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Canadian Housing Market Hits 16-Year Low as Tariff Uncertainty Weighs on Sales

March home sales and construction activity plummet, prompting a downgraded forecast from CREA, while recent tariff rollbacks hint at potential recovery later this year.

Overview

  • Canadian home sales in March dropped 4.8% from February and 9.3% year-over-year, marking the weakest March since 2009, according to CREA data.
  • Housing starts also fell by 3.3% in March, reflecting a slowdown in construction activity and a broader market stagnation.
  • CREA revised its 2025 forecast sharply downward, now projecting a near-flat 0.2% decline in home sales compared to earlier expectations of an 8.6% increase.
  • U.S. tariffs on Canadian goods, particularly those imposed by President Donald Trump, have been identified as a key driver of declining buyer confidence and economic uncertainty.
  • Recent rollbacks of some U.S. tariffs, including potential changes for Canadian automobiles, could help stabilize the market ahead of the summer, though the outlook remains uncertain.