Spring 2025 Canadian Real Estate Market Projections: Trends, Tariffs, and Regional Insights

The Canadian real estate market is heading into spring 2025 with cautious optimism. From coast to coast, each province is navigating a unique combination of economic forces, local housing dynamics, and now, new U.S. tariffs taking effect on April 2, 2025. This blog offers detailed, province-by-province projections for buyers, sellers, and investors, while factoring in the economic weight of the looming trade changes.

National Snapshot: A Market in Transition

According to the Canadian Real Estate Association (CREA), the national average home price is expected to rise by 4.7%, reaching $722,221 by the end of 2025. This growth, however, is unevenly distributed, and influenced by factors such as inflation, interest rates, housing supply, and now, cross-border trade volatility.

"There’s no one-size-fits-all in 2025. Regional divergence will define Canada's housing market outlook," says Robert Kavcic, Senior Economist at BMO Capital Markets.

Provincial Outlooks for the Spring 2025 Canadian Real Estate Market

British Columbia

• Price stabilization expected due to buyer caution, particularly in Metro Vancouver, Victoria, Kelowna, Kamloops, and parts of the Fraser Valley where demand has cooled due to ongoing affordability challenges and a rise in available inventory.

• Vancouver’s condo market shows softness, driven by high home prices, increased inventory, and reduced investor activity.

• Tariff Impact: U.S. tariffs could increase construction costs for steel-heavy urban builds, though the recent removal of interprovincial trade barriers may help offset some of the price pressure by improving supply chain efficiency and allowing access to alternative domestic sources such as steel producers in Ontario (Hamilton, Sault Ste. Marie), aluminum from Quebec (Saguenay–Lac-Saint-Jean), prefabricated building materials from Alberta and Manitoba, engineered wood and modular housing systems in British Columbia, and construction aggregates and raw inputs from Northern Ontario and Northern Quebec.

Alberta

• Strong demand continues in Calgary, Edmonton, Red Deer, Lethbridge, Grande Prairie, and Fort McMurray, driven by interprovincial migration, employment growth in energy and construction, and relative affordability compared to larger national markets.

• Average price rose to $509,468 (+5.7% YoY).

• Tariff Impact: Rising material costs could curb new developments and pressure entry-level homebuyers, though improved interprovincial trade may ease supply constraints and help stabilize project costs by facilitating access to prefabricated housing materials and steel components from Ontario and Manitoba.

Saskatchewan

• Home prices up 12.9% year-over-year, with affordable housing and stable job markets attracting buyers.

• Balanced market conditions continue in Regina, Saskatoon, and Prince Albert, with stable demand supported by public-sector employment and lower average housing costs.

• Tariff Impact: Higher costs on prefabricated materials could affect rural builds and modular housing, though recent trade reforms may help reduce delivery delays and procurement barriers, especially for materials sourced from Alberta and Manitoba.

Manitoba

• Average price at $356,000, increased by 10.3% compared to the same time last year, with first-time buyers active in Winnipeg.

• Winnipeg sees modest inventory growth, while Brandon and Steinbach are gaining attention from buyers seeking affordability outside the capital.

• Tariff Impact: Indirect effects from increased cost of materials could slow smaller-scale developments, although streamlined interprovincial trade may help reduce material bottlenecks by improving access to steel from Ontario and building supplies from the Prairies.

Ontario

• Ontario’s housing sector is closely tied to its domestic steel production hubs in Hamilton and Sault Ste. Marie, where rising input costs are expected to affect construction budgets and timelines across major urban markets.

• GTA prices are cooling slightly due to stricter mortgage qualifications, and buyer fatigue, along with an increase in resale listings and a growing supply of new condos. Similar softening trends are seen in Ottawa, Hamilton, and Kitchener-Waterloo for many of the same reasons. In Northern Ontario, markets such as Sudbury, North Bay, and Thunder Bay remain more stable, supported by local employment in mining, infrastructure, and public services, although affordability concerns are beginning to emerge.

• Tariff Impact: Tariffs will significantly increase costs for urban high-rise construction, possibly limiting new supply, though enhanced trade access between provinces could mitigate some sourcing challenges by enabling procurement from domestic suppliers in Quebec, Alberta, and Manitoba.

Quebec

• Price growth of 7.7% (avg. $515,899 in Feb 2025) driven by Montreal and Quebec City.

• Markets remain resilient but are showing early signs of normalization due to increased supply and buyer caution, including emerging signs of tapering demand in Sherbrooke and Lévis.

• Tariff Impact: Major aluminum-exporting regions like Saguenay–Lac-Saint-Jean will feel direct economic strain, though improved domestic trade may support secondary markets and local supply chains by fostering stronger links with provinces demanding aluminum-based components.

New Brunswick & Prince Edward Island

• Moderate growth and rising demand due to affordability and intra-provincial migration.

• Smaller urban centres like Moncton, Charlottetown, and Fredericton are seeing stronger activity than rural regions, supported by inbound migration and infrastructure spending.

• Tariff Impact: Rising import costs may slow rural developments and infrastructure projects, but reduced interprovincial trade friction could provide new sourcing options from mainland suppliers in Quebec and Ontario.

Nova Scotia

• Average price $451,969 (+6.7% YoY), driven by continued population growth and urban demand in Halifax, with additional momentum building in Sydney and Dartmouth.

