{"id":1326,"date":"2025-02-19T01:11:58","date_gmt":"2025-02-19T01:11:58","guid":{"rendered":"https:\/\/valery.ca\/blog\/?p=1326"},"modified":"2025-08-29T19:25:01","modified_gmt":"2025-08-29T19:25:01","slug":"can-canadian-real-estate-survive-a-trade-war","status":"publish","type":"post","link":"https:\/\/valery.ca\/blog\/can-canadian-real-estate-survive-a-trade-war\/","title":{"rendered":"Can Canadian real estate survive a trade war?"},"content":{"rendered":"\n<h2 class=\"wp-block-heading has-large-font-size\" id=\"canadas-housing-market-braces-for-impact-as-rising-supply-meets-trade-war-fears\">Canada\u2019s Housing Market Braces for Impact as Rising Supply Meets Trade War Fears<\/h2>\n\n\n\n<div class=\"wp-block-rank-math-toc-block\" id=\"rank-math-toc\"><h2>Table of Contents<\/h2><nav><ul><li><a href=\"#canadas-housing-market-braces-for-impact-as-rising-supply-meets-trade-war-fears\">Canada\u2019s Housing Market Braces for Impact as Rising Supply Meets Trade War Fears<\/a><\/li><li><a href=\"#a-historic-surge-in-listings-a-slowdown-in-sales\">A Historic Surge in Listings, A Slowdown in Sales<\/a><ul><li><a href=\"#unprecedented-inventory-growth\">Unprecedented Inventory Growth<\/a><\/li><li><a href=\"#sales-take-a-hit-amid-economic-jitters\">Sales Take a Hit Amid Economic Jitters<\/a><\/li><li><a href=\"#prices-hold-their-ground-for-now\">Prices Hold Their Ground\u2014for Now<\/a><\/li><\/ul><\/li><li><a href=\"#the-big-unknown-how-will-trumps-tariffs-impact-real-estate\">The Big Unknown: How Will Trump\u2019s Tariffs Impact Canadian Real Estate?<\/a><ul><li><a href=\"#a-game-changer-for-the-canadian-economy\">A Game-Changer for the Canadian Economy<\/a><\/li><li><a href=\"#the-spring-rebound-is-coming-but-will-it-be-enough\">The Spring Rebound is Coming\u2014But Will It Be Enough?<\/a><\/li><li><a href=\"#not-every-market-will-recover-equally\">Not Every Market Will Recover Equally<\/a><\/li><\/ul><\/li><li><a href=\"#what-buyers-and-sellers-need-to-know\">What Buyers and Sellers Need to Know<\/a><ul><li><a href=\"#for-buyers\">For Buyers<\/a><\/li><li><a href=\"#for-sellers\">For Sellers<\/a><\/li><\/ul><\/li><li><a href=\"#final-thoughts-a-market-on-the-edge\">Final Thoughts: A Market on the Edge<\/a><\/li><\/ul><\/nav><\/div>\n\n\n\n<p>Something has shifted in Canadian real estate housing market. This shouldn\u2019t come as a surprise, given something has <em>certainly<\/em> shifted at a global geopolitically level. You might even call it a \u201ctarrifying\u201d headwind for Canada&#8217;s real estate market.&nbsp;<\/p>\n\n\n\n<p>For years, supply was tight, and homebuyers outnumbered sellers in Canada\u2019s real estate market. But as 2025 begins, the landscape looks strikingly different. New listings are pouring into the market at an extraordinary pace, while sales are faltering under the weight of mounting economic uncertainty. As is tradition, when facing an unknown future, Canada\u2019s real estate market has decided to hit the \u201cpause button\u201d. It is not uncommon to see the market take a breath when we\u2019re facing an historic election, a pandemic, or a changing economy. Today\u2019s trade war is no different.<br><br>Compounding the turbulence, President Trump\u2019s proposed tariffs on Canadian exports loom over key industries, raising concerns about potential job losses, wage stagnation, and the broader impact on housing demand. Though the Canadian-specific targeting has been temporarily postponed, Trump\u2019s global target on steel and aluminum has Canada written all over it:<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"624\" height=\"624\" src=\"https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog.png\" alt=\"\" class=\"wp-image-1327\" srcset=\"https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog.png 624w, https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-300x300.png 300w, https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-150x150.png 150w, https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-226x226.png 226w\" sizes=\"(max-width: 624px) 100vw, 624px\" \/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"a-historic-surge-in-listings-a-slowdown-in-sales\"><strong>A Historic Surge in Listings, A Slowdown in Sales<\/strong><\/h2>\n\n\n\n<p>For buyers willing to stomach the risk, this could be the window of opportunity they\u2019ve been waiting for\u2014more choices and lower interest rates make financing more attractive. But for sellers, it\u2019s a wake-up call. A market that once favored them is now shifting toward balance\u2014or even softness in some areas. Yet, the full impact of these shifting dynamics remains uncertain, as much depends on the outcome of the postponed tariffs and their potential ripple effects across the economy.<\/p>\n\n\n\n<p>CREA\u2019s latest market data gives us a clearer picture of what\u2019s ahead. Let\u2019s break it down.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"unprecedented-inventory-growth\"><strong>Unprecedented Inventory Growth<\/strong><\/h3>\n\n\n\n<p>One of the biggest surprises of early 2025 has been the flood of new listings. Figures for January reveal that new supply jumped 11 per cent compared to December 2024\u2014the largest seasonally adjusted increase since the late 1980s (excluding pandemic-era fluctuations).What does this mean? It\u2019s a clear sign that more homeowners are choosing to sell, possibly in anticipation of weaker market conditions. In high-priced regions like British Columbia and Ontario, where supply had been tightening in 2024, this sudden increase in listings is cooling price pressures and shifting negotiating power back toward buyers.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"624\" height=\"427\" src=\"https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tarriffs-valery-blog-2.png\" alt=\"\" class=\"wp-image-1328\" srcset=\"https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tarriffs-valery-blog-2.png 624w, https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tarriffs-valery-blog-2-300x205.png 300w, https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tarriffs-valery-blog-2-330x226.png 330w\" sizes=\"(max-width: 624px) 100vw, 624px\" \/><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"sales-take-a-hit-amid-economic-jitters\"><strong>Sales Take a Hit Amid Economic Jitters<\/strong><\/h3>\n\n\n\n<p>While inventory rose, sales did not follow suit. Instead, national home sales fell 3.3 percent month-over-month, with the most dramatic drop occurring in the last week of January. The timing suggests that buyers pulled back due to growing concerns over Trump\u2019s tariff policies, which many fear could destabilize Canada\u2019s economy. However, it\u2019s not all bad news. Compared to January 2024, actual sales were up 2.9 per cent, meaning demand is still present\u2014just hesitant. Buyers aren\u2019t disappearing, but they are waiting to see where the economy lands before making big moves.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"624\" height=\"427\" src=\"https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-3.png\" alt=\"\" class=\"wp-image-1329\" srcset=\"https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-3.png 624w, https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-3-300x205.png 300w, https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-3-330x226.png 330w\" sizes=\"(max-width: 624px) 100vw, 624px\" \/><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"prices-hold-their-ground-for-now\"><strong>Prices Hold Their Ground\u2014for Now<\/strong><\/h3>\n\n\n\n<p>Despite rising inventory and weaker sales, home prices have remained surprisingly stable:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The MLS\u00ae Home Price Index (HPI) barely changed month-over-month (-0.08 per cent) and year-over-year (+0.07 per cent).<\/li>\n\n\n\n<li>The national average home price hit $670,064, up 1.1 per cent from January 2024.<\/li>\n<\/ul>\n\n\n\n<p>But not all regions are experiencing the same trends:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>British Columbia &amp; Ontario:<\/strong> A surge in supply is creating a softer pricing environment, making these regions more favorable for buyers.<\/li>\n\n\n\n<li><strong>Alberta &amp; Saskatchewan:<\/strong> With inventories at near 20-year lows, prices continue to rise despite economic uncertainty.<\/li>\n\n\n\n<li><strong>Quebec &amp; Atlantic Canada:<\/strong> These markets are expected to see both price and sales growth in 2025, making them the country\u2019s most balanced housing sectors.