Three Months Later: How Have Tariffs Affected the Canadian Housing Market
Monday, June 30, 2025
By Shaun Bernstein for REALTOR.ca
Keeping track of tariffs in 2025 can feel like playing “follow the bouncing ball.” Are they on or are they off again? With potential tariffs coming to some of Canada’s major industries that impact the housing market—steel, lumber, and energy for example—it’s impossible to say with certainty what the end result of these tariffs will be.
Now, months into U.S. President Donald Trump’s administration, the picture is slightly clearer. While tariffs still represent an uncertainty in the market, we have a greater understanding of their economic impact and what that looks like—at least for now.
Canadian home sales feeling the effects of tariffs
Shaun Cathcart, Director and Senior Economist of Housing Data and Market Analysis at the Canadian Real Estate Association (CREA), notes the data shows a direct link in the change in daily sales between last year and this one starting at the fourth week of January, right around the time President Trump took office. That week marked the initial announcement of tariffs, and from Cathcart’s purview, it sent buyers “scurrying to the sidelines.”
“We definitely saw the uncertainty play out in the housing market initially where everyone pulled back,” says Cathcart, as it was unclear how tariffs would impact the greater economy. There were predictions of more than one million jobs that may be lost. However, the following months, and the frequent changes and fluctuations in domestic and foreign policy, have shown those predictions were more extreme than reality.
Now, it seems as though the tariffs are having a more regional impact than they are a nationwide one. Cathcart notes the targeting of certain industry sectors —automotive, energy, steel and aluminum, lumber, etc.—is hitting certain markets harder than others, but there is some optimism for a nationwide outlook.
“Buyers look like they’re starting to come back in May,” he explains, although markets dependent on those noted industries will still likely feel a blow.
Cathcart also notes inflation numbers are tricky, and a quick glance may not paint a full picture. He also notes that while year-over-year inflation will make for a weaker headline in 2025 because of the removal of the carbon tax, inflation in other key areas is actually on the rise. “Grocery and food is what really hits people’s pocketbooks,” he notes. While the Bank of Canada was once predicted to lower the base interest rate again this summer, that is no longer a surefire bet after its decision to keep the policy rate at 2.75% on June 4.
What Canadian cities are impacted most?
In Windsor, Ontario,for example, which is highly dependent on the city’s automotive industry, the market is certainly feeling the pinch. Don Merrifield Jr., a salesperson and REALTOR® with RE/MAX Preferred Realty in Windsor, Ontario, says for his clients it entirely depends on what side of the transaction they’re on.
“I’ve heard from mortgage brokers that some companies are refusing to pre-approve buyers who work in the auto industry,” says Merrifield, reflecting how the changing tariffs have made the industry exceptionally volatile. Merrifield has heard of potential buyers who may get pre-qualified as they begin their search, but should they lose their job prior to closing on a property, that can send the transaction up in smoke.
For sellers, Merrifield has seen them wanting to work quickly, to avoid a drop in overall prices should the market fall further. Merrifield notes the sellers’ market is hot right now, but usually for more affordable properties, and the luxury home market in the city has remained relatively unchanged. Buyers, however, are understandably nervous until there’s a more stable understanding of what’s coming next.
In a city like Windsor, the automotive industry may be dominant, but the offshoot businesses will be equally impacted. Local parts manufacturers, tool and die manufacturers, and other industries that depend on automotive growth are also feeling the pinch. Plants are still running, but are hesitant across the board to commit to further growth without a clearer forecast in hand. Montreal will also be impacted by tariffs on sectors like steel, automotive, and aluminum. According to the Conference Board of Canada (CBoC), they’re expecting to see the city’s economic growth fall by 0.4 percentage points in 2025. The CBoC also anticipates that oil-focused regions of the Prairies, including Winnipeg, Saskatoon, Regina, Calgary, and Edmonton, will be affected and see a GDP drop between 0.3 and 0.4 percentage points annually. Realistically, all provinces will feel the impact of tariffs, but some will be hit harder than others, which can affect local housing markets.
Will tariffs continue to influence Canadian housing markets?
It’s nearly impossible to tell what’s coming next with this trade war. President Trump has frequently spoken out about the USMCA—the US Mexico and Canada Agreement—he signed during his first term in office. Since taking office for this term, he has made roughly 50 changes to his tariff policies, and more may be on the horizon.
Would you like to know if you should even consider buying, selling or both in this market? There are a myriad of factors to consider, not the least of which is the trade war with the USA.
My team and I stay up-to-date on the latest economic conditions. We follow trends and patterns closely.
Give us a call (905-683-7800) – we’ll answer any and all of your questions so you’ll be able to make the right move at the right time.
Thanks for reading today’s BLOG!!!
Brian Kondo
Sales Representative / Team Leader
The Brian Kondo Real Estate Team
Re/Max Hallmark First Group Realty Ltd.
905-683-7800 office
905-426-7484 direct
brian@briankondo.com
www.BrianKondo.com
www.BrianKondoTeam.com
Shaun Bernstein's article was initially published on Realtor.ca. You can find it by clicking here.
| REALTOR.ca is the most popular and most trusted real estate website in Canada. Owned and operated by the Canadian Real Estate Association (CREA), REALTOR.ca provides up-to-date and reliable information that makes finding your dream property easy and enjoyable. REALTOR.ca is popular with sellers, buyers, and renters and is accessible online and on mobile devices. |
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Shaun Bernstein |
About the Author Shaun Bernstein is the owner and Chief Storyteller of The Write Stuff Agency, based in Oshawa, Ontario. A journalist and lawyer by training, he focuses on helping business and professionals tell their stories better in a way that keeps their clients reading. Shaun's own story includes playing copious amounts of trivia, and a lot of half-finished home improvement projects. |
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