As of early October 2026, three fresh pieces of Canadian data point the same way. Businesses are more hopeful but not expecting growth, first-time buyers increasingly need a high income to get in, and Bank of Canada research finds that cutting rates can make affordability worse rather than better.
I'm Moe Asgarian, a real estate broker in Toronto, and these three releases change how I would frame a buying or selling decision in the fall of 2026.
Business optimism is up, but nobody is forecasting growth
A new Statistics Canada survey, reported around the start of October 2026, found about 73% of businesses optimistic about their own situation over the coming 12 months, roughly 6 points higher than three months earlier. The sales picture in that same October 2026 survey is thinner. About 68% expected no sales growth at all in the third quarter of 2026, and about 14% expected sales in that quarter to fall. Hiring plans said the same thing: in the October 2026 survey about 84% of firms planned no change in headcount, and only about 8% planned to hire more, down from more than 11% a quarter earlier. Profit expectations were weak too, with about 10% of businesses in that October 2026 survey expecting higher profit over the following 12 months, close to 29% expecting lower profit and about 58% expecting no change at all. Read together, that is hope for stability in the fall of 2026, not an expectation of growth.
Costs and tariffs are still the obstacle
In the same October 2026 survey, about 60% of businesses expected to run into cost related obstacles, and inflation remained the single biggest worry, named by about 42% of them as a main obstacle to operating. Tariffs were adding a layer on top of that. In the year before the October 2026 survey, about 27% of firms had passed tariff driven cost increases on to their customers, and about 30% said at that time that they might raise prices because of tariffs. My read of those two numbers in October 2026 was simple: the cost side of this economy had not settled down yet, and a lot of the price pressure was still ahead rather than behind.
First-time buyers now need a high income, not an average one
Statistics Canada data shows the income of first-time home buyers sitting well above typical household income, and not only in expensive provinces like British Columbia and Ontario. The same pattern turns up in cheaper provinces such as Nova Scotia and New Brunswick. In 2023, across the regions studied, first-time buyer income ran 13% to 36% above median household income. In 2023 the widest gap was in British Columbia, where the median income of first-time buyers was about $145,000, roughly 36% above the median household income for the whole province. In Nova Scotia in 2023, first-time buyers had a median income of about $120,000, about 27% above a typical Nova Scotia household, and in New Brunswick the 2023 gap was about 21%.
The gap is widening, and it clogs the whole chain
The direction is the real story. In British Columbia that gap went from about 26% in 2021 to about 36% in 2023. In New Brunswick it moved from about 6% to more than 20% over the same two years, and in Manitoba it roughly tripled between 2021 and 2023. In 2023, in many of these regions, a first-time buyer's income sat in the top 20% to 30% of earners, which means an ordinary income was no longer enough to buy even an entry level home. That is not only a young buyer's problem. When fewer people can get in at the bottom, the number of transactions falls and the chain breaks, because a seller who wants to move up usually needs someone to buy the home they are leaving. Weak first-time buyer capacity turns into weaker liquidity across the whole Canadian housing market.
Why a rate cut can make affordability worse
New Bank of Canada research, reported in early October 2026, says a lower policy rate does not necessarily improve housing affordability, and under some conditions can make the problem sharper. The reason is speed. When rates fall, borrowing gets cheaper and buyers come into the market quickly, which pushes sales and prices up, and a strong labour market can amplify that. Supply cannot answer at the same pace. That research finds new construction may take about two years after a rate cut before it responds seriously, because permits, planning, marketing and building all take time, and multi-unit projects take longer still. So a cut stimulates demand first and adds supply later. Higher prices and cheaper financing do make new projects more profitable for builders, but that extra supply only arrives as a reaction to the demand that already pushed prices up. A cut can also put pressure on the cost of land, labour and building materials. Earlier Bank of Canada work pointed the same way: more borrowing power often shows up as a higher purchase price rather than a saving for the buyer. The conclusion the researchers reach is that monetary policy is not the right tool for a supply and demand imbalance in housing, and that affordability will not be fixed by rate cuts alone.
If you are weighing a purchase or a sale against all of this, fill out the form at the bottom of this page or book a free consultation. Stay well and take care.
Frequently asked questions
Were Canadian businesses expecting growth in late 2026?
Mostly no. A Statistics Canada survey reported in early October 2026 found about 73% of businesses optimistic about their own situation over the next 12 months, but about 68% expected no sales growth in the third quarter of 2026 and about 14% expected sales to fall. In that same October 2026 survey, about 84% planned no change in headcount.
How much more did first-time home buyers in Canada earn than a typical household?
In 2023, first-time buyer income was 13% to 36% higher than median household income across the regions Statistics Canada studied. British Columbia had the widest 2023 gap, with a first-time buyer median income of about $145,000, roughly 36% above the provincial median. In 2023 Nova Scotia was about 27% higher and New Brunswick about 21% higher.
Does cutting interest rates make housing more affordable in Canada?
Not on its own. Bank of Canada research published by October 2026 says a rate cut stimulates demand quickly while new supply may take about two years to respond, so prices can rise first. Greater borrowing power often shows up as a higher purchase price instead of a saving, which is why the researchers say monetary policy is not the right tool for a housing supply and demand imbalance.