So much for that

Well, it’s pretty clear now that Big Daddy won’t be pulling a free trade bunny out of his hat in the next two weeks. Don’t expect any deal with Trump that doesn’t come with tariffs, he said on Monday. Then on Wednesday he announced we’re going to shut out Chinese steel imports being dumped here in an effort to save the industry.

Why hit China? Because Trump won’t remove his devastating 50% tax on Canadian metals. So we have to slam the door to the cheaper stuff and pay more to support jobs in places like Hamilton.

Face it. The American president will cause inflation in Canada to increase, the jobless rate to tick a little higher, interest rates to stay stuck and, yup, the housing market torpor to continue. Financial portfolios will do just fine because of 47. Real estate will be the opposite. If your daughter bought a 600-foot DT condo last year with a mortgage you co-signed, well, I hope you love her.

Where are we now?

The national realtors cartel has once again rolled back its forecast for sales. In January CREA said deals would increase this yea(over last) by 8.6%. In April it recanted and forecast no growth. Now we’re told sales will actually be lower by3%. And it’s only July, so more downgrades could materialize.

Average prices, they add, will be down about 2% – which still seems a tad optimistic. And, realtors being realtors, we’re being told to believe this: “The good news is markets appear to be entering their long-expected recovery phase, fuelled by pent-up demand, lower interest rates, and an economy that is expected to avoid worst-case tariff scenarios.”

But wait. The PM says tariffs are a fact of life. Already the steel and car guys are losing their jobs. Inflation just went up. The central bank has stopped reducing the cot of loans. And we still have a million families about to renew their mortgages at elevated levels. How is this a “long-awaited recovery phase”?

Over at Royal LePage, always a leader in house-pumping, they’re talking about “global economic uncertainty” dampening buyer enthusiasm. The company acknowledges the spring real estate market never materialized.

According to company stats, Toronto houses lost 5% of their value this past year. “With trade disputes, a federal election, and international conflicts dominating headlines through the first half of the year, many prospective buyers chose to wait. Yet, market fundamentals remain sound; interest is strong while activity is subdued, reflecting the uncertainty weighing on consumer sentiment.”

See, it’s all the fault of consumers. Wimps.

As for condos, which are being truly whacked at the moment, the reasons are more financial. Investors have been liquidating units and refusing to add more to their portfolios because the math no longer works. A drastic drop in immigration and international student levels has helped drive rents down. Given increases in property tax and condo fees, it means seven in ten rental units are in negative cash flow – with their owners losing equity monthly. Tenants, 1. Hated landlords, 0.

Well, despite what the agents and brokers say, things are growing more dire. Twenty new developments have been cancelled, erasing over 4,00 units. Major builders like Mattamy are shedding employees. Housing starts have ground to a halt. There are 32,000 resale properties in the GTA alone. Another 21,500 new units are available or sitting unsold. Area sales of new homes are running 87% below the ten-year average.

“As these low sales translate into construction, we could see a decline of up to 23,000 housing starts by 2027 versus 2024 levels, putting as many as 41,000 residential construction sector jobs at risk and jeopardizing up to $10 billion in annual construction investment in the GTA,” says an industry association spokesguy.

GTA condo sales in Q2 were down 70% from 2024. Analysis firm Urbanation is calling it the worst situation in 30 years. “We’ve seen sales slow for four years now, and the decline just keeps getting deeper and deeper,” Shaun Hildebrand, president of Urbanation, reports. “I would say that the market has gone from bad to terrible. The market is basically functioning at 10 per cent of its normal volume.” 

Meanwhile in Ottawa they try to put the best face on a situation that cannot be altered, controlled, improved or ignored. Trump is out of control, does not care about Canada (or anywhere else) and has no guardrails – not his party, Congress, the Senate, the civil service nor the Supreme Court. Tariffs are not going away. And we will be going down – at least for a while.

If you have a property to sell, go cheap or fuhgeddaboudit. If you’re buying, be ruthless. If you’re a roofer or a realtor, we’re pulling for you. Well, the roofer, anyway.

About the picture: “Thanks for the fantastic blog. I appreciate the great advice and learn something from you every day,” writes Karen. “This cool cat showed up last night for a drink from the bird bath. After having a refreshing sip or 10, he decided to relax and check out the scenery. There were magpies on the lawn who were having a lot to say about this unknown visitor. The feline eventually sauntered off to do more exploring/bird hunting. Fun fact: the magpie was recently named Edmonton’s official bird. https://www.cbc.ca/news/canada/edmonton/alta-edmonton-magpie-1.7580506

To be in touch or send a picture of your beast, email to ‘garth@garth.ca’.

Source: https://www.greaterfool.ca/2025/07/17/so-much-for-that-3/