Redfin head of economic research sees sharp decline in potential buyers from Canada
The number of Canadians considering buying a home in the United States dropped sharply in May compared to the previous year. While affordability was a contributing factor, a Redfin economist believes tariffs and the political discourse directed toward Canada played a large role in the decline.
A Redfin report showed the number of Canadian Redfin.com users searching for homes in the US dropped 26.4% year over year. The website noted that the total number of buyers and renters also declined in the same time period, but by a fraction of the amount.
Chen Zhao (pictured top), head of economic research with Redfin, said the data points to a major drop after the tariffs were implemented on Canada, and President Trump started calling for the annexation of the country as the “51st state.” Even though other economic challenges were at play, Zhao downplayed their involvement in the drop.
“A very small part of the drop is related to general housing market weakness because overall Redfin traffic was also down, but just a small fraction relative to the 26% drop in Canadian traffic,” Zhao told Mortgage Professional America. “General currency weakness could be playing a role here, as a weak Canadian dollar would have the same effect, but the timing doesn’t line up with our traffic data.
“The Canadian dollar weakened against the USD throughout the fall and winter, reaching a trough in early February, but gaining strength after that. It was weaker in April than in December and January, but traffic was much weaker in April than in January.”
Major drops in metro areas
The report showed major declines in large cities. Searches for homes in Houston dropped 55.2%. In Philadelphia, the decline was 53%. In Chicago, there were 47% fewer searches year over year.
Markets that typically attract Canadians looking to escape the harsh winter also saw declines. Miami and Orlando experienced a 30% decline, while Phoenix and Riverside, California, saw a 23% decrease each.
“I haven’t worked with a Canadian buyer in at least a year,” Marsha McMahon-Jones, a Redfin Premier agent in Palm Springs, said in the press release. “I’m in touch with a few potential buyers, but they’re staying put in Canada for now with the idea of potentially making a move if and when Canada-US relations improve. I haven’t heard of any Canadians who already live here part of the year listing their Palm Springs home, though.”
The drop in May followed a 34.2% year-over-year decline in April. Some potential buyers are concerned about how easily they would be able to travel between the two countries.
“Normally, I work with about five Canadian buyers each spring, mostly older folks looking for a second home. This year, there were none,” Heather Mahmood-Corley, a Redfin Premier agent in Phoenix, said in the release. “People from Canada are retreating from owning real estate in the U.S. because of political tensions; some of them are worried it will no longer be practical to travel back and forth between the two countries, and some don’t want their money tied up in the US.”
Zhao believes that while there was an overarching aversion to coming to the United States, there was also a desire to avoid areas that heavily support the current president.
“It could be a number of different factors, but one possibility is that Canadians might be more reluctant to look for real estate in parts of the country that supported President Trump to a greater extent in the election,” Zhao said.
Largest group of international homebuyers
Canadians comprise the largest portion of international homebuyers. In 2024, buyers from Canada accounted for 13% of foreign buyers, accounting for $5.9 billion worth of US real estate.
Overall, Canadians don’t make up a large portion of the US housing market. However, in markets where home sales have slowed, Zhao believes this could be another factor in the slowing growth of house prices.
With president Donald Trump’s self-imposed trade deal deadline set for Wednesday, mortgage analysts and brokers are bracing for potential ripples across the economy.https://t.co/KsSGP8cLCa
— Mortgage Professional America Magazine (@MPAMagazineUS) July 8, 2025
“Nationally, Canadian buyers only account for 0.28% of existing home sales in the US according to NAR data,” she said. “So, less demand from Canadians matters, but it won’t be a huge impact. Of course, Canadian buyers will matter more in certain markets. To that end, we should expect fewer sales and weaker price growth in the markets that see more activity from Canadian buyers.
“We’re already seeing that price growth everywhere is slowing down, so this is just pushing in that same direction.”
When asked whether the new crackdown on immigration might be affecting home searches, Zhao said that wasn’t showing up in Redfin’s numbers yet.
“We haven’t seen any evidence of home buyer demand changing as a result of immigration policy yet,” she said.
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