Will Trump's tariffs impact the Canadian housing market and why is the answer yes?

At Zown, we’re always keeping tabs on the big moves that could shake up the Canadian real estate market, and right now, Trump’s tariffs are front and center. As of March 3, 2025, with his second term in full swing since January 20, these tariffs are starting to take shape, and we’re digging into what they could mean for the housing scene here in Canada. Let’s break it down in a way that’s easy to follow, looking at how this could hit businesses like ours, homeowners, and the market we all care about.

So, what’s the deal with these tariffs? Basically, they’re taxes the U.S. puts on stuff we send their way like a 25% hike on most Canadian goods and a 10% bump on energy exports like oil and gas. Trump’s pushing this to get Canada and Mexico to tighten up on things like illegal immigration and fentanyl crossing into the U.S. Fair enough, but it’s got us at Zown thinking about the ripple effects, especially since 75% of Canada’s exports, about $50 billion a month, head south. That’s everything from lumber to car parts, and when the U.S. makes those pricier, it’s like hiking the cost of our whole operation overnight.

Canada’s planning its own 25% tariffs on $155 billion of U.S. goods. Think appliances or fixtures we might use in homes. That could jack up our costs, and guess what? Those hikes often land on buyers or tenants. If we lose sales and have to cut jobs, unemployment might climb to 7% by next year, making it tougher for people to afford homes. Inflation could creep up too and supply chains get messy with tariffs. Suddenly everything from drywall to groceries costs more. It’s not just us feeling it; it’s the whole market.

There’s a flip side, though. We’re noticing a “Buy Canadian” push that could work in our favor if we’re local-focused. But finding new buyers to replace the U.S. market? That’s not a quick fix. This could even spark a trade war, with Canada talking big retaliatory moves like taxing U.S. energy or blocking American firms from deals. It’s a two-way street because the U.S. relies on our lumber and oil too. Trump’s done this before, like in 2018 with steel, only to ease off after talks. Maybe it’s a bargaining chip again. Only time will tell.

Looking ahead, we’re wondering how long this lasts. Trump paused these tariffs for a month but they’re set to start again tomorrow, March 4, 2025. If we play ball on border security, maybe they soften. If not, recession talk for mid-2025 gets louder, with places like British Columbia eyeing a $69 billion economic dent by 2028. The Bank of Canada might cut rates to help us out, which could lower mortgage costs for buyers. Typically that is great news for a company like Zown who helps folks buy and sell homes but if inflation spikes, they might hold off, leaving the real estate market as a whole in a tricky spot.

For Zown, and all Canadians, this means bracing for a wild ride. Construction costs could climb 10-15% with U.S. materials like steel or glass getting pricier, pushing up home prices or stalling projects. Demand might dip if folks get jittery about jobs, especially in export-heavy spots like Calgary. But in hot markets like Toronto, supply shortages should keep prices steady, or even push them up if foreign buyers (post-ban, maybe 2027) swoop in.

Bottom line? Trump’s tariffs could mean higher costs, slower builds, and a shaky economy for us and our clients. But we’re not just sitting tight because the U.S. needs us too, and this might just be Trump flexing for a deal. Zown is staying sharp, exploring local options, and ready to pivot.