The ongoing trade war and rising economic uncertainties are having a significant impact on the Greater Toronto Area (GTA) real estate market. According to the Toronto Regional Real Estate Board (TRREB), while the region has already experienced steep declines in sales over the past few years, U.S. President Donald Trump’s trade tariffs are exacerbating the situation.
Jason Mercer, TRREB’s Chief Market Analyst, explains that in addition to long-standing affordability concerns, homebuyers have become more cautious due to the volatility in the economy. “Uncertainty surrounding our trade relationship with the United States is likely contributing to a wait-and-see attitude among potential homebuyers,” Mercer said in the board’s latest market report.
Sales in the GTA have seen dramatic drops in recent years, with transactions plummeting to levels last seen in the early 2000s. After peaking at an all-time high of 121,712 sales in 2021, real estate activity has steadily fallen. Despite a slight uptick in 2024, sales were still down by 44% compared to 2021. The total number of sales in 2023 was just 67,610, compared to a previous high of 121,712.
The situation has been further compounded by the tariffs imposed by the Trump administration on Canadian goods earlier this year. With more tariffs expected in April, economic uncertainty is spreading across both countries, creating widespread concerns in the market. In February, the GTA saw a significant decline in sales, with only 4,037 transactions compared to 5,607 in the same month last year—representing a 28% drop.
The real estate market in the region was already struggling before the trade war, largely due to the Bank of Canada’s interest rate hikes. In March 2022, the Bank raised its benchmark rate from 0.25% to 5% by July 2023, which resulted in slower housing activity. Despite a reduction in the rate to 2.75% in 2024, the rate cut has had little effect on sales or prices, which continue to trend downward.
Average sale prices for homes and condos across the 31 cities and towns monitored by TRREB have declined between 7.7% and 35.1%. TRREB’s data also divides Toronto into three regions—East, West, and Centre—all of which are experiencing declines in both sales volume and property prices.
The slowdown in the market, coupled with the uncertainty over trade relations and the broader economic outlook, suggests that the GTA real estate market will continue to face challenges in the near future.
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