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In its third scheduled announcement of 2026, the Bank of Canada held the target for the overnight lending rate at 2.25%. This marks the fourth consecutive hold to interest rates since October of last year.

Rising global energy prices tied to the conflict in Iran are adding upward pressure on inflation. For now, the Bank says there is limited evidence that higher oil prices are significantly impacting the cost of other everyday goods and services, though this remains a key area to watch. The focus is on keeping inflation pressures temporary and preventing longer-term price increases. Looking ahead, upcoming Canada–United States–Mexico Agreement negotiations this summer, along with ongoing tariffs, could also influence the direction of interest rates.

“If the United States imposes significant new trade restrictions on Canada, we may need to cut the policy rate further to support economic growth. Alternatively, if oil prices continue to increase, and particularly if they remain elevated, the risk that higher energy prices become ongoing generalized inflation increases. If this starts to happen, monetary policy will have more work to do – there may be a need for consecutive increases in the policy rate,” said Tiff Macklem, Governor of the Bank of Canada, in a press conference with reporters following the announcement. 

“Of course, these are not the only possible outcomes. We will be watching developments closely and assessing their implications for growth and inflation. As the outlook evolves, we stand ready to respond as needed.”

In March, Canada’s Consumer Price Index (CPI) increased 2.4% year over year, up from 1.8% in February. The acceleration was largely driven by higher gasoline prices, with consumers paying 5.9% more than they did in March of the previous year. However, the increase was somewhat tempered by base-year comparisons, as March 2025 prices included the since-eliminated consumer carbon levy. Meanwhile, labour market conditions remained relatively stable, with the employment rate holding at 60.6% last month.

Risk of rising rates could spur springtime activity 

With inflation pressures resurfacing, mortgage rates could move higher in the near term. As a result, buyers with pre-approvals may feel added urgency to act this spring to avoid rising borrowing costs, potentially supporting an uptick in market activity. Fixed rates have already started to edge higher in recent weeks, tracking bond yields as they respond to ongoing market volatility.

“With inflation pressures resurfacing, the Bank of Canada has no room to lower interest rates further – and the next move could be upward,” said Phil Soper, president and CEO, Royal LePage. “For buyers planning to enter the market this year, securing a mortgage pre-approval sooner rather than later is a prudent step, particularly as rate holds have a limited shelf life. As that reality sets in, we expect more buyers to come off the sidelines through the spring and summer months.”

According to the Royal LePage^® House Price Survey and Market Forecast, the aggregate¹ price of a home in Canada decreased 2.0% year over year to $812,900 in the first quarter of 2026. On a quarter-over-quarter basis, however, the national aggregate home price remained relatively flat, increasing just 0.7%.

The Bank of Canada will make its next interest rate announcement on June 10th, 2026. 

Read the full April 29th report here. Want to know more about how the overnight lending rate works? Read our explainer on how the Bank of Canada uses this financial tool.

On Wednesday, in its second scheduled announcement of 2026, the Bank of Canada opted to hold the target for the overnight lending rate at 2.25%. This marks the third consecutive hold to interest rates since October of last year.

Escalating conflict in the Middle East has added volatility to energy prices in recent weeks, renewing concerns about inflation as gas prices climb and financial markets react negatively. While the Canadian economy is still expected to grow modestly as it adjusts to US tariffs, the Bank noted that recent data points to weaker-than-anticipated growth in the near term. However, it is still too early to assess the full impact of the conflict on Canada’s economic outlook, according to the central bank.

“The Canadian economy continues to face heightened uncertainty related to US trade policy and geopolitical risks. Now the war in Iran has added a new layer of uncertainty. Its impact on the global and Canadian economies will depend on how long the conflict lasts and the extent to which it spreads across the Middle East. Inflation in Canada has been close to the 2% target for more than a year. But, as we’ve seen, the war in Iran is causing oil prices to move sharply higher and this will push up inflation in the short term,” said Tiff Macklem, Governor of the Bank of Canada, in a press conference with reporters following the announcement.

“Governing Council will look through the war’s immediate impact on inflation but if energy prices stay high, we will not let their effects broaden and become persistent inflation.”

