Canada’s housing market showed slight improvement in April, but overall conditions remain weak as oil prices continue fueling inflation and pressuring mortgage rates higher.
Average home prices rose last month at twice their 40-year norm for April on a non-seasonally adjusted basis. However, the more stable benchmark price fell 0.15% month-over-month and 4.2% year-over-year, leaving it 20.5% below its winter 2022 peak.
Canadian home sales increased 0.7% month-over-month in April 2026, marking the first monthly gain in six months. Despite this, sales remained 4% below year-ago levels and about 10% under typical April activity.
Housing inventories also climbed to a six-year high (indicated by the red line above). This means there is more selection for buyers than any other time in this decade.
Affordability for dual-income households remains better than average across much of Canada, a point often overlooked. The national average home price in comparison to a dual-wage salary home ratio remains below the 120-month average of 4.41. This means on average that dual income couples are doing fairly well in this market.
The GDS Ratio is used in mortgage qualification and is the sum of all housing costs including mortgage payment, property taxes, strata fees and heat divided into the income of a borrower(s). From the chart below we can see that the GDS ratio has dropped over 10% since the peak in 2022. It is now closer to more historical norms. This suggests that affordability conditions for housing are not as severe as many headlines suggest.
Overall, with benchmark prices continuing to decline, inventories rising, population shrinking, full-time employment appearing to peak, and the Bank of Canada leaning more toward rate hikes than cuts, a major housing recovery will likely be delayed until late 2026 or 2027. However, affordability conditions remain more stable than many buyers may expect.
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