Monthly Market Update
Monthly Market Update
August 2026
As we move through the summer months, there are encouraging signs that Canada's economy is beginning to regain its footing. While uncertainty remains, recent economic data suggests that conditions are improving, and that is good news for both buyers and sellers.
Economic Confidence Improving
• Canada's economy is showing stronger-than-expected growth in the second quarter of 2026, driven largely by increased oil and gas production. Statistics Canada estimates that the economy expanded at an annualized rate of 3.4%, exceeding the Bank of Canada's forecast of 2.5%. This rebound follows a period of economic stagnation caused by trade tensions, slower population growth, and concerns about inflation.
Consumer confidence is also improving. The Bloomberg Nanos Canadian Confidence Index has climbed steadily since April, indicating that Canadians are becoming less pessimistic about the economy and more optimistic about the months ahead.
The Bank of Canada has maintained its policy interest rate at 2.25% for the sixth consecutive meeting, expressing confidence that economic growth will continue through the second half of the year while inflation pressures gradually ease.
The Housing Market: Patience vs. Opportunity
• Many homeowners are waiting for higher prices, lower mortgage rates, or clearer signs of a market recovery before listing their homes. However, real estate decisions are often better based on personal circumstances rather than waiting for the "perfect" market conditions.
We’ve seen markets rise, cool, and recover in ways few could have predicted. What remains constant is that life continues regardless of market conditions. People still relocate, retire, downsize, upsize, and move closer to family and friends.
Three Reasons Waiting Could Be Costly:
1. Higher Selling Prices May Mean Higher Purchase Prices
While waiting may result in a higher sale price for your current home, it may also mean paying more for the property you intend to purchase. The overall cost of the move is often more important than maximizing one side of the transaction.
2. Ownership Costs Continue to Add Up
Mortgage payments, property taxes, insurance, utilities, strata fees, and maintenance costs don't stop while waiting for a stronger market. These expenses can significantly impact the financial benefit of delaying a sale.
3. More Competition May Be Coming
Many homeowners are watching the same economic indicators and waiting for better conditions. If confidence improves, a large number of sellers may enter the market at the same time, creating more competition and making it harder for individual properties to stand out.
CMHC Forecast: A Slow Recovery Ahead
The Canada Mortgage and Housing Corporation (CMHC) now expects Canada's housing market to contract in 2026, with lower sales volumes, softer prices, and fewer housing starts. Weak demand, affordability challenges, slower population growth, and ongoing economic uncertainty continue to weigh on the market.
British Columbia and Ontario are expected to remain challenged by affordability concerns and slower activity, while the Prairie provinces are forecast to lead the country in sales and price growth.
The good news is that CMHC expects conditions to gradually improve in 2027 and 2028 as economic growth strengthens and consumer confidence returns.
Rental Market Showing Signs of Relief
Rental markets are also beginning to stabilize. Increased housing supply and slower population growth are expected to ease rent increases in major markets. However, affordability remains a significant challenge for many Canadians, with average asking rents continuing to exceed what most renters can comfortably afford.
Community Corner
A heartfelt thank you to everyone who joined us for our recent social gathering at Prohibition Vineyard & Winery. We were fortunate to enjoy a beautiful summer day, great company, and plenty of laughter. It was wonderful to connect with friends, clients, and members of our community in such a relaxed setting.
A special mention goes to the winery's Sangria Slushy, which quickly became the star of the afternoon and was a hit with everyone who tried it! Thank you again to all who attended and helped make the event such a memorable success. We look forward to seeing you at our next gathering.
Final Thoughts
While headlines often focus on uncertainty, there are several encouraging signs emerging. Economic growth is improving, consumer confidence is recovering, inflation is becoming more manageable, and interest rates have remained stable.
The real estate market remains highly local. National trends may influence sentiment, but neighbourhood-by-neighbourhood conditions often tell a very different story. Whether you are considering buying, selling, downsizing, investing, or simply exploring your options, decisions should be based on your personal goals, timing, and financial situation rather than waiting for the perfect headline.
As always, if you would like an update on the current value of your home or to discuss your real estate plans, we would be happy to help.
Helping clients on the Saanich Peninsula and across Greater Victoria make confident, informed decisions in every market.
Michele Holmes, Mark Rice PREC and Eric Smith PREC Coldwell Banker Oceanside Real Estate