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The ongoing trade conflict between Canada and the United States is exerting significant pressure on the Canadian housing market. Economist Tony Stillo from Oxford Economics warns that the tariffs imposed by the U.S. are broad enough to trigger a nationwide recession, affecting all sectors, including real estate. He observes that economic uncertainty has already led to a downturn in the housing market, with buyers becoming hesitant due to concerns about job security and income stability. This apprehension has resulted in decreased demand and increased listings, indicating potential distressed sales. Consequently, Stillo anticipates a further five percent decline in housing prices across the country, although regional variations will occur.

The Greater Toronto Area (GTA) exemplifies this trend, experiencing a 2.4% seasonally adjusted drop in home sales in March 2025, following a steeper 28.5% fall in February. The Toronto Regional Real Estate Board (TRREB) reports that home prices have declined for the third consecutive month, with the home price index decreasing by 1.4% to C$1,050,200. Year-over-year, sales were down 23.1%, and the price index dropped 3.8%. TRREB’s chief market analyst, Jason Mercer, attributes this slowdown to trade uncertainty and the upcoming federal election.

​ In response to the economic strain from the trade conflict, the Bank of Canada has been proactive, implementing its seventh consecutive interest rate cut, reducing the benchmark rate to 2.75%. This move aims to stimulate economic activity amid the challenges posed by U.S. tariffs, which include a 25% duty on Canadian non-energy imports and a 10% duty on energy products bound for the U.S. These tariffs have led to delayed investments, hiring freezes, and business relocations, further impacting the housing market. Despite these measures, the central bank warns of potential severe economic consequences if the trade conflict persists.

Read the full article on: BNN Bloomberg