While the tariff threat has made many economists, housing experts, and prospective homebuyers nervous over the housing market’s future, we may be better off than we think. Last week, we spoke about how the Trump tariffs can have impacts on our housing market through the increase in building costs, namely by the increased cost of materials like steel and lumber, costs which would then be passed onto the homebuyer when purchasing the home. While the current tariff situation seems volatile and is rapidly changing, the fear mongering can often get into our heads and create a sense of hopelessness. Today, let’s talk about how despite all the chaos, the housing market may still improve.A few days ago, on March 12, the Bank of Canada made further cuts to the interest rate, leaving it at 2.75%. The Toronto Star calls this rate cut “a silver lining for homeowners.” According to CBC, the Bank of Canada’s Governor Tiff Macklem cited the ongoing Canada-USA trade war as a reason. He stated that while the economy started off on a high note this year, “tariff uncertainty caused by the on-again off-again trade war” has “weighed on business spending &amp; hiring, &amp; shaken consumer confidence.” The big concern, according to Macklem, is uncertainty. The tariff threats from the United States seem to be changing every day, and many consumers don’t know how to respond. In light of this, Global News cites Penelope Graham, a mortgage expert, who states that the interest rate cut can improve affordability and offer some comfort to current and prospective mortgage payers who will now be paying less every month. Additionally, as the tariff threats continue to ebb, flow, and change entirely, Global News expects the Bank of Canada to make further cuts.&nbsp;BNN Bloomberg says the homeowners who will likely be benefitting the most by the interest rate cuts during this looming trade war are those with variable mortgages. Leah Zlatkin, another mortgage expert, says that the rate cut is a potential source of relief for those with variable mortgage rates, as they will see an immediate decrease in monthly payments. BNN Bloomberg says that those with more stable employment may benefit from opting for a variable mortgage plan. Of course, the tariff situation may adversely affect the employment of many Canadians. Regardless of whether people opt for fixed or variable rates, BNN Bloomberg says that the uncertainty caused by the tariff war will scare many potential homebuyers away from entering the market. While mortgage expert Ron Butler says that he expects mortgage demand to decline, leading to a “grinding down” of house prices in provinces like Ontario and British Columbia. Butler said the impact will vary across the country, but added he thinks “we’re going to see that translate into lower house prices in Ontario, it’s almost unavoidable.” Others, including the President and CEO of Royal Le Page, Phil Soper, say that the housing market tends to be insulated from trade disputes, and will remain resilient in the long term.&nbsp;The Financial Post also adds that the decrease in demand can ultimately benefit potential homebuyers, a little later down the road. They cite the Canadian Real Estate Association, who reports that sales activity dropped 3.3% in January, but listings increased by over 10%.Overall, it seems that in the face of the tariff war, we shouldn't lose hope just yet. While the uncertainty created by threats to our economy is incredibly frustrating, especially for the younger generation who are trying to jumpstart our lives, it seems there is a light at the end of the tunnel. The greatest opportunity is easy to see when looking backward. It may be just now.The reality is that life will go forward. People move. They upsize their homes. They downsize their homes. But through it all we know that things will get better; because they always get better. Those with faith and commitment will be rewarded.

We’re Still Lucky: Canada’s Housing Market Despite Tariffs

Despite tariff threats and market uncertainty, Canada’s housing market may improve thanks to interest rate cuts, offering hope for homebuyers and homeowners alike.

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