• Affordability pressures and increased competition are starting to slow price acceleration.

• Tariff Impact: Increased costs on construction materials could tighten supply in both urban and suburban areas, although new trade efficiencies may support material access across regions, particularly through better coordination with producers in Ontario and Alberta.

Newfoundland and Labrador

• Stable market with localized price gains, particularly in St. John’s, with Corner Brook and Mount Pearl also seeing modest gains.

• Slower economic recovery and limited population growth are keeping demand moderate.

• Tariff Impact: Minimal direct effect from tariffs, but higher material costs could slow government infrastructure projects and commercial builds, though internal trade improvements may ease sourcing for remote areas by opening supply channels from central Canada and the Prairie provinces.

Interprovincial Trade and Federal Reforms

The impact of U.S. tariffs has also reignited attention on Canada's internal trade barriers. While some federal-level restrictions have been reduced in recent years, many provincial barriers—like differing building codes, trade certifications, and procurement rules—still disrupt the efficient movement of goods and labour across Canada.

However, in a significant policy shift, Prime Minister Mark Carney announced on March 21, 2025, that Canada aims to achieve free internal trade by July 1, 2025. This federal initiative includes:

• Harmonizing standards across provinces

• Mutual recognition of regulations and qualifications

• Streamlining cross-border material and labour movement

"Eliminating interprovincial trade barriers is Canada’s low-hanging economic fruit. For real estate, this means faster builds, better supply chains, and more housing inventory," says Goldy Hyder, President & CEO of the Business Council of Canada.

If fully implemented by the federal target date of July 1, 2025, these changes could reduce trade costs by up to 15% and significantly improve housing development timelines—especially in remote or rapidly growing regions.

Market Perspectives

For Buyers: Why Spring 2025 Could Be Your Smartest Move

• According to Shaun Cathcart, Director and Senior Economist at the Canadian Real Estate Association (CREA), "Many markets in 2025 are seeing a more balanced landscape. This presents real opportunity for informed buyers." Strategic buyers will find leverage in regions with softening prices such as Ontario—particularly in the GTA, Ottawa, Sudbury, and Thunder Bay—where increased inventory and affordability challenges are creating negotiability. British Columbia markets like Metro Vancouver, Victoria, and the Fraser Valley are also seeing price stability or downward pressure due to higher supply and reduced competition.

• Fixed-rate mortgages are recommended by economists like Sherry Cooper, Chief Economist at Dominion Lending Centres, who notes that "locking in now can provide insulation against mid-year volatility." Market absorption times remain extended in these regions, offering breathing room for purchase decisions.

• The federal government has also introduced targeted incentives for first-time homebuyers in early 2025, including a revamped First Home Savings Account (FHSA) with a new annual contribution limit of $12,000 (up from $8,000) and a lifetime maximum of $60,000. Eligibility applies to Canadian residents aged 18 and over who have not owned a home in the past four years.  

• The federal government also introduced a targeted GST rebate for first-time homebuyers purchasing newly constructed homes under $750,000. This measure aims to improve affordability and stimulate new housing supply in urban markets where construction activity has slowed. Eligible buyers can now recover 100% of the GST paid on qualifying purchases, which can result in savings of up to $26,250 per home.

For Sellers: Capitalize on Hot Markets Before They Shift

• Hot markets like Alberta and Nova Scotia continue to offer seller advantages due to persistent demand and limited inventory. The federal government’s early 2025 launch of the Canada Housing Infrastructure Fund offers new momentum by funding municipalities that accelerate zoning and servicing approvals, boosting neighbourhood desirability and helping maintain strong resale values in growing communities.

• Sellers should price strategically to stay competitive in increasingly price-sensitive environments, particularly in areas where new developments may now progress faster due to streamlined federal infrastructure funding, including suburbs of Calgary, Halifax, Ottawa, and mid-sized centres such as Kelowna and London. John Pasalis, President of Realosophy Realty, emphasizes, "Markets like Calgary are still in growth mode and offer sellers a strong position—if pricing is realistic."

For Investors: Federal Incentives + Market Timing = High Potential ROI

• Long-term growth remains favourable in regions benefiting from job creation, housing demand, and infrastructure investment—particularly Alberta, Atlantic Canada, and select Ontario markets. Investors are also eligible for newly extended federal incentives such as the expanded Rental Construction Financing Initiative (RCFI), offering low-cost loans for multi-unit rental developments in high-growth urban centres.

• With construction starts slowing and permit volumes declining in several major urban centres, including Toronto, Vancouver, Calgary, and Halifax, investors should monitor supply constraints and target existing inventory. "Single-family building permits are cratering right now, and that means less new supply on deck over the next couple years," says Ben Rabidoux, housing analyst at Edge Realty Analytics.

• Diversifying across growth corridors and capitalizing on stalled developments could offer strong yield potential through 2026. Additional tax advantages from the new accelerated capital cost allowance (ACCA), announced in Budget 2025, allow for faster depreciation of rental property investments, improving returns. Real estate investors may also benefit from trade reforms that reduce material sourcing delays and development costs across provincial borders.

The spring 2025 Canadian real estate market is expected to be shaped by a mix of regional growth, policy reform, and global economic pressures. From housing affordability issues to supply constraints and cross-border trade disruptions, stakeholders must approach the season with data, flexibility, and local insight. Each province presents a different opportunity—and risk.

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