President Trump’s tariffs and the ongoing trade war may have reduced the herd of Canadian homebuyers eyeing U.S. properties, but they haven’t stopped severe real estate closings.
An interesting split emerged in the data. While online searches remain below pre-tariff levels, RBC Bank’s mortgage originations are flat to slