So bad it’s good?
The plot thickens.
Canada will be in election mode within (maybe) hours. Tariff Day is exactly two weeks out. Inflation has spiked. Trump just dissed Poilievre. The polls are gyrating. People are freaking out over layoffs and $21-a-bottle olive oil. The Bay is toast. Economists are expecting a drop in retail sales and (they whisper) a recession. The US treasury secretary himself is talking about a period of ‘detox’.
Well, Tariff Man may or may not whack us again. So far it’s been more bluster than bite. But our steel and aluminum exports are now being punished. The Chinese are at it, too. Effective tomorrow our key canola shipments will be taxed at 100% – punishment for keeping cheap EVs from arriving. Trade wars are bad news for everybody. But, sigh, here we are.
One canary in the coalmine is residential real estate.
Yesterday we detailed some reasons things are going south. Sales, listings and prices are fading. New home construction has crashed. An icy fear threatens the traditional Spring market. Good props in demand areas still sell but condos do not. First-time buyers have all but vanished, despite the most generous borrowing and financing regs in decades.
The hairshirts, nihilists, Debbie-downers and moaning doomers oddly attracted by this manly blog think we’re on the verge of an historic collapse. Prices, they say, will plunge. Recession will become stagflation and morph into depression. Recent buyers will be tossed into Elon’s wood chipper. Sellers will drown in their own tears. And the US president will have done what our own government could not – drop real estate values by half. Yeah, he’d also burn down the economy, but what the heck? All girls want is a bungalow.
But wait. Is this also an opportunity?
Of course. Inside every reversal, disappointment, hurt and crisis lurks a chance to do better. It’s something you learn after living through decades of volatility. Things seldom (if ever) turn out the way they seem to be headed. And I’ve yet to mutter, “it’s different this time”, and be right.
At this moment the construction industry is forecasting collapse and mayhem. The Bank of Canada is telling you to duck. Every week a new residential condo development is cancelled. The layoffs have started with metal fabricators, furniture builders, machine shops and manufacturers. Lately we’ve told you about tradespeople forced to use liens against non-paying, stressed customers amid the worst conditions in a quarter century. Housing starts are down 68% in the GTA and 48% in Van. Inflation’s back. So is unemployment.
All true. All depressing.
But that’s only part of the story.
The Trump assault is being demonstrably positive for this country.
It’s taken only a few weeks of tariff insanity and brainless talk of ‘annexation’ and 51st state to bring Canadians together, get people actively buying goods from each other instead of the USA and supporting domestic enterprise. Already Ottawa and the provinces are working on eliminating trade barriers within the country. The new PM decided his first trip would not be on bended knee to Washington or Mar-a-Lago, but instead to Paris and London to cement relationships and talk about diversifying trade. Our pneumatic foreign minister has seduced the American mainstream media in a way hitherto unknown for a Canadian politician. And when was the last time you saw 13 provincial and territorial leaders all chummy, united and moving forward together?
Yeah. Never.
So there’s reason to think we might come out of this mess stronger, more insulated from the dorks in Congress and the Oval Office and finally bury the divisive, corrosive ‘Canada is broken’ meme we’ve had to endure for the last two years. It isn’t. Never was. But we can do better.
Practically, interest rates – and mortgage costs – will come down more because of all this. Real estate values, especially for urban condos, will fall further until the first-timers are able to scramble onto the property ladder. A weakened Canadian dollar will allow us to sell better into the world. And the more America looks like a dumpster fire, rife with political retribution, gutted government services, polarization, zany leadership, oligarch influence, dictator envy and an insane mix of imperialism and isolationism, the brighter shines Canada. Stable. Democratic. Resource rich. Boring and the sexiest half of North America.
Do things look dark today?
You bet.
Will they get darker?
No doubt.
Ready the chequebook.
About the picture: “No more cats on the blog, please,” writes Paul. “Now’s not the time. So, meet Lucky. He turned one on (yup) Feb 1.”
To be in touch or send a picture of your beast, email to ‘garth@garth.ca’.
Source: https://www.greaterfool.ca/2025/03/19/so-bad-its-good/
