Ontario housing market set for modest rebound in 2027: Desjardins report
TORONTO — A new report says Ontario's housing market is expected to improve "modestly" next year as favourable economic conditions help push buyers off the sidelines, though higher borrowing costs could dull the extent of the rebound.
A Desjardins report released on October 21, 2026 predicts a modest recovery for Ontario's housing market in 2027. Senior economist Kari Norman describes the province's housing sector as "weak" despite recent improvements in affordability, increased buyer options, and easing rental conditions. The report anticipates existing home sales to increase by nearly five percent in 2027 compared to the current year, but the growth will still fall short of historical averages. Average home prices are expected to rise by 2.4 percent in 2027, also below long-term norms.
The report highlights that higher borrowing costs, including anticipated rate hikes by the Bank of Canada, will dampen affordability gains stemming from recent home price declines and the rise in disposable incomes. This will also increase construction financing costs. Housing starts are projected to grow by around six percent to approximately 65,000 units in 2027, still significantly below the levels observed in 2021 and 2022.
Rental conditions are expected to remain relatively balanced as new condominium and purpose-built rental completions add supply, albeit at a time when population growth is anticipated to be weak.
Written by urgent.news from CityNews's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
