The Effect of Trump’s Tariffs on the Toronto Real Estate Market
The on-again, off-again American tariffs may be poised to adversely affect the Toronto resale market
With all the flip-flopping back and forth on the proposed American tariffs being imposed on Canada, some have asked how this might affect our local real estate market. The?Ontario Home Builders’ Association has already warned?that the tariffs could hurt the new home sector, which is already floundering amid?record-low sales volumes, especially for presale condos. But what would it mean for the resale market?
Of course, if the overall economy suffers, then that adversely affects demand for real estate in general. RBC economists recently stated: “The trade war launched in March by the U.S. against Canada (Mexico and China) threatens to further erode market confidence, upend buyers’?plans and quiet a usually busy spring season. The impact would intensify the longer trade uncertainty rages,” RBC also notes that home resales in the city have already plummeted 29% between January and February of this year, marking the largest fall since the beginning of the pandemic, a similarly economically disastrous time.
Some would obviously be more affected than others, especially people who work in the import/export industries. The general public however will see the price of a lot of goods rise thereby limiting the amount they have to spend on real estate. The longer that a trade war goes on, the more likely that prices will drop, and the downward pressure will continue.
