Tag Archives: RealEstateCanada

Tariff on Canadian flag background

The Effect of Trump’s Tariffs on Canadian Real Estate

Canada’s real estate sector has continually been affected by both domestic and international economic as well as political factors. An underlying factor, amongst many that influenced the Canadian real estate sector within the recent years, is that of former United States President Donald Trump instituting tariffs. 

Of particular effect, these were implemented on steel, aluminum, as well as lumber. Broad repercussions were brought forth on building material costs, affordable housing, as well as broader investment across Canada’s real estate industry.

The Impact of Tariffs on the Construction Cost

One of the most real-world implications of Trump’s tariffs was that they resulted in an increase in the construction cost of materials. The United States imposed a 25% tariff and 10% tariff on imports of steel and aluminum from Canada in 2018, which increased the expense of acquiring these essential commodities for builders. 

This resulted in the following:

  • The construction cost of new homes and business developments went through the ceiling.
  • Homebuilders were compelled to pass these extra costs on to consumers, and this led to higher home prices.
  • The projects were delayed and exceeded budget due to rising material prices.
  • The Lumber Dispute and Housing Affordability

The United States had long been imposing duties on Canadian softwood lumber on the grounds that Canada was subsidizing its market unfairly. The tariffs were increased by Trump’s administration, which had a tremendous effect on Canadian homebuilders and the housing industry as a whole. 

The principal effects were:

  • Higher costs of wooden framing and wood buildings in house construction.
  • Higher costs of houses, which render housing beyond the reach of homebuyers.
  • Slower construction of new homes due to higher costs, which reduce supply in a tight market.

Foreign Investment Trends and Market Sentiment

Trump‘s trade and economic policies and the uncertainty that followed also indirectly influenced foreign investment in Canadian real estate. Foreign investors viewed Canada as a secure alternative to the U.S. during the uncertainty, thus the increase in:

  • Overseas demand for commercial and residential property in cities like Toronto and Vancouver.
  • Overseas demand, again driving up the price of property.
  • Some investors hesitant to invest due to uncertainty in U.S.-Canada trade relations.
  • The Resilience of the Canadian Market

Despite these difficulties, the Canadian housing market was resilient. Federal and provincial governments instituted policies to address affordability concerns, including:

  • Incentives for first-time buyers.
  • Increased focus on local production of lumber to minimize reliance on U.S. imports.
  • Strategic investment in infrastructure to mitigate rising costs.

Trump‘s tariffs had a profound effect on Canadian real estate, increasing construction costs, affecting the affordability of housing, and shifting foreign investment patterns. While some of those effects have been relaxing under the new trade agreements and policy overhauls, the long-term message is clear: Canadian real estate is incredibly sensitive to international economic policy and will continue to need to make adjustments to forces beyond its control.

As international trade policies change, the real estate market in Canada will have to remain nimble and responsive to keep the market stable and growing.

Precon vs Resale

Real Estate Uncovered – Pre-Construction vs Resale – What’s the best investment ?

One of the biggest dilemmas in today’s Real Estate market is whether I should buy a pre-construction or a Resale. This question is more relevant to investors rather than end users. As end users, it’s a very clear and defined requirement, but when you are an investor, the flexibility is more as the decision is based on the return on investment, not the property’s personal needs.

There is a famous saying, “One shoe doesn’t fit all, “the same way it works in Real Estate. It all depends upon the individual, as every person has a different situation, and his way of functioning is other. Pre-construction or Resale for an investor is a big debatable topic; both have pros and cons. We need to do a deep dive into the investor’s portfolio, risk appetite, availability of funds, retaining power and long-term & short-term goal of investments.

As per the latest reports, Toronto’s new condos market soared at a rate of 33% and the resale housing market all across GTA has gone up by 15.4% as far as sales are concerned. There are limited options for the buyers or investors as the inventory levels are really low, keeping the market’s pace in an upward direction.

