The Bank of Canada recently announced its sixth consecutive rate cut—a move that should be great news for buyers and sellers alike. Lower interest rates typically translate to increased affordability and a more balanced housing market. However, that positive momentum was quickly overshadowed by news that the United States is considering a 25% tariff on goods imported from Canada.
So, what does this mean for our housing market? Let’s break it down.
Tariffs & the Housing Market: The Connection
Any time there is negative economic news, uncertainty follows. And in real estate, uncertainty often causes hesitation. Buyers and sellers who were considering a move may adopt a ‘wait and see’ approach, delaying major financial decisions until they have more confidence in the market.
Right now, people are feeling optimistic about rate cuts and increased inventory, which are making the market more balanced. However, if concerns about tariffs start affecting job security, we could see a slowdown in market activity.
Short-Term vs. Long-Term Impact
I think many Canadians, including Albertans, are worried. The full impact of these political actions are unknown at this time. While the full impact remains uncertain, here’s how things could play out:
- Assuming the tariffs are short-lived – The balanced market will likely continue, and growth is projected to be around the 3-5% mark for housing prices this year.
- If tariffs are imposed and if the trade wars go on for longer than 6 months – We may see a rise in unemployment rates and inflation, leading to more homes on the market but fewer buyers. This shift could push us toward a buyer’s market, ease pressure on the rental market, and result in higher vacancy rates.
The Silver Lining: A Buyer’s Advantage
Even if the market shifts in response to prolonged tariffs, there are still opportunities for buyers—especially with interest rates trending downward. Lower rates improve affordability, and in a buyer’s market, there is more selection and negotiating power.
For sellers, a changing market can feel stressful, but everything in real estate is relative. If you're buying and selling at the same time, you'll experience tighter conditions as a seller but greater flexibility as a buyer. If you’re only selling, preparation is key—working with an experienced listing agent can help you position your home strategically for success.
Even in shifting market conditions, many sellers are still seeing gains over pre-2020 values. While it may take a little more effort to sell now than it did in the past few years, Alberta’s real estate market remains strong.
A Message to First-Time Buyers
If you're a first-time homebuyer, keep your goals in mind and focus on the bigger picture. “Time in the market” is more important than timing the market—long-term homeownership remains one of the best ways to build wealth over time.
Final Thoughts: Stay Positive & Support Local
Despite the uncertainty, Canadians are resilient. This is an opportunity to support local businesses, make smart real estate decisions, and focus on what truly matters—finding the right home for your needs. Whether you're downsizing, upsizing, or rightsizing, it’s still a good time to make a move.
Stay informed, stay optimistic, and remember—we’ve got this, Canada! 🇨🇦
