The Canadian Real Estate Association (CREA) attributes the decline in housing sales in January to the harsh winter conditions. According to CREA’s latest report, national housing sales dropped by 5.8% compared to the previous month.

Shaun Cathcart, CREA’s senior economist, explained that the slow January was most pronounced in parts of Ontario, where severe winter weather affected transactions. He noted that the impact was significant in central and southwestern Ontario, areas hit by a major storm in late January that hindered mobility for many residents.

Real estate agent Joe Ferrante from the Hamilton area suggested that extreme weather may have deterred potential buyers from attending house viewings, although he believes the slowdown in transactions is an extension of the sluggish late 2025 market trend.

Despite the challenging month, CREA remains optimistic about its 2026 forecast and sees no reason to revise it based on January’s performance, as long as there are no major disruptions like another severe snowstorm.

The inventory of available housing in Canada at the end of January was approximately 4.9 months, aligning closely with the typical five-month inventory level that CREA considers as a measure of market balance.

While some buyers are anticipating lower interest rates before making a purchase, Cathcart clarified that there are no imminent changes in interest rates following the Bank of Canada’s adjustment to 2.25% at the end of October, which has been maintained since then.

CREA’s projection for 2026 anticipates a modest 2.8% increase in the national average home price, as indicated by the national composite MLS home price index, which stood at $652,941 in January, down by 2.6% from the previous year. The association includes all types of residential properties in this calculation, including homes and condos.

Regionally, CREA reported year-over-year price decreases in British Columbia, Alberta, and Ontario, which were offset by gains in other provinces.