High hopes for a brisk spring housing market are being tempered by the trade fight between Canada and the United States.
The Canadian Real Estate Association is showing a sharp drop in February sales of existing homes on both a month-over-month and year-over-year basis. Resales fell 9.8% compared to January and 10.4% compared to February of 2024. About three-quarters of markets across the country experienced declines. Larger centres, like Ontario’s Golden Horseshoe, reported the most significant drops.
CREA says the numbers show buyers are retreating from the market because of the economic uncertainty caused by U.S. tariffs, and talk of American annexation of Canada.
“The moment tariffs were first announced on January 20, a gap opened between home sales recorded this year and last. This trend continued to widen throughout February, leading to a significant, but hardly surprising, drop in monthly activity,” said CREA’s Senior Economist, Shaun Cathcart.
New listings also took a nasty tumble in February, falling 12.7% from January, erasing the gains than came in a surprise surge for the month.
The slowdown in sales did not have a big impact on prices. CREA’s National Composite Home Price Index dipped 0.8% from January and was down 1.0% compared to a year earlier.
The national average sale price of a home dropped 3.3% to $668,000, year-over-year.