War is hell (MLS edition)

On Monday, a few dozen hours after America declared war on Iran, homebuyers in the US watched as mortgage rates swelled.

Not here yet. But if you’re in the market for a loan, best to lock ‘er up.

This is because of oil, which has jumped (but not spiked) in price. Since the White House has no clue when this conflict will end or how much destruction will be left in the oilfields of the Middle East, Mr. Market is assuming crude will be higher-for-longer.

Oil’s at $74 US as this is being written (not by robot). The Strait of Hurmuz, where the tankers traverse, is basically shut and Trump says it might take warship escorts to get things moving. That doesn’t sound temporary.

Oil price escalation feeds inflation everywhere. Investors in bonds demand protection, so debt prices go down and yields rise. That’s why American mortgage rates hiked. This could also throw into jeopardy expected interest rate cuts by the Fed, and slow economic growth. Ditto for Canada, especially if we get thumped again on trade. The odds of the next Bank of Canada move being up (not down) just increased – and the moment grew closer.

So, kids, don’t worry about your liquid B&D portfolio. It’s about as well positioned as any can be for this war of choice (not necessity). But you might ish to shed another tear for Canadian real estate.

After all, inflation is about to push higher. Gas and home heating costs will likely increase over coming weeks and months. Interest rates will go up before they go down. The media will be full of war news, air strikes, dead schoolchildren, street protests, incessant Israeli and US bombing and unknown outcomes. It’s the stuff that saps buyer confidence, makes people worry about the future and kicks the poop out of spring housing markets.

Already, as you know, we’re off to a bad start.

In Calgary sales last month tanked 11%, prices fell another 4.4% and the number of properties for sale jumped 16% over the same time a year ago. Soggy buyer enthusiasm has kept detached home prices in a slow melt – now averaging just over $734,000.

And this is interesting. At the same time the premier, Danielle Smith, is blaming “wide-open” federal immigration for overwhelming Alberta and pushing it into deficit, the real estate board blames “slowing immigration levels” for the housing crumble, rising inventories and weak demand.

Only one of them is right. Guess.

In Vancouver sales plopped 10% in February – which is almost 30% under the long-term average.

“With each passing data point, the pace of sales running well-below long-term averages are no longer a surprise – it’s become the new norm,” says ten real estate cartel. “A surprising finding this February, however, is that home sellers appear less eager to list their homes relative to last year with new listings down about seven percent, mostly driven by fewer listings in the apartment segment.”

Yup. People are giving up. Just when sellers should be primping for the big March bust-out on the west coast. There are now 13,545 properties for sale in Van, and just 1,648 changed hands last month – with the sales-to-active listing ratio for detacheds crashing to just 9%. That means one thing – a buyer’s market.

And what of prices?

The average of $1.1 million is down another 7% year/year. Detached homes (sales off 10.5) have dipped in value a further 8.8%, to $1,835 million. Still ridiculous, but three hundred grand less than they were not too long ago.

Across the ditch in Victoria, similar. Overall sales plunked 12% last month while condos were creamed by almost 20%. Inventory is up 10%, while the price of detached homes has stabilized at around $1.3 million.

Sales crashed in this city compared to last year, but February was less desperate than the month before. . “Though our sales numbers are lower than they were in 2025, with an over 35 per cent increase month over month, and a very healthy amount of inventory currently available, it will be interesting to see how our spring market unfolds in the upcoming months,” says head wizard Fergus Kyne.

Tomorrow should bring stats from the mighty GTA. Expect more of the same. Bad sales. Lower prices. High inventory. And more realtor blathering about pent-up demand, excellent buyer choice and improved pricing.

That’s all true. Plus financing costs lower than a year ago, sellers willing to entertain low-ball offers, vendor take-back financing and conditional sales. Conditions for buyers have not been this good since you first heard of Adele (oh, how we pine for that time…).

Alas, we have war. Bombing, missiles and drones. A rogue president. Gas going up. Inflation, too. So is anxiety. The fuel of housing is confidence, and we’re drained.

About the picture: “We’re having fun celebrating the Hindu festival of colours, love and spring – known as Holi – in Rishikesh, northern India,” write Heather and Fred from South Surrey. “Even our canine friend was getting into the festive spirit. Thanks for all you do to educate and inform the masses, Garth. Don’t know what we’d do without your daily dose of wit, wisdom and humour.”

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

Source: https://www.greaterfool.ca/2026/03/04/war-is-hell-mls-edition/