Trade War Ices Housing Market, and the Rate Cut Question (Again)

This week’s top real estate stories.

By Jared Lindzon | 2 minute read

Every Friday, Wahi brings you the most important real estate stories from the past week. 

Rate Cut Back on the Table?

Like a good mystery novel, every page of Canada’s economic story is making us cast doubt on our previous predictions, and at this point we’re about ready to give up guessing. Two weeks ago a rate cut seemed more than likely, then last week’s inflation data sent odds sharply in the opposite direction, before this week’s GDP report reignited the prospects of another summer rate cut. According to Statistics Canada, the economy fared worse than expected in April, declining 0.1%, meaning a rate cut is now back on the table — at least until the next clue is revealed.

Toronto Cracks Open the Door to Sixplexes

Toronto took one small step along the long road to making sixplexes in the 6ix a thing. The higher-density type of home is considered a solution to the city’s “missing middle” problem, and allowing their construction city-wide comes with $471 million in federal incentives. But efforts to allow their development in areas currently limited to detached, semi-detached, and townhomes have been met with opposition by those who don’t want them changing their neighbourhood’s vibe. Last week, Toronto City Council compromised on legislation that permits sixplexes in Old Toronto, East York, and one ward in Scarborough, and agreed to study the effects before any city-wide expansion is adopted.

Trade War Putting Summer Market on Ice

After working on itself over the winter and spring, Toronto’s housing market is beach-ready in time for summer but lacking the confidence to shed some layers. Despite rocking a body that Royal LePage CEO Phil Soper describes as “structurally sound,” buyers are staying cooped up inside, fearing economic instability. That assessment is backed by a report from Oxford Economics, which suggests the trade war is “deepening the housing market downtown” country-wide. Meanwhile, independent Wahi analysis of the RPS-Wahi House Price Index recently found that some of the cities with the highest exposure to negative economic effects from tariffs were already seeing home prices drop. But with strong fundamentals to flaunt, the Canadian market is only lacking in self-confidence, which experts say would come along with a trade deal with the United States.

Calgary Slows Its Horses

Calgary’s housing market was expected to take off like a stampede but has instead been lassoed in place. Last week, the Calgary Real Estate Board downgraded its sales forecast for the year from 26,000 to 23,000 transactions. That’s still 11.5% more than the long-term average, but well below the 20% forecast in January, thanks to a spring slowdown resulting from economic uncertainty. Prices for detached and semi-detached homes are also expected to increase by less than 2% this year, after leaping 10% in 2024, while prices for row houses and apartments are projected to drop 2%, after surging by 14% last year.

Affordable ‘One-Bedroom’ Rentals in Vancouver Don’t Come with ‘Apartment’

There are plenty of single bedrooms available for around $1,000 in Vancouver, but we’re not talking about one-bedroom apartments. According to a new report by Statistics Canada individual rooms are renting for over a thousand bucks in Canada’s most expensive housing market, and about the same in nearby Victoria and Kelowna. By comparison, a bedroom in a multi-unit property goes for about $500 in many parts of Quebec, including Sherbrook and Drummondville. That’s also where asking rents for two-bedroom apartments remain the lowest among Canadian cities, but where rents have jumped the most in recent years, having doubled since 2019.

Share this article on social.