Sylvie Theriault

Summary Home transactions totalled 470.3K in 2025, a 1.9% decline compared to 2024 but a stronger year than 2023. On a monthly basis, transactions were down 2.7% from November to December, a third decline in four months that is difficult to explain given recent interest rate cuts and improvements in the labour market. New listings declined by 2.0% from November to December, a fourth consecutive decline. Active listings edged down 0.5% from November to December, the fifth decline in six months. Market conditions loosened slightly during the month but continued to indicate a balanced market compared to the historical average. Still, the balanced market conditions at the national level largely reflect soft conditions in Ontario and B.C., while markets in all other provinces continue to favour sellers. Housing starts ended 2025 on a strong note, rising for the second consecutive month to reach 282.4K, their highest level in five months and well above consensus expectations. In 2025, there was a total of 259.0K housing starts nationwide, an increase of 5.6% compared to 2024. This makes it the third-strongest year on record for the new construction market after 2021 and 2022. The TeranetNational Bank Composite National House Price Index remained stable from November to December after seasonal adjustment. Six of the eleven CMAs included in the index recorded increases: Ottawa-Gatineau (+2.9%), Edmonton (+1.2%), Winnipeg (+1.1%), Calgary (+0.7%), Vancouver (+0.2%) and Quebec City (+0.1%). Conversely, prices declined in Hamilton (-1.8%), Halifax (- 1.0%), Victoria (-0.8%), Toronto (-0.5%) and Montreal (-0.2%). From December 2024 to December 2025, the composite index declined by 3.5%. https://www.nbc.ca/content/dam/bnc/taux-analyses/analyse-eco/logement/economic-news-resale-market.pdf

On Wednesday, January 28, 2026, the Bank of Canada held its target for the overnight lending rate steady at 2.25% for the second consecutive time, a move widely expected by analysts. As forecast by the Bank, Canadas Gross Domestic Product (GDP) marked robust growth in the third quarter of 2025 but is expected to be flat in final quarter of the year, when that data is released. Exports to the United States are acting as a drag on economic growth due to ongoing tariffs. Meanwhile, the Bank noted that although employment numbers have picked up in recent months, the unemployment rate remains elevated, particularly for younger people. Its survey of businesses also reveals few of them intend to increase their workforces. The Bank projects economic growth of only 1.1% in 2026, as slower population growth and adjustments to U.S. protectionism act as headwinds on Canadas economy. It also referenced the upcoming review of the Canada-US-Mexico (CUSMA) agreement as one of the major sources of uncertainty its watching this year. The Consumer Price Index (CPI) inflation has been slowing recently and is trending closer to the Banks 2% target. Although CPI inflation is expected to stay near that level over the projected horizon, the Bank noted in its January Monetary Policy Report (MPR) inflation for items such as food services and rent remain well above their long-term averages. https://www.crea.ca/media-hub/news/bank-of-canada-maintains-policy-rate-at-2-25-2/