According to Statistics Canada, the country lost 84,000 jobs in February, pushing the unemployment rate to 6.7%. In the same month, Canada’s Consumer Price Index (CPI) rose 1.8% year over year, down from 2.3% in January. The main factor driving inflation lower last month was the end of the federal tax holiday in February last year. However, higher fuel prices could have the opposite effect in the coming months.

Early spring buyers benefit from steady lending rates

With the Bank opting to hold rates steady once again, homebuyers entering the market in the coming weeks can expect a period of relative stability in borrowing costs.

“Despite growing geopolitical uncertainty, interest rates remain steady following today’s Bank of Canada announcement. As global markets react to developments in the Middle East, policymakers will be watching closely for any impact on inflation and, ultimately, borrowing costs,” said Phil Soper, president and CEO, Royal LePage. “For Canadians preparing to purchase a home or renew their mortgage this spring, the key takeaway is stability. Today’s decision provides households with a measure of certainty as they plan major financial commitments in the weeks ahead.”

According to the Royal LePage^® House Price Survey and Market Forecast, the aggregate¹ price of a home in Canada decreased 1.5% year over year to $807,200 in the fourth quarter of 2025. On a quarter-over-quarter basis, the national aggregate home price posted a similar decline of 1.1%, reflecting softer market conditions and persistent buyer caution that weighed on activity during the traditionally active fall season.

The Bank of Canada will make its next interest rate announcement on April 29th, 2026. 

Read the full March 18th report here. Want to know more about how the overnight lending rate works? Read our explainer on how the Bank of Canada uses this financial tool.

The Canadian real estate market closed out 2025 with a modest decline in housing prices, reflecting lingering hesitation among buyers. Looking ahead to spring, lower borrowing costs may support a gradual return of activity, but economic uncertainty is expected to keep momentum in check.

According to the Royal LePage^® House Price Survey and Market Forecast, the aggregate¹ price of a home in Canada decreased 1.5% year over year to $807,200 in the fourth quarter of 2025. On a quarter-over-quarter basis, the national aggregate home price posted a similar decline of 1.1%, reflecting softer market conditions and persistent buyer caution that weighed on activity during the traditionally active fall season.

“Despite subdued activity levels, home prices largely held their ground in the final quarter of 2025,” said Phil Soper, president and CEO, Royal LePage. “Economic uncertainty – driven by trade disputes and broader geopolitical tensions – has weighed on consumer confidence and muted what is typically a more active fall market. Instead of a fall seasonal surge, we saw a quieter close to the year. 

“That said, buyers heading into the spring market have a meaningful advantage over last year: lower borrowing costs, stable or lower property prices, and choice. In an era where home inventory is chronically constrained, inventory levels are Goldilocks healthy. Together, these conditions are creating a genuine window of opportunity, particularly for first-time buyers in Canada’s most expensive markets.”

The Royal LePage National House Price Composite is compiled from proprietary property data nationally and regionally in 64 of the nation’s largest real estate markets. When broken out by housing type, the national median price of a single-family detached home decreased modestly by 0.8% year over year to $849,100, while the median price of a condominium decreased 2.9% to $575,300. On a quarter-over-quarter basis, the median price of a single-family detached home and a condominium declined 1.3% and 0.9%, respectively. Price data, which includes both resale and new build, is provided by RPS Real Property Solutions, a leading Canadian real estate valuation company.

Condo market softness continues in urban centres

Price softness in Toronto and Vancouver has been most evident in the condominium segment, which remains challenged by headwinds from elevated inventory levels, a pull-back from investors, and hesitancy among first-time buyers who often enter the market via this property segment. 

“Condominium markets in major urban centres remain under pressure, as weaker demand continues to collide with increased supply,” said Soper. “During the brief period of elevated interest rates following the pandemic, many small-scale investor-landlords found the cash flow math no longer worked. Higher carrying costs forced some to exit the market, adding to resale supply.

“Under normal conditions, investors would be expected to return as borrowing costs eased through 2024 and 2025. This time, however, the timing worked against them. Reductions in immigration numbers, as well as quotas for temporary foreign workers and international students, have sharply curtailed rental demand, leaving fewer tenant customers just as rates began to fall.”