<\/li>\n<\/ul>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"624\" height=\"427\" src=\"https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-4.png\" alt=\"\" class=\"wp-image-1330\" srcset=\"https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-4.png 624w, https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-4-300x205.png 300w, https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-4-330x226.png 330w\" sizes=\"(max-width: 624px) 100vw, 624px\" \/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"the-big-unknown-how-will-trumps-tariffs-impact-real-estate\"><strong>The Big Unknown: How Will Trump\u2019s Tariffs Impact Canadian Real Estate?<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"a-game-changer-for-the-canadian-economy\"><strong>A Game-Changer for the Canadian Economy<\/strong><\/h3>\n\n\n\n<p>Just as Canada\u2019s housing market was poised for recovery, a new storm has appeared on the horizon: Trump\u2019s tariff policy for Canada.<\/p>\n\n\n\n<p>The U.S. government has proposed a 25 per cent tariff on all Canadian non-energy exports and a 10 per cent tariff on Canadian energy exports, though implementation has been postponed by 30 days. If implemented, this policy shift could disrupt key industries, hamper trade, and increase the risk of an economic downturn.<\/p>\n\n\n\n<p>Some cities will feel the effects more than others. New research from the Canadian Chamber of Commerce\u2019s Business Data Lab has identified the regions most vulnerable to these tariffs. The most exposed markets are:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Saint John, New Brunswick<\/strong> \u2013 Due to its heavy dependence on crude oil exports from the Irving Oil Refinery.<\/li>\n\n\n\n<li><strong>Calgary, Alberta<\/strong> \u2013 A major energy hub exporting crude oil, natural gas, and beef.<\/li>\n\n\n\n<li><strong>Southwestern Ontario (Windsor, Kitchener-Cambridge-Waterloo, Brantford, Guelph)<\/strong> \u2013 These cities are deeply tied to the auto and manufacturing industries, which rely heavily on cross-border trade with the U.S.<\/li>\n\n\n\n<li><strong>Hamilton, Ontario<\/strong> \u2013 As Canada\u2019s steel capital, Hamilton\u2019s economy is at risk if tariffs disrupt steel exports.<\/li>\n\n\n\n<li><strong>Quebec\u2019s aluminum and forestry hubs (Saguenay, Trois-Rivi\u00e8res, Drummondville)<\/strong> \u2013 Key exporters of aluminum and forestry products.<\/li>\n<\/ul>\n\n\n\n<p>If these industries slow down, it could impact jobs, wages, and housing demand in these cities. Simply put, these tariffs could mean fewer buyers in affected regions, leading to longer selling times and price stagnation or declines.<br><br>The table below, from the same research, provides a detailed ranking of Canadian cities most vulnerable to the proposed U.S. tariffs.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"624\" height=\"279\" src=\"https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-5.jpg\" alt=\"graph showing the tariff exposure index as per city for the canadian real estate housing market\" class=\"wp-image-1331\" srcset=\"https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-5.jpg 624w, https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-5-300x134.jpg 300w, https:\/\/valery.ca\/blog\/wp-content\/uploads\/2025\/02\/tariffs-valery-blog-5-366x164.jpg 366w\" sizes=\"(max-width: 624px) 100vw, 624px\" \/><\/figure>\n\n\n\n<p style=\"font-size:28px\"><strong>What\u2019s Next for the Canadian Real Estate Housing Market in 2025?<\/strong><\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"the-spring-rebound-is-coming-but-will-it-be-enough\"><strong>The Spring Rebound is Coming\u2014But Will It Be Enough?<\/strong><\/h3>\n\n\n\n<p>Despite economic concerns, CREA still expects <strong>a strong spring market<\/strong>, driven by:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Lower borrowing costs<\/strong> \u2013 Mortgage rates are falling, drawing more buyers into the market.<\/li>\n\n\n\n<li><strong>Pent-up demand<\/strong> \u2013 Many buyers have been waiting for prices to stabilize before re-entering.<\/li>\n<\/ul>\n\n\n\n<p>According to CREA, an estimated 532,704 homes will sell in 2025, an 8.6 per cent increase from 2024. Prices are expected to rise 4.7 per cent this year, reaching $722,221 by year-end.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"not-every-market-will-recover-equally\"><strong>Not Every Market Will Recover Equally<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>British Columbia &amp; Ontario:<\/strong> Sales should rebound, but higher inventory will keep prices in check.<\/li>\n\n\n\n<li><strong>Alberta &amp; Saskatchewan:<\/strong> With sales already near record highs in 2024 and inventory at 20-year lows, prices in these provinces are expected to climb faster than sales.