Home sales decline as trade fears mount

• Home sales declined 3.3% in January compared to the previous month as fears grew about U.S. tariffs and a potential trade war.

Home sales across Canada dropped 3.3% month-on-month in January, coincided with growing uncertainty over looming tariffs and fears of a deteriorating trade relationship with the United States.

Trepidation over tariffs: Despite the monthly downturn between December and January, sales were up 2.9% year-over-year. The latter part of January saw a significant drop in buyer activity, which analysts attribute to growing concerns over potential trade conflicts with the U.S.

Listings spike: Meanwhile, new property listings surged by 11% month-over-month, one of the most substantial increases on record outside of pandemic-related anomalies. This influx of listings, especially pronounced in British Columbia and Ontario, led to a softening of market conditions.

Trade war anxiety: "While we continue to anticipate a more active spring for the housing sector, the threat of a trade war with our largest trading partner is a major dark cloud on the horizon," said James Mabey, Chair of the Canadian Real Estate Association. "While uncertainty about the economy and jobs will no doubt keep some prospective buyers on the sidelines, a softer pricing environment alongside lower interest rates will be an opportunity for others."