CMHC report predicts sluggish year for home sales and new construction in Windsor area

The housing market in the Windsor area is anticipated to experience a sluggish year according to the Canada Mortgage and Housing Corporation (CMHC). Southern Ontario’s Lead Economist, Anthony Passarelli, attributes this slow year to economic uncertainty stemming from Canada’s trade relations with the United States, which has the potential to impact consumer confidence and deter individuals from significant purchases, such as homes, as well as dissuade builders from engaging in new construction projects.

Passarelli predicts that 2026 will see a deceleration in home sales and construction activities in the Windsor market due to the prevailing uncertainty. The upcoming renegotiation of the Canada-United States-Mexico Agreement (CUSMA) is anticipated to further contribute to this sense of unease. The CMHC’s Housing Market Outlook for 2026 projects that there will be around 5,800 home sales in the Windsor area this year, with an average selling price of $575,000. This marks a slight increase from the 5,402 homes sold in 2025, with an average price of $559,168.

The report also indicates a projected decline in total housing starts in the Windsor Census Metropolitan Area (CMA) for 2026, signaling continued weakness in both ground-oriented and condominium apartment construction activities. Factors such as ample resale inventory and evolving migration patterns are further dampening the demand for homeownership in the region.

Passarelli emphasizes that the rental construction sector is expected to drive new construction projects in the coming years, with substantial government backing. This support is partly due to the softness observed in the low-rise, ground-oriented housing and condo markets. Consequently, a shift towards a buyer’s market condition for resale homes is foreseen, providing prospective buyers with an array of options to choose from.

The CMHC anticipates an increase in the vacancy rate for purpose-built rental apartments in the forecast period, fueled by dwindling numbers of work-permit and study-permit holders who historically have driven rental demand in Windsor. While the average rent for a 2-bedroom unit is projected to grow steadily, asking rents might experience a decline as vacancies rise, yet rent adjustments during tenant turnover will sustain an upward trajectory in the overall average rent paid.

Looking ahead to 2027 and 2028, the report suggests that as the broader economic landscape stabilizes, there will likely be a resurgence in ground-oriented housing starts. This revitalization is expected to manifest in outer areas of the CMA, such as Tecumseh and Amherstburg, as greater demand for homeownership fuels new construction endeavors in these regions.