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(Evelyn Hockstein/POOL/ AFP via Getty Images)Ontario’s sluggish resale housing market could face some headwinds from renewed trade tensions between Canada and the U.S., but the impact is unlikely to completely derail its ongoing recovery – at least in the short term, industry watchers say.Subscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.Subscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountorUncertainty and low consumer confidence resulting from the trade war, which entered a new chapter after trade talks collapsed between the two countries last week, have been some of the driving factors behind slower-than-expected home sales in the province in 2026.Last month, for example, 16,276 homes were sold in Ontario, a 1.3 per cent decline from July 2025, while year-to-date sales also remain below 2025 levels, according to the latest figures from the Canadian Real Estate Association (CREA).SUBSCRIBER EXCLUSIVE: FP West: Energy Insider brings you behind the oilpatch’s closed doors with exclusive insights from insiders every Wednesday morning.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of FP West: Energy Insider will soon be in your inbox.We encountered an issue signing you up. Please try againHowever, on a month-to-month basis, July also marked the fourth straight month of gains in home resale activity at the national level, with upticks also seen in recent months in provincial markets such as Toronto, Hamilton, Kitchener-Waterloo, London and Ottawa.“This latest round of the trade war with the U.S. puts at risk the confidence gains we’ve seen in recent months,” said Robert Hogue, assistant chief economist at the Royal Bank of Canada.“It certainly raises the risk of being derailed once again. But still, our base case is that the recovery will remain on track. It’s going to be gradual. It’s going to be uneven, and it’s probably going to be bumpy but, overall, it’s still likely to be sustained going forward.”After talks collapsed last Friday, the U.S. imposed 50 per cent tariffs on nearly $28 billion in Canadian products on Aug. 22, with Ottawa announcing on Tuesday a dollar-for-dollar counter-tariff response, slated to come into effect starting Sept. 8.Hogue, however, said that while the latest tariffs will hit certain sectors and businesses hard, from a larger perspective, “this is unlikely, in our view, to push Canada’s economy into a recession.”He said that despite the uncertainty of recent months, the Canadian economy has shown signs of resiliency. Canada’s jobless rate, for example, went down to 6.4 per cent in July, its lowest level over the past year. Interest rates have also remained steady after peaking in 2024.And while sales have been far from spectacular, Hogue also said there’s a lot of pent-up demand in the market from people who would’ve otherwise already purchased a home.“So, we’re not quite at the point of saying the housing market is about to fall off again,” he said. “We think there’s a bit of momentum there.”Mike Moffatt, founding director of the Place Centre economic think-tank at the University of Ottawa, said the impact on the housing market will depend on how long the U.S. tariffs remain in place.“If these kinds of tariffs stick around for a while, and we start seeing job layoffs, particularly in the manufacturing sector, that can certainly slow things down,” he said. “But I think, overall, we’ve just had this uncertainty for so long that I think we’ve grown kind of numb to it.”Moffatt also said there are other barriers impacting the market, including people’s ability to afford a home, even if prices have been trending upward in recent months. Demand has also been impacted by changes in immigration targets, which have slowed population growth, particularly in Ontario.“The housing market, over the last five to 10 years, has had to adjust to so many big changes, whether it be population growth or COVID-related migration, big swings in interest rates, and I think we’re dealing with the effect of that right now, where a lot of the market is just locked up.”Kevin Barry, owner and broker at Thrive Realty Group in London, said it’s still too early to gauge whether the latest trade-war developments are having an impact on buyers, given August is traditionally a slow month for sales.“Whenever anything big like this shifts, changes, or moves, there’s a moment of pause in the market, which I think we are seeing right now,” he said.“But people are also focused on going back to school, getting back into routine, getting the kids ready for the fall, so we normally see a bit of a lull in the market right now, so it’s tough to measure it against the reality of what’s happening south of the border.”Barry, however, acknowledged worries about the economy have been an issue for many buyers over the past several months, keeping some on the sidelines of the market.“The big conversation is need versus want,” he said. “If you need to move, you’re still going to do it. If you want to move, you’re going to pause and maybe be a little bit more considerate, a little bit more deliberate with your decision-making process.”jjuha@postmedia.com Join the Conversation This website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.