The slowness I predicted earlier in the year continued into March, a month where sales activity normally picks up heading into the busiest part of the year for our real estate market. There’s absolutely no question that people are afraid of what is going on south of our border, something completely understandable given the huge impact the American economy has on ours.
Price movement in the real estate market is relatively sluggish compared to the stock market and prices have held up surprisingly well in the face of very slow conditions here in Waterloo Region. Prices are up modestly in every segment except semis compared to February. But the increases we saw were not matched YOY, with prices down in every category relative to March of 2024. This is not at all surprising given the very slow sales volumes we are seeing. In a more typical spring, there’d be a more substantial increase in price and sales volume.
Those volumes were down substantially. Total sales in the 4 categories came in 23% lower than last March and 45% lower than the 10-year average for the month. As a result, inventories are up considerably. The only segment that remains a sellers’ market is semis with 1.8 months of stock. Townhomes and detached are both in neutral category with 4.8 and 3.1 months of available inventory. Apt condos are well into buyers’ market status at 7.5 months of unsold units. See my board’s take on things here.
Fear and uncertainty are ruling the roost at the moment, with massive declines in the stock market since Trump took power. But I believe that the path to isolationism the US is taking is simply not possible in today’s world. The global economy is too intertwined. At some point in the not-too-distant future the business community and public will push back due to the inevitable economic hardship Trump’s tariffs are causing. If we are lucky, cooler heads will prevail and the US will reverse course.
Once that happens, we should see a return to normal, but somewhat muted market activity. People will still need to buy and sell properties, that isn’t going to disappear. Retirements and downsizing, career changes, divorces and new additions to growing families are facts of life no matter what is going on south of our border.
