Who can blame any buyer and seller for beating a retreat from the property market with a global trade war looming involving our nearest neighbour.
The shock and uncertainty of tariffs between the world’s biggest economies and ensnaring Canada has caused every Canadian to recoil and reassess.
The latest figures from the Canadian Real Estate Association (CREA) show national home sales fell 4.8% month-over-month in March, and the average sale price is down 3.7% year-on-year.
This result occurred when the US was aiming huge tariffs at many of our key exports – a threat that’s been withdrawn but may yet eventuate. No one can know for sure.
As a result, the number of newly-listed properties moved 3% higher on a month-over-month basis.
Meanwhile, the MLS Home Price Index (HPI) declined 1% month-over-month and is down 2.1% compared with last March.
The Bank of Canada was also in a state of shock holding off an anticipated interest rate because it wanted to see what might happen next.
Our interest rate has been cut seven times since June and now sits at an attractive 2.75%. It has helped the property market find a stable footing.
Buyers and sellers alike should carefully assess their own situations rather than simply withdraw.
This could be a great time to upsize. While you might not get your anticipated price for your apartment or house, upsizers will likely benefit more from a market discount when they upgrade.
You’d gain financially by upgrading in Toronto and Vancouver right now, as prices are in a momentary dip. And there is good buying in Ontario and British Columbia, too.
Values are down in southern Ontario because it’s the centre of our auto industry and also manufactures electronic goods and chemicals.
Trends are flat in Calgary but holding up in Quebec.
In its regular property report, the Royal Bank of Canada said confusion around tariffs would need to end before the property market could revert to its normal patterns.
The resale of homes in Toronto – normally a bellwether market – recorded the lowest March level since 1998. Sales are off by nearly one-third since the tariff saga began.
The city’s prices are down only marginally, however, and they remained above the $1 million average.
RBC added that median prices for single-family homes (+8%) and condo apartments (+5%) remain strong, although the number of transactions for these types of properties has slowed.
Here are four issues to consider before entering the property market.
Analysis, not headlines – The tariff impact on real estate can be localised. Talk to local agents and delve into the specifics of your local area, and where you’d like to buy. Are sales volumes decreasing? Are prices softening?
Assess your situation – Don’t let fear of potential tariffs drive your decision. Selling a home is a significant life event with substantial financial implications beyond the current market value. Consider your personal situation: Are you relocating for a job? Do you need more space for a growing family? Are you downsizing for retirement? If your life plans necessitate a move within a specific timeframe, trying to time the market based on economic anxieties might be a fruitless and stressful endeavour.
What’s your “wow factor” – In a softening market, the unique features and condition of your property become even more critical. Does your home offer something that stands out from the competition? If your home requires substantial work, selling now might be challenging. Be honest about your home’s condition and how it might be perceived by buyers.
Opportunity cost – Consider the potential downside of not selling. Sometimes, securing a sale now, even at a slightly lower price than you might have hoped for in a strong market, can be a more financially sound decision than waiting for an uncertain future.