Spring market to see modest momentum

Spring has historically been one of the most active periods in the housing market calendar, driven by improved weather conditions, pent-up demand from the winter months, and the flexibility to move during the summer. In 2026, the spring market is expected to bring a renewed sense of momentum, though not the sharp surge in activity seen in past cycles. Continued consumer caution and a lingering lack of urgency are likely to temper both sales activity and price growth, keeping market conditions more balanced.

“The conditions are in place for a more active spring market in 2026. Interest rates are no longer a barrier to home ownership, inventory levels are healthy, and economic indicators continue to point to moderate growth in both GDP and employment,” said Soper.

“What continues to be a drag on the housing market is consumer confidence. Greater clarity on trade relations with the United States would certainly help, but there’s also a more subtle shift underway. After a full year of economic and political turbulence, more and more households have given up waiting for perfect certainty and are refocusing on what is happening at home, and what matters most: securing the right housing for their families. As that adjustment takes hold, we expect it to gradually translate into increased market participation.”

Read Royal LePage’s fourth quarter release for national and regional insights. 

Fourth quarter press release highlights:

• The Greater Montreal Area’s aggregate home price increased 4.5% year over year, while the greater Toronto and Vancouver markets recorded declines of 5.7% and 4.1%, respectively, in the fourth quarter. 
• Quebec City recorded the highest year-over-year aggregate price increase (13.2%) among Canada’s major regions for the seventh consecutive quarter.
• Royal LePage expects spring market activity to rise, but not surge, as buyers re-engage amid reduced borrowing costs and improved housing affordability.

Read The Full RLP Article Here

After a year defined by economic uncertainty and shifts in government on both sides of the border, 2026 is shaping up to be a true reset for the Canadian real estate market. Increased supply, lower borrowing costs and easing competition are expected to gradually bring more buyers back to the offer table in the year ahead.

The aggregate¹ price of a home in Canada is set to remain relatively flat, increasing a modest 1.0% year over year to $823,016 in the fourth quarter of 2026. The median price of a single-family detached property is expected to increase 2.0% to $876,934, while the median price of a condominium is anticipated to decrease 2.5% to $563,918.²    

“Solid market fundamentals – including lower interest rates, increased supply, and reduced competition – have created a more favourable environment for consumers,” said Phil Soper, president and chief executive officer, Royal LePage. “First-time buyers and those searching in the country’s most expensive regions have a rare window to act on their home ownership plans at reduced prices. While we don’t expect a sharp rebound, this improved affordability will rebuild market confidence among both buyers and sellers, setting the stage for more sustainable, albeit modest, price growth in 2026.”

Bank of Canada winds down rate cutting cycle

In 2025, the Bank of Canada reduced its target for the overnight lending rate four times, bringing the key rate down to its current level of 2.25%. After an 18-month rate-cutting cycle that followed two-decade-high interest rates, the Bank has now shifted its focus to supporting a cooling economy while keeping inflation on a sustainable path. Economists widely expect the Bank will only make further cuts if the economy shows major signs of weakness as Canada continues to navigate trade tensions with the United States. 

“Mortgage rates are no longer the villain in this story. Borrowing costs have stabilized at a level that supports healthy market activity. Buyers can move forward without worrying they are missing out on cheaper money tomorrow. That clarity alone will unlock demand,” concluded Soper. 

According to a recent Royal LePage survey, conducted by Burson, 28% of Canadians who currently rent say that, before signing or renewing their current lease, they considered buying a property rather than renting.³ When asked what factors influenced their decision to rent instead, 40% of respondents said they were waiting for property prices to decline, and 29% were waiting for interest rates to decrease further. Respondents could select more than one answer.

New government initiatives could help housing market move ahead

“2026 sees key market fundamentals pointed in the right direction. Recent polls indicate Canadians are satisfied with our political leadership, opening the door for much-needed progress on housing policy,” said Soper. “The 2025 federal budget laid important groundwork – from funding commitments into Build Canada Homes (BCH) to major infrastructure projects – but the real test will be how effectively those measures are executed in the year ahead. If Ottawa follows through, 2026 could be the year we start to see long-promised initiatives turn into real progress for the Canadian real estate industry.”

Introduced in September, BCH is a new government agency responsible for developing, financing and managing affordable housing projects. As part of its first initiative, six public land sites under the Canada Lands Company portfolio have been earmarked to deliver 4,000 factory-built homes.

“2026 will be a transition year for Canada’s housing market, as improved affordability and less competitive conditions continue to favour buyers. We expect activity to build slowly over the next several months, and if the spring market coincides with steadier economic and trade conditions, buyer confidence could strengthen in tandem.

“Canada’s housing market is moving forward again,” Soper concluded. “Improved conditions are drawing buyers back, step by step. The reset is behind us – now we build.”

Read Royal LePage’s 2026 Market Survey Forecast for national and regional insights.

Highlights from the release:

• The aggregate home price in the greater regions of Toronto and Vancouver is expected to decrease 4.5% and 3.5%, respectively, while prices in the Greater Montreal Area are forecast to rise 5.0%.
• Quebec City is once again forecast to see the highest gains among all major regions in 2026, with the aggregate home price expected to rise 12.0%.
• Regina, which continues to see robust demand and constrained supply, is anticipating a 4.0% increase in home prices over the same period. Meanwhile, Ottawa, Calgary, Edmonton, Halifax and Winnipeg are expected to see prices rise no more than 2% in 2026.

Yesterday, the Bank of Canada announced that it has cut the overnight lending rate yet again by 25 basis points to 2.25%. This is the second consecutive rate cut the Bank has made this fall, and the third cut this year.

Though the global economy has held up surprisingly well against the surge in tariffs from the United States, the effects are starting to show, according to the Bank. Trade patterns are shifting, and uncertainty around ongoing tensions is discouraging investment in many countries. In Canada, those pressures were felt in the second quarter, when the economy shrank by 1.6%, due to falling exports and weaker business investment.

“Canadian businesses and households are feeling the consequences of increased US protectionism. It is difficult, and ongoing uncertainty is compounding the difficulty. For many months, we have been stressing that monetary policy cannot undo the damage caused by tariffs. Increased trade friction with the United States means our economy will work less efficiently, with higher costs and less income. Monetary policy can help the economy adjust as long as inflation is well-controlled, but it cannot restore the economy to its pre-tariff path,” said Tiff Macklem, Governor of the Bank of Canada, in a press conference with reporters following the announcement.

“The Bank of Canada is focused on ensuring Canadians continue to have confidence in price stability through this period of global upheaval.”

In September, Canada’s Consumer Price Index (CPI) rose 2.4% year over year, an increase from the 1.9% gain reported in August. While inflation edged higher, the Bank of Canada proceeded with a rate cut, signaling its focus on supporting growth amid signs of economic softness. The unemployment rate held steady in September, following an uptick the previous month, suggesting lingering weakness in the labour market.

“US trade policy remains unpredictable, as events over the weekend reminded us. There continues to be considerable uncertainty, both about US tariffs and their impacts. The range of possible outcomes is wider than usual – we need to be humble about our forecast. If the outlook changes, we are prepared to respond,” said Macklem.

Second fall rate cut a tailwind for homebuyers 

Following a slower-than-usual spring, housing activity in Canada’s largest markets edged higher through the summer months. With borrowing costs decreasing yet again, the stage is set for sidelined buyers to return to the market. 

According to the latest Royal LePage® Home Price Update and Market Forecast, the aggregate¹ price of a home in Canada eased upwards modestly in the second quarter of 2025, increasing 0.3% year over year to $826,400. On a quarter-over-quarter basis, the national aggregate home price decreased by 0.4%.

“Unemployment has stayed manageable, yet job insecurity, particularly among younger Canadians, will persist until Canada reaches a new trade agreement with the United States,” said Phil Soper, president and CEO of Royal LePage, in the report. “While mortgage rates remain above their pandemic lows, the Bank’s recent rate cut is easing pressure on borrowers. Rates are once again in the threes – a level that feels supportive by the standards of the past two decades.”

The Bank of Canada will make its next and final interest rate announcement for 2025 on December 10th.

Read the full October 29th report here. Want to know more about how the overnight lending rate works? Read our explainer on how the Bank of Canada uses this financial tool.

Canada’s housing market may be opening new doors for first-time buyers, thanks to lower borrowing rates, softer prices and more listings to choose from. But, uncertainty in the economy and an abundance of choice have led to a lack of urgency to buy, prompting many young Canadians to take their time before entering the market.  

According to a recent Royal LePage survey, conducted by Burson,¹ 13% of Canadian adults say they are actively working towards the purchase of their first residential property within the next two years. Of this group, a small proportion say they are working towards their first purchase within the next 12 months, while the majority (82%) say they are planning to make a purchase in 12 to 24 months. 

When asked what stage of the purchasing process they are in, more than half (51%) of first-time buyers said they are currently researching neighbourhoods where they can afford to live, 49% are actively browsing online listings, 19% are actively viewing homes listed for sale in person, and 19% have engaged with a real estate agent. Respondents were able to select more than one answer.

“Interest rates are trending lower and prices have stabilized or even softened in some markets, creating favourable conditions for long-awaited entry into home ownership, especially in costly cities like Toronto and Vancouver. Yet, hesitation remains,” said Phil Soper, president and CEO, Royal LePage. “For some, ongoing economic uncertainty, particularly surrounding trade relations with the United States, is prompting them to hold off until there are signs of stability. Buying a home is the biggest financial decision most people will ever make, and first-time buyers naturally want to do so with as much certainty as possible. 

“Others are choosing to wait in hopes of securing a better deal. With the potential for further rate cuts from the Bank of Canada this year, those in no rush to purchase now are taking a methodical approach – building up their savings and deliberately planning their entry into the market when they feel the timing is best for them.”

Financial support continues to flow from family to first-time buyers

While many buyers continue to rely on help from family to make their first home purchase, most do not. When asked if they would receive any financial assistance towards the purchase of their first residential property, more than half (51%) said they would not receive any help. Meanwhile, 41% of first-time buyers said they would. Even as affordability has improved in several markets over the past year, many first-time purchasers continue to rely on financial support to take their first step onto the property ladder.

Among first-time homebuyers who will receive financial support, 29% say it will be in a lump sum with no repayment expected, 27% will receive a loan from family or friends that they will pay back, 28% will have a family member or friend co-sign their mortgage loan, and 26% will receive financial assistance towards their monthly mortgage payments. Respondents were able to select more than one answer.

“Despite improving affordability, many first-time buyers continue to rely on family financial support. This transfer of wealth has become increasingly common, as parents look to give their children the same opportunity for stability and long-term financial growth that they themselves experienced through home ownership. For some buyers, financial contributions from family can make the decisive difference between becoming a homeowner and remaining a tenant,” said Soper.

“However, many lack access to this kind of support, forcing them to adopt more creative and often difficult approaches to saving. Some delay major life milestones, such as marriage or starting a family, in order to prioritize home ownership. Others cut back significantly on discretionary spending, or continue living at home with parents well into adulthood to build up their savings. While determination and careful planning help these buyers reach their goals, the gap between those who receive financial assistance and those who do not highlights the deep affordability challenges in today’s market.”

Detached homes remain the top choice

Despite the hefty price tag, many first-time buyers continue to aspire to own a detached property as their entry into the market. Nearly half (49%) of respondents plan to purchase a single-family detached property as their first home, followed by 26% who intend to buy a condominium or apartment, according to the survey. 

“The dream of a first home often collides with budget reality. While most aspire to own a detached house, affordability often dictates a more modest starting point,” said Soper. “With many employers requiring staff to return to the office, proximity to transit and other amenities has become an increasingly important factor in the search. New buyers also show a clear preference for properties in move-in ready condition, as few have the time or financial flexibility for major renovations.”

Other interesting highlights from the survey:

• More than half (53%) of first-time buyers plan to put at least 20% down on their purchase; while 39% will not and will therefore need to buy mortgage insurance.
• 42% of first-time buyers say they will prioritize the neighbourhood where they want to live, regardless of the distance to their job, while 31% say they will purchase a home based on proximity to their work.
• Finding a home that is move-in ready is the most important non-price related factor for first-time buyers, according to Royal LePage professionals across the country.

Read the full press release and review the data chart for more details: