Have you driven across the Peace Bridge lately?
If you have, be honest: did you actually find it peaceful?
It’s an odd name for a bridge that connects Canada and the United States of America, given the current political climate out there, but what’s done is done; we can’t rename the bridge.
It was named in 1925. You can’t just go renaming landmarks, whether that’s a bridge or, I dunno, say, something like…….a body of water...
I know that the TRB readers really like when I talk politics here on the blog, but having said that, we’re not going to get into the mud with “Trump’n’Carney” today.
But I do want to address the elephant in the room as far as the trade war goes and how it affects, or could affect, the real estate market.
Last week, I was in a downtown Toronto condo with the owners, who are preparing to sell in the fall market.
One of them asked me, “What if it doesn’t sell?”
Now, this isn’t a micro-condo, it’s not in a building still under construction, and it’s not staring at the Gardiner Expressway. All this is to say that the unit is marketable, in demand, and should have no problem selling this fall, provided it’s presented properly.
The condo will be emptied, repaired, painted, cleaned, staged, and marketed effectively.
It will also be priced at fair market value.
Even though the resale condo market isn’t great, a condo like this, presented like this, will sell.
It’s just a matter of when, and for how much. If I were betting, I’d say we’ll have it sold in six weeks or less, and within $20,000 of the list price.
Nevertheless, after explaining this to my clients, one of them said, “Yeah, but, well, the trade war and all…”
Fair point.
Valid fear!
But as I explain to my daughter at night when she says she’s afraid of the Headless Horseman, having a fear of something doesn’t mean that it can actually hurt you.
Yes, there is a trade war happening.
No, the 26-year-old who is looking for his or her first condo is not going to be affected by it, directly or indirectly.
I told my clients, “An auto-worker facing a layoff is not buying this condo. And even if there is a small business owner who ships 70% of his or her wares south of the border, who will no longer be able to buy your condo, that’s a minuscule fraction of the buyer pool.”
Go ahead, tell me I’m sugarcoating this. Tell me I’m shilling for the real estate industry, and that behind the scenes, I’m afraid.
But what we’re experiencing is not directly affecting scores of individuals, but rather the fallout from a trade war could have more of an overall blanket effect on the entire population. The cost of goods and services could increase as a result of a trade war, but this doesn’t eliminate the down payment that an individual has saved for a home.
In fact, despite the “economic uncertainty” that we’re facing, and have been facing since January of 2024, those with money invested in the equities markets aren’t afraid of anything!
If you were dropped into our economy from another planet, and looked around at the brewing trade war, would you believe these were year-to-date returns?
15.27% – TSX Composite
12.44% – Nasdaq Composite
12.12% – S & P 500 Index
11.34% – Dow Jones Industrial Average
I highly doubt it.
Now, there is one way in which I believe a trade war could directly affect the housing market, but before I get to that, I want to look at some of the recent headlines about the intersection of the trade war and real estate.
Here’s one from last week::
“Realtors Hoping For A Rebound Get Sideswiped By A Trade War”
The Globe & Mail
August 25th, 2026
From the headline, this would seem to be more about the “hopes and dreams” of Realtors, both good and evil, as it pertains to their “gross” commissions.
Being “sideswiped” would suggest that, collectively, we were completely caught off guard! We never saw it coming!
Here’s the part of the article that interests me:
An escalating trade war may roil Canadian real estate once again after the market in many cities appeared to be settling into a stable pattern at last.
National housing sales improved for the fourth consecutive month in July, which lent more reassurance to the view on Bay Street that the worst of the downturn appears to be in the past.
In Toronto, one high-end trade created a buzz in mid-August when a property with an asking price of $22-million drew three offers and sold above asking.
Then trade negotiations between Canada and the United States broke down on Aug. 21, the U.S. imposed new tariffs and Prime Minister Mark Carney promised to retaliate with countertariffs.
Trade uncertainty sent home sales into a tailspin across the country when U.S. President Donald Trump began ramping up tariff threats in February, 2025.
Buyers and sellers have been rattled with each twist and turn since. Many worry about the impact on jobs, business investment and interest rates.
With respect, this makes no sense to me.
What does one luxury home have to do with the housing market?
Talking about $22 Million houses is for fanboys and fangirls alike. It’s swooning over a Hollywood celeb. It’s watching HGTV.
I don’t know anything about $22 Million houses, and I don’t care. In my humble opinion this offers absolutely zero insight into the market.
The article continues:
Property trades in the upper echelons have been particularly slow in the past two years as Bay Street mavens, investors and business owners worry about the potential harm to this country’s economy and their own financial prospects.
That’s why agents were heartened when a contemporary Forest Hill residence with four levels and five bedrooms changed hands for $23.5-million. Three bidders vied for the property with a sculptural winding staircase, a choice of pools and a Zen garden.
Again, I would respectfully disagree.
“Bay Street mavens” don’t go from Rosedale and Forest Hill to the homeless shelter very often, and I don’t believe that any real estate agents in Toronto are looking at $22 Million houses with Zen gardens as some sort of housing index.
