How Has Canada's Housing Market Fared So Far in 2025?

There’s often a sense that Canada’s housing market is teetering on the edge of collapse — that one well-placed nudge could knock the whole thing over.

Who better than Donald Trump, nudger-in-chief, to test its limits?

Canadians have largely delayed their home purchases since Trump announced blanket tariffs on Canadian goods in February. (A mortgage isn’t particularly appealing when it looks like the economy’s about to be asphyxiated.)

Sales have been picking up since April, but there’s no question that our housing market has been collateral damage in Trump’s trade war.

Just how wounded is it? It’s limping, but should make it home.

More disappointing than dreadful

Canadian home sales totalled 226,879 in the first six months of 2025. That’s a modest 4.1% dip compared to the first half of 2024, but slightly higher than in the same period of 2023.

2023 might be the more reliable benchmark when gauging how the market’s performed this year.

Two years ago, home buyers were coping with the after-effects of the COVID pandemic — the rising cost of living and higher interest rates. Today, they’re navigating both higher prices and the risks posed by Trump’s trade war.

In that light, sales this year haven’t been catastrophic.

Royal LePage president and CEO Phil Soper says he gives the market “a passing grade” for the first half of 2025, but he feels home sales are nowhere near where they should be.

“I would describe [the market] as unexpectedly soft,” Soper says. “Employment, savings, incomes, interest rates, availability of inventory — everything points to what should be the strongest market since the pandemic and it just didn’t materialise.”

That says a lot about the impact Trump’s tariffs have had on home buyers. There’s no hard data around how many people put off a home purchase due to the trade war, but Christopher Jokel, senior data engineer for the Canadian Real Estate Association, assumes it was a lot.

“It looks like [tariffs] took a pretty big bite out of activity in what’s typically the busiest time of the year, the spring market,” Jokel says.

Recovery: TBD

Home sales fell every month from December 2024 until March of this year, so it’s fair to say 2025 got off to an objectively horrible start.

Since April, those declines have reversed. Sales in June were the highest the country’s seen since January. Has the market turned a corner?

“It’s still too early in our opinion to say that this is the beginning of a recovery. But at the very least, it looks like [sales] have hit bottom and are starting a turnaround,” says Jokel.

Soper points to the past two months in one of Canada’s priciest and slowest markets as reason for optimism.

“May and June were good months for Toronto real estate,” he says. “We saw activity levels up, approaching double-digits.” (Sales jumped by more than 11% from April to May, but were flat in June, according to the Toronto Regional Real Estate board.)

The direction sales are moving is more significant than the gains being seen, especially if it signals a lasting shift in buyer mentality.

Exhausted by six months of tariff chaos, home buyers may have decided that tuning out the noise and moving forward is their best course of action. They might also be realizing that today’s higher inventory levels have tilted the market in their favour.

These shifts in attitude are precisely what the market needs to recover.

Affordability the “secret sauce” for winning markets

Here’s something that might be hard to believe: seven provinces have seen home sales increase in the first half of this year. Those that haven’t are the most expensive markets in the country.

	Total Sales January-June 2023	Total Sales January-June 2024	Total Sales January-June 2025
B.C.	37,505	36,776	34,283
AB	35,573	41,552	38,621
SK	7,107	7,944	7,964
MB	6,846	7,625	8,133
ON	87,930	86,345	74,562
QC	37,264	42,507	48,484
NB	4,508	4,592	4,727
NS	5,032	5,280	5,468
PEI	933	953	1,102
NL	2,623	2,716	3,079

Source: Canadian Real Estate Association

If buyers in every province are prone to the same anxiety and uncertainty around the economy, could these regional differences be a sign that affordability is more of a factor for home buyers than tariffs?

“It’s true that more expensive markets have performed worse since the start of the year, though I take that to signal that the effects of uncertainty are compounded in more unaffordable areas,” says Brendon Ogmundson, chief economist at the British Columbia Real Estate Association.

But if uncertainty’s the driving factor, one wonders why home sales have soared in manufacturing-dependent Quebec, where the job market could be decimated by tariffs.

And in Saskatchewan, where tariffs threaten the province’s crucial agriculture and mining sectors, home sales have been above-average for 24 consecutive months.

Chris Guérette, CEO of the Saskatchewan Realtors’ Association, says lower prices are the province’s “secret sauce.”

“I really do think that when you have a market that is affordable and attainable, they are able to weather economic storms better,” Guérette says.

There’s no denying tariffs’ effect on the market this year, but once they go away, home buyers will still face severe affordability challenges.

Back in March, NerdWallet’s 2025 Canadian Home Buying Report found that the cost of living was the most common obstacle to buying a new home for both first-time and repeat buyers. Tariffs, not so much.

“Uncharted water” ahead

CREA’s most recent housing forecast expects the number of homes sold in 2025 to be 3% lower than 2024, which would keep them on their current pace.

In contrast, Royal LePage’s 2025 Market Survey Forecast sees sales rising by 3.5% this year, a suggestion that a busier six months are around the corner.

Both forecasts were compiled before Trump threatened 35% tariffs on Canadian goods starting August 1. The housing market’s immediate future might hinge on what kind of trade deal can be reached between the U.S. and Canada.

“This is kind of uncharted water in terms of where we sit,” says Re/Max Canada president Don Kottick.

Kottick remains hopeful that the government can negotiate an end to the trade war.

“I believe that once we are out of this, we could see a market rebound quite quickly,” he says.

After surviving six months of an off-the-leash Donald Trump, Ogmundson believes the market can survive the next six, too.

“I was more pessimistic a few months ago, but I think now there is a likely path to ending the tariff drama without too much economic damage,” he says.

“In that case, I could see sales picking up over the summer and into the fall, setting up a much stronger 2026.”