<\/li>\n\n\n\n<li><strong>Quebec &amp; Atlantic Canada:<\/strong> Predicted to see both price and sales growth.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"what-buyers-and-sellers-need-to-know\"><strong>What Buyers and Sellers Need to Know<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"for-buyers\"><strong>For Buyers<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>More Listings, More Choices<\/strong> \u2013 Buyers finally have leverage in many regions.<\/li>\n\n\n\n<li><strong>Lock in Rates Now<\/strong> \u2013 Mortgage rates are dropping, and delaying could cost more in the long run.<\/li>\n\n\n\n<li><strong>Watch the Economy<\/strong> \u2013 If tariffs cause widespread job losses, it could create a buyer\u2019s market later in the year.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"for-sellers\"><strong>For Sellers<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>More Competition Means Smarter Pricing<\/strong> \u2013 Overpricing will lead to stagnation, especially in high-inventory regions.<\/li>\n\n\n\n<li><strong>Consider Selling Before a Potential Slowdown<\/strong> \u2013 If economic fears grow, waiting could mean a tougher market.<\/li>\n\n\n\n<li><strong>Regional Differences Matter<\/strong> \u2013 Some Canadian real estate markets (like Alberta) still favor sellers, while others (Ontario) are shifting toward buyers.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"final-thoughts-a-market-on-the-edge\"><strong>Final Thoughts: A Market on the Edge<\/strong><\/h2>\n\n\n\n<p>The Canadian real estate housing market in 2025 is no longer a one-way street. Buyers and sellers must adapt to new realities, from shifting supply-demand dynamics to the potential fallout of a major trade war.<\/p>\n\n\n\n<p>For some, this year will bring opportunity; for others, waiting may be the preferred choice.<\/p>\n\n\n\n<p>How the Canadian real estate market unfolds will depend on a delicate balance of forces\u2014interest rates, inventory levels, and the broader economic impact of U.S. trade policies. While the housing sector has shown resilience before, this time, the uncertainty runs deeper, and its effects may take longer to play out.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Canada\u2019s Housing Market Braces for Impact as Rising Supply Meets Trade War Fears Something has shifted in Canadian real estate [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":1341,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rank_math_lock_modified_date":false,"footnotes":""},"categories":[1],"tags":[112,124,123],"class_list":["post-1326","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized","tag-canadian-real-estate","tag-canadas-housing-market","tag-trump-tariffs"],"mtags":[{"term_id":112,"name":"canadian real estate","slug":"canadian-real-estate","term_group":0,"term_taxonomy_id":112,"taxonomy":"post_tag","description":"","parent":0,"count":12,"filter":"raw"},{"term_id":124,"name":"canada's housing market","slug":"canadas-housing-market","term_group":0,"term_taxonomy_id":124,"taxonomy":"post_tag","description":"","parent":0,"count":2,"filter":"raw"},{"term_id":123,"name":"trump tariffs","slug":"trump-tariffs","term_group":0,"term_taxonomy_id":123,"taxonomy":"post_tag","description":"","parent":0,"count":1,"filter":"raw"}],"featured_image_thumbnail_url":false,"_links":{"self":[{"href":"https:\/\/valery.ca\/blog\/wp-json\/wp\/v2\/posts\/1326"}],"collection":[{"href":"https:\/\/valery.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/valery.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/valery.ca\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/valery.ca\/blog\/wp-json\/wp\/v2\/comments?post=1326"}],"version-history":[{"count":15,"href":"https:\/\/valery.ca\/blog\/wp-json\/wp\/v2\/posts\/1326\/revisions"}],"predecessor-version":[{"id":19537,"href":"https:\/\/valery.ca\/blog\/wp-json\/wp\/v2\/posts\/1326\/revisions\/19537"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/valery.ca\/blog\/wp-json\/wp\/v2\/media\/1341"}],"wp:attachment":[{"href":"https:\/\/valery.ca\/blog\/wp-json\/wp\/v2\/media?parent=1326"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/valery.ca\/blog\/wp-json\/wp\/v2\/categories?post=1326"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/valery.ca\/blog\/wp-json\/wp\/v2\/tags?post=1326"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}