Canada Existing Home Sales Fall in August as Economic Uncertainty Builds

By Robb M. Stewart

OTTAWA--Activity in Canada's housing market faltered last month, potentially setting the stage for fresh weakness as uncertainty among consumers rises.

Sales of existing homes nationally fell 0.7% from the month before in August, eating into modest gains the previous four months, the Canadian Real Estate Association said Tuesday.

Broadly, there has been little change in activity since May. Residential sales were 6.9% below year-earlier levels, not seasonally adjusted.

At the same time, there was a rebound in new listings in August, with a 3.3% rise in properties for sale after three straight monthly declines earlier in the summer.

"What has changed is the broader economic environment, with the Bank of Canada recently warning of rising inflation risks, along with doubts about the durability of recent economic growth," Shaun Cathcart, the association's senior economist, said.

There had been signs of a slight recovery in the housing market coming into the summer that coincided with a recovery in Canada's jobs market and a pickup in economic growth as household spending has remained resilient and business investment recovered. More recent data, though, suggests gross domestic product stalled in July and consumer-price inflation has two months running been at the top end of the 1%-to-3% window the Bank of Canada aims for.

For borrowers, Cathcart said fixed mortgage rates have been on the rise on the bank of higher bond yields. And for variable home-loan rates, financial markets are pricing in the likelihood the central bank will raise interest rates this year.

"This fresh round of incoming headwinds is expected to dampen the prospects for further housing market momentum heading into 2027," he said.

The dip in sales and rise in new housing supply last month saw the national sales-to-new listings ratio contract slightly to 49.1% from 51.1% in July, which compares with long-term average of 54.7%. Across the country, there were just under 200,000 properties listed for sale at the end of August, in line with the historical average and just 1.4% above a year earlier, the Canadian Real Estate Association said.

The data indicated benchmark house prices, calculated in a similar fashion to the S&P Cotality Case-Shiller National Home Price Index, were unchanged in August. Prices on a monthly basis have remained little changed since the spring, which the association said marks the longest period of price stability since 2024. Compared with a year earlier, prices were down 3% for the smallest drop since last October and following a 3.3% decline in July.

Write to Robb M. Stewart at robb.stewart@wsj.com

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September 15, 2026 05:14 ET (09:14 GMT)