finally dropping prices to offload their properties before the end of the year.
However, he didn’t believe this downward pressure is bound to continue into 2026. CREA is forecasting a 1 per cent increase in national home prices in 2026.
Mr. Brassard believes that curbs on immigration and that persistent patience from buyers will limit any rebound in the overall real estate market this year.
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