CMHC Expects Prices to Dip Before They Recover. What Does That Mean if You Own in Etobicoke?

Market Insight Dave Dubbin July 30, 2026

CMHC released its 2026 Housing Market Outlook Mid-Year Update on July 22, and the short version goes like this: home prices across Canada are expected to slip a little further this year, then return to modest growth in 2027 and 2028. Sales recover gradually, but stay below the levels we all got used to over the past decade. If you own a home in Etobicoke, the headline sounds gloomier than the details actually are. Here is what the report says, and what we think it means on the ground in the west end.

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What CMHC actually said

The mid-year update covers the national picture plus forecasts for 18 markets. The thread running through it is that demand stays subdued through 2026. CMHC points to economic uncertainty, slower population growth, borrowing costs that are still high by recent standards, and modest income growth. Price reductions so far have not been enough to pull sidelined buyers back in. Their base case has prices declining through 2026, then growing modestly in 2027 and 2028.

Ontario gets the cautious end of the forecast

Not every region reads the same. The Prairies are expected to lead on sales and price growth. Ontario and B.C. get the cautious language, with affordability challenges and weaker activity expected to hang around longer. The report also expects housing starts to keep falling as builders respond to weak demand and elevated inventories, with condo construction in Ontario singled out as particularly slow. Remember that one. Homes not started in 2026 are homes not finished in 2028, and that tends to matter for prices down the road.

If you are selling this year

A flat to slightly soft forecast does not mean nothing is selling. TRREB's June numbers showed sales climbing while new listings tightened, and we are seeing well priced Etobicoke homes find their buyers without drama. The catch is the word priced. In a market like this the first two weeks carry most of the weight, and a list price built on a 2022 memory will sit. Price to today, present the home properly, and the forecast becomes background noise.

Weighing a move this year? These three are worth ten minutes:

If you are buying

A forecast that says prices dip this year and recover next is the polite way of saying the window is open. The Bank of Canada has held its rate at 2.25 percent since December, there is more choice on the market than there has been in years, and sellers are negotiating. We would not try to call the exact bottom. Nobody rings a bell. Buy on the monthly payment you can live with, not on a prediction, and let the 2027 recovery be a bonus rather than the plan.

Condos, renters, and landlords

CMHC expects rental conditions to keep easing, with vacancy rising in Toronto and growth in asking rents slowing. If you own a rental condo in Liberty Village or down at Humber Bay Shores, that matches what we wrote in our rent checks earlier this month, and it argues for keeping a good tenant over chasing top dollar on turnover. The flip side is that same stalled condo construction. Fewer cranes today usually means a tighter rental market a few years out, which is worth remembering before selling a unit that carries itself.

A forecast is a weather report

One last thing worth saying. CMHC is forecasting the whole country, and even its Toronto numbers blend hundreds of neighbourhoods. Etobicoke pockets rarely move in lockstep with the averages. Detached streets in Markland Wood and condo towers on Lake Shore can have completely different years. We read the reports so you do not have to, but when it is time to make a decision, we would rather show you the last ninety days on your street.