Now let’s focus on the real topic, Pre-construction vs. Resale. Based on my experience selling thousands of pre-construction and resale homes and condos, We will share our advice with you. If you feel more inclined towards pre-construction, buying a high-rise or condo is a good idea, but you have to be a little thoughtful about location and market dynamics in the area you are buying. Regarding Resale, purchasing a small investment house is always a good option. Both Resale and Pre-construction have their pros and cons.

RESALE

Advantages:

  1. You immediately get possession within a few weeks.
  2. You can start making rental income directly.
  3. You can physically see the house.
  4. You are not worried about the cancellation of the project as you get your ownership faster
  5. It’s easy to resell as there are not many restrictions.
  6. You can always get a double dwelling unit in Resale for extra rental income.
  7. You can get the refinance after some time and can utilize the money for further investment

Disadvantages:

  1. Your mortgage payments start immediately after the closing
  2. You have to take the trouble to manage tenant
  3. House might need some repairs and maintenance
  4. All the down payment goes almost one time
  5. No leverage of time and money.

PRE-CONSTRUCTION

Advantages:

  1. Leverage of time and money.
  2. The down payment goes in parts.
  3. No mortgage is required immediately.
  4. Opportunity to sell on assignment.
  5. You get possession after a few years, and by the time your property appreciates.
  6. No hassles of tenants until possession of the property.
  7. No maintenance is required until custody; the least maintenance is after control as it’s new.

Disadvantages

  1. You are buying the property on paper only.
  2. Fear of project cancellation as it’s a long gap between purchase and closing.
  3. The mortgage rate might change by the time when you get possession.
  4. No rental income until possession.
  5. Over competition at the time of possession as many units come together in the market.
  6. Many things depend on the builder in the purchase, so you have less control over the situation.
  7. Market conditions might change.
  8. Permit and other regulatory requirements for the builder.

We understand that it’s not easy for a seasoned investor to identify the right investment among so many available; we strongly recommend taking expert advice. Whether pre-construction or Resale, it’s a big decision, and you want to do it right.

If you are looking for a no-obligation one-hour session about How to build your Real Estate portfolio, please get in touch with Our Team, and we will steer you in the right direction toward achieving your goal of Real Estate investments.

Housing Prices

Canadian housing Prices Over The Last 25 Years

 

What’s Your Home Worth Today?

It’s the question on every Canadian homeowner’s mind:
How much has my home appreciated since I bought it?

With property values surging across the country, especially in suburban areas where detached homes now average close to $1 million CAD, it’s no surprise that curiosity about home equity is at an all-time high.

Let’s Look Back: 25 Years of Growth

To understand how far we’ve come, it helps to look back over the last 25 years — roughly the length of a typical mortgage term. In 1996, the average home price in Canada was around $198,150. Fast forward to 2021, and that number skyrocketed to approximately $1,095,419.

It’s a staggering increase — and one that can be better understood using the CAGR (Compound Annual Growth Rate) calculator, a simple online tool that shows how steadily home values have grown over time.

Fun Fact: Back in 1998, “Toronto” included areas like Brampton, Mississauga, Etobicoke, and Scarborough. These are now independent cities under the Greater Toronto Area (GTA), often used for modern price comparisons.

Curious About Your Home’s Current Value?

Use our free “What’s My Home Worth” tool to get an instant estimate.
Or, for a personalized evaluation, simply fill out the form below and one of our experienced local agents will be in touch shortly.

Understanding Real vs. Nominal Growth

While the average home price increase shows a nominal CAGR of around 7.05%, the real value is slightly different. When you account for costs like:

  • Mortgage interest

  • Property taxes

  • Maintenance and repairs

  • Long-term inflation

…the actual net growth may seem lower — but here’s the key: those carrying costs typically reduce over time, while your home’s value keeps rising.

Bottom Line: It’s Still a Smart Move

Even if a 7% annual return doesn’t sound massive, homeownership remains one of the most powerful ways to build long-term wealth. And with your mortgage eventually paid off, your equity and property value continue to grow exponentially.

There’s almost never a “bad time” to buy — only better times to get started.