Once again, it is springtime, and springtime all over. Note the budding leaves, note the greening grass, and pay no attention to the occasional bursts of snow. It never sticks. But in Canada, they have noticed one important point of spring missing: the sound of homes being sold. House sales saw their weakest March in over 15 years. But the iShares S&P / TSX 60, (TSE:XIU) felt no fallout, and gained fractionally in Tuesday morning’s trading.
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The problem, not surprisingly, is connected to uncertainty over the tariffs coming out of the United States. While some might think this would not have much impact on Canadian housing prices, it simply did. Home sales were down in March to the lowest levels since 2009, reports note, and house prices were likewise in the doldrums. The outlook for 2025 entire, meanwhile, also looked down, and now, some are wondering if the tariff hits will not end up crippling the entire Canadian economy.
Home sales dropped 4.8% between February and March, noted a report from the Canadian Real Estate Association (CREA), and the first quarter of the year was down about 20% against the high set in November 2024. Most of the declines, the CREA’s senior economist Shaun Cathcart noted, were based mostly around uncertainty. Now, Cathcart noted, the home market has gong from “…a slam-dunk rebound year to treading water at best.”
Manufactured Housing the Key to Success?
And this comes at a time when, according to the Ontario Real Estate Association, Canada is in the middle of a “housing crisis.” How exactly those two conditions—fewer sales and fewer buyers—work in tandem is unclear, but the association believes there could be a simple solution: manufactured housing.
Manufactured housing is nothing new in the United States. Trailer parks have been a thing for decades, and modular homes take things a step up everywhere. Plus, Canada has little shortage of raw materials, like timber and steel, that are vital to manufactured housing. But much of the problem in putting this housing to work comes from government interference, and the association is calling for the reduction of “…red tape and regulatory burdens” accordingly.
Is the iShares S&P / TSX 60 Index ETF a Good Buy Right Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on TSE:XIU shares based on 51 Buys, eight Holds and two Sells assigned in the past three months, as indicated by the graphic below. After a 13.89% rally in its share price over the past year, the average TSE:XIU price target of $42.81 per share implies 16.96% upside potential.
