Sellers made a strong entrance into the 2026 housing market. While home sales slowed compared to December, a surge of fresh listings signaled renewed confidence among homeowners, according to the latest report from the Canadian Real Estate Association. The influx of new supply has already begun to shift market dynamics, setting the tone for the early months of the year.
The number of home sales recorded over Canadian MLS® Systems fell 5.8% on a month over month basis in January. At the same time, new listings surged 7.3% compared to December as sellers appeared eager to kick off the year. The early year momentum from sellers suggests confidence and readiness to move, even as buyers showed slightly more restraint.
“The monthly decline in national home sales was driven primarily by less activity in the Greater Golden Horseshoe and Southwestern Ontario, suggesting that the story was probably more about a historic winter storm than a downshift in demand,” said Shaun Cathcart, CREA’s Senior Economist, in the report. “Notwithstanding the chilly start to the year, we continue to expect 2026 will ultimately be defined by pent-up demand from first-time buyers finally seeing a chance to enter the market.”
Major cities lead the supply surge
There were 140,680 properties listed for sale on all Canadian MLS® Systems at the end of January 2026. That figure is 4.5% higher than a year earlier, although still 11.4% below the long term average for this time of year.
Months of inventory rose to 4.9 months nationally, up from 4.6 months at the end of December. The long term average for this measure is five months. Historically, a seller’s market would sit below 3.6 months of inventory, while a buyer’s market would be above 6.4 months. January’s activity puts the market very close to long term norms, marking a notable transition toward more balanced conditions.
The increase in new listings was broad based, with roughly two-thirds of local markets reporting gains. The strongest activity was concentrated in Montreal, Quebec City, Calgary, Greater Vancouver, and Victoria, where sellers came out in force.
In contrast, Central and Southwestern Ontario were much quieter. Many markets in those regions recorded declines in both sales and new listings. Winter weather appears to have played a role, suppressing both demand and supply in those areas.
“We always say all real estate is local, and on occasion, including this January, that can mean the impact of local weather on the market,” said Valérie Paquin, CREA’s Chair, in the report. “In a repeat of 2025, new listings are showing up early to start the year, so sellers are eager to get going, but we may have to wait a bit longer to see how buyers react.”
Market balance shifts in January
With a sizable increase in listings and a sharp slowdown in sales, the national sales-to-new-listings ratio dropped to 45% in January. That is down from 51.3% at the end of 2025 and below the long term average of 54.8%.
A ratio between 45% and 65% is generally considered consistent with balanced housing market conditions. January’s reading places the market right at the lower edge of that balanced range, signaling a clear shift from the tighter conditions seen late last year.
Prices adjust as supply expands
With more homes available and demand softening, prices edged lower in January. The National Composite MLS® Home Price Index declined 0.9% on a month over month basis.
On a non-seasonally-adjusted basis, the index was down 4.9% compared to January 2025. The non seasonally adjusted national average home price came in at $652,941, dipping 2.6% year over year.
Regionally, British Columbia, Alberta, and Ontario continue to show year over year price declines, offsetting gains in other provinces. Some cities experienced particularly sharp adjustments, with double digit declines in Hamilton Burlington and Oakville Milton. At the same time, double digit gains were recorded in Sudbury, Quebec City, and St. John’s, Newfoundland, highlighting the uneven nature of price trends across the country.
