Want to buy or sell property in Canada next year? The Canadian real estate market in 2026 is expected to continue its gradual recovery, moving away from the volatility of the mid-2020s. The national picture will be characterized by rising sales volumes as interest rates stabilize in “stimulative territory,” but price growth will be modest and highly diverse across regions. International buyers remain drawn by Canada’s fundamental stability, though they must now navigate complex ownership restrictions.
📈 Key Trends Shaping the 2026 Market
The Canadian real estate landscape in 2026 will be defined by three key trends:
1. Price Stabilization and Sales Recovery
National average home sales are forecast to rebound significantly in 2026, projected to rise by around 7.7% or more, as pent-up demand from the high-rate period re-enters the market. However, price appreciation is expected to be modest, with the national average price forecast to increase by approximately 3.2%. This suggests a gradual, measured recovery rather than a rapid boom.
2. Regional Divergence
The national forecast masks deep differences between provinces:
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Ontario and British Columbia are expected to see the weakest price growth or even slight declines in average prices, primarily due to high inventory levels and the continued strain of affordability issues, especially in the expensive Vancouver and Toronto markets.
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The Prairies (Alberta, Saskatchewan) and Atlantic Canada (Nova Scotia, New Brunswick) are projected to outperform the national average, seeing stronger price gains (potentially $4\%$ to $8\%$) due to lower housing costs, higher relative rental yields, and continued population growth driving tight supply-demand balances.
3. Shift in Housing Investment
Market challenges are driving significant structural shifts in investment:
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Purpose-Built Rental (PBR): The housing affordability crisis has shifted capital away from condos and towards PBRs, student housing, and seniors’ residences. This is a major growth area for institutional and private capital.
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Private Capital’s Role: With traditional bank debt constrained, private capital (REITs, family offices, private debt) is increasingly filling the financing gap, creating opportunities for innovative deal structures in new growth areas.
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Inventory and Supply: A high supply of listings, particularly in the urban condo segments of Toronto and Vancouver, is keeping a lid on price growth in those expensive markets.
🌍 Why International Buyers Invest in Canada
Despite a federal Prohibition on the Purchase of Residential Property by Non-Canadians Act (currently extended to 2027) which bans non-residents from buying residential homes, international capital remains attracted to the country for several reasons. Furthermore, foreign capital is still utilized to fund development and purchase pre-sale units (though subject to specific rules and amendments to the ban).
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Economic & Political Stability: Canada is viewed globally as a safe haven for capital. Its stable political environment, conservative and well-regulated banking system, and strong legal framework provide a sense of security unmatched by many other G7 nations.
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Immigration and Demographic Demand: Canada maintains high immigration targets (though slightly reduced from peak levels), which creates persistent, structural demand for housing and especially rental properties. Investors view this demographic driver as a reliable long-term foundation for real estate value.
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High Quality of Life: Canadian cities consistently rank highly on global liveability indexes (Vancouver, Calgary, and Toronto are frequent top-ten entries). This reputation attracts high-net-worth individuals and skilled workers who sustain the demand for both luxury and rental properties.
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Portfolio Diversification: For many global investors, Canadian real estate offers a key way to diversify their portfolio and gain exposure to a G7 economy that is less prone to sudden regulatory shifts or economic crises than other markets.
📍 Most Popular Destinations for Real Estate Investment
While traditional major centers remain important, the investment focus is shifting to areas offering a better balance of price and growth.
1. The Powerhouses (High Cost, High Security)
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Toronto, Ontario (GTA): Remains Canada’s financial and economic engine. Investment is now pivoting from traditional condo purchases to purpose-built rental and alternative sectors (e.g., medical offices, student housing) to capitalize on the massive rental demand.
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Vancouver, British Columbia (GVA): The prime gateway to the Pacific. Investment is focused on the luxury segment and commercial assets, as well as new PBR developments to address the housing crisis.
2. The Yield Leaders (High Momentum, Relative Affordability)
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Calgary, Alberta: Currently ranked by Canadian real estate executives as the city with the strongest real estate prospects for 2026. It offers the highest relative affordability among major cities, a diversified economy, and landlord-friendly legislation, driving some of the best rental returns in the country.
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Halifax, Nova Scotia: The economic engine of Atlantic Canada. Driven by low housing vacancy rates and explosive population growth from immigration and inter-provincial migration, it offers a strong growth and rental yield narrative.
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Moncton, New Brunswick: Known as the fastest-growing Census Metropolitan Area (CMA) in the country. It offers one of the lowest barriers to entry and remains a key logistics and service hub in Atlantic Canada, making it a favorite for cash-flow investors.
3. Lifestyle and Secondary Markets
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Montreal, Québec: Known as Canada’s most affordable “glamour city,” offering a unique European culture and lower price points than Toronto or Vancouver, sustaining strong long-term demand.
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Kelowna, British Columbia (Okanagan Valley): Attracting retirees, remote workers, and students due to its lifestyle appeal (wineries, lakes, skiing) and growing tech sector, creating sustained demand for rental units and vacation homes.
