\u201cHousing activity will likely remain weak in the near term, as very slow population growth, uncertainty, high borrowing costs and modest income growth continue to limit demand,\u201d CMHC said.<\/p>\n
\u201cWe expect sales to improve gradually over the forecast period but to remain below levels typically seen in the last decade.\u201d<\/p>\n
The organization predicts modest improvement to the housing market in 2027 and 2028, when economic growth is expected to pick up. Overall, CMHC says its outlook \u201chas changed little\u201d since it released its last major forecast in the winter<\/a>.<\/p>\n \u201cBaseline growth in 2026 is still expected to be a modest 0.7 per cent,\u201d it said. <\/p>\n \u201cConsumer spending, government investment and a rebound in exports should support growth. On the other hand, weaker residential construction and strong import growth should weigh on the economy.\u201d<\/p>\n Regional variance <\/p>\n CMHC noted that when it comes to economic conditions, different regions within Canada are likely to experience varying levels of growth.<\/p>\n \u201cWestern Canada is expected to lead growth in 2026, helped by stronger commodity prices resulting from the U.S.-Iran war. Central Canada is more affected by trade risks and is likely to lag,\u201d it said.<\/p>\n \u201cConditions in Atlantic Canada remain the weakest\u2026 as the economy strengthens more broadly, differences between regions should narrow, supported by more diversified trade and stronger business investment.\u201d<\/p>\n CMHC predicts that \u201cmarket momentum\u201d will keep sales high in the Prairies and in Quebec, while Canada\u2019s two largest provincial markets, Ontario and British Columbia, are expected to continue to struggle, as affordability issues and slowed population growth eat into sales volumes. <\/p>\n \u201cHome prices will continue to adjust to weak housing demand and muted sales. Prices are expected to decline through 2026 and then grow only modestly afterward,\u201d CMHC said.<\/p>\n \u201cOverall, very slow population growth and limited income gains should keep price increases moderate across the country.\u201d<\/p>\n Uncertainty at home and abroad <\/p>\n The two largest drivers of economic volatility and uncertainty in Canada at the moment continue to cloud housing market forecasts, CMHC noted. <\/p>\n![\"\"](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2026\/07\/IN5FMEPVMCMFALQOHUYK2SNWEI.jpg\")
Homes are pictured at a suburb in Halifax on Nov. 28, 2023. THE CANADIAN PRESS\/Darren Calabrese Homes are pictured at a suburb in Halifax on Nov. 28, 2023. THE CANADIAN PRESS\/Darren Calabrese <\/p>\n
![\"\"](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2026\/07\/SCD3VUU5Z4LMKYMEBZPLYG4MGM.jpg\")
President Donald Trump speaks to reporters before boarding Air Force One, Wednesday, July 22, 2026, at Joint Base Andrews, Md. (AP Photo\/Julia Demaree Nikhinson) President Donald Trump speaks to reporters before boarding Air Force One, Wednesday, July 22, 2026, at Joint Base Andrews, Md. (AP Photo\/Julia Demaree Nikhinson) <\/p>\n