Canada Housing Market Shows Improving Stability

Canada’s housing market continued to stabilise in May 2026, with buyer activity gradually strengthening across many regions. Lower borrowing costs, improving affordability and stronger homebuyer confidence supported greater market participation during the spring season.

Nationally, conditions remained relatively balanced. Inventory levels continued to give buyers ample choice, while home prices generally stayed below year-ago levels. This helped keep affordability in focus and prevented competition from rising too quickly.

However, tightening supply in selected markets and improving sales activity suggest that Canada’s housing market may be moving closer to equilibrium.

Toronto Gains Momentum, Vancouver Remains Balanced

The Greater Toronto Area showed stronger momentum in May. Home sales increased 6.3% year-on-year to 6,583 transactions, while new listings fell 18.9% compared with May 2025.

Even as market conditions tightened, buyers still benefited from softer pricing. The MLS® HPI Composite benchmarkwas down 6.7% year-on-year, while the average selling price reached $1,069,700, down 4.6% from a year earlier.

In Metro Vancouver, the market remained more balanced. Residential sales totalled 2,150 transactions, down 3.5% year-on-year, while new listings declined 7.6%.

Inventory remained elevated, with active listings more than 34% above the region’s 10-year average. The benchmark price for all residential properties stood at $1,100,700, down 6.2% year-on-year, giving buyers more selection and keeping price growth contained.

Outlook

Canada’s housing market is expected to move toward steadier conditions in the coming months. If buyer demand continues to recover and supply tightens further in key cities, price declines may moderate.

For buyers, the current market still offers choice and negotiating room. For sellers, improving activity is positive, but realistic pricing remains essential.