If this is what people are reading out there, they must be rather confused about the real estate market.
Here’s another one:
“Trade War Dents Home Sale Hopes”
The Globe & Mail
August 28th, 2026
From the article:
That glimmer of hope for the real-estate market I mentioned last week? It was over almost as soon as it started. Canada’s trade war with the U.S. is raging once again and threatening to roil home sales and prices just as things were starting to look up.
Real estate agents had reason to believe the worst of the downturn may be over just last week with new data showing improving national home sales for the fourth consecutive month. But as Carolyn Ireland reports, more than a year after Trump’s tariff threats first sent home sales into a tailspin, fresh U.S. levies on many Canadian goods have the housing market bracing for more turbulence.
Buyers and sellers worried about the effects on their jobs, investments and interest rates are on a rollercoaster ride they can’t get off. And many sellers trying to bail are worried they’ll have to sell at a steep loss if buyer confidence doesn’t bounce back. “I honestly don’t know how the fall market will be,” James Warren, a real estate agent with Toronto’s Chestnut Park Real Estate, told Carolyn. “But if you want to sell, you’ve got to price your house for this market.”
Okay, so this article really just references the previous article, but it still counts.
It’s still an article. It’s still a headline. It still shows up in news feeds.
But what I completely disagree with is this:
Buyers and sellers worried about the effects on their jobs, investments, and interest rates are on a rollercoaster ride they can’t get off. And many sellers trying to bail are worried they’ll have to sell at a steep loss if buyer confidence doesn’t bounce back.
Pardon my French, and I really don’t swear on TRB all that often, but this is complete bullshit.
Again, my apologies. But I don’t know that there’s a better word.
“Investments are on a rollercoaster ride,” the article says.
Are they?
I just showed you that the freakin TSX is up 15% this year!
WHAT ROLLERCOASTER RIDE?
“Interest rates are on a rollercoaster ride,” the article also says.
Are they?
Let’s have a look at the Bank of Canada interest rate since October of last year:
Yeah, what a rollercoaster ride!
Should I illustrate this graphically, or is it already ridiculous enough that I spent two minutes creating that chart?
Now, maybe you want to cut the author some slack. Maybe you want to say, “David, interest rates could be on the rise!”
Yeah, except one quick trip to the headlines shows us:
“Bank Of Canada To Hold Rates For Another Year, Wait For More Stability On Trade”
Reuters
August 28th, 2026
From the article:
The Bank of Canada will keep its overnight rate at 2.25% on Wednesday and leave it unchanged for at least another year, according to a Reuters poll of economists who have not changed their outlook following the suspension in trade talks with the United States.
A year!
Not “until the end of the year,” but rather a year.
Actually, the article says “at least another year.”
Look, I don’t know which photographer or food critic was tasked with opining on the state of the Canadian real estate market in the face of a trade war over there at The Globe & Mail last week, but my goodness, was that paragraph poorly written! And the worst part is, the author dragged the name of another reporter at The Globe & Mail into her own column.
“Sellers trying to bail,” the author wrote.
“Worried they’ll have to sell at a steep loss,” it reads.
What loss? Who? When did they buy? What are they selling?
This reeks. It’s so poorly written, I would expect to find it on some hack guy’s blog, not in a major Canadian newspaper…
Now, I mentioned the idea that there’s a way in which individuals could be directly affected by the trade war and that this could directly affect their ability to transact in the real estate market.
Job losses aside, the only way in which this would happen is if interest rates shot up, mortgage payments spiked, and buyers could no longer afford to enter the market, just as some sellers can no longer afford their mortgage payments.
But we covered this, didn’t we?
Spoiler alert: I already made the case for this above!
But here’s more evidence, just in case you want a different voice and a different source:
“Case For BOC Rate Hike Crumbling As Trade War Heats Up”
Canadian Mortgage Professional (CMP Magazine)
August 25th, 2026
From the article:
Before trade talks collapsed, financial markets saw a strong chance that the central bank’s next move would be to bring rates higher amid continuing concerns about an inflation flare-up due to soaring oil prices.
But while he doesn’t expect the Canadian economy to take a huge hit from the latest round of US tariffs – which impact a swathe of Canadian products including alcohol, dairy goods, and wood and paper – Servus Credit Union chief economist Charles St-Arnaud (pictured top) said odds of a hike are rapidly falling.
“What [the trade war] really creates is that the probability of a hike… is very low, until probably spring next year,” he told Canadian Mortgage Professional. “And if there’s something like a new development, a new negotiation, and we get to an agreement that is actually beneficial for Canadians, I don’t see the Bank of Canada moving toward hiking interest rates.”
Folks, I welcome your commentary, criticism, and disagreement.
If you wish, please explain to me how this trade war will directly affect the housing market here in Toronto, but better yet, please explain why the “Bay Street mavens” are going to stop feeding their trust fund kids caviar for breakfast.
Bottom line: there is a lot of noise out there at the moment, and a lot of it makes absolutely zero sense.
A rollercoaster ride.
Seriously.
At the CNE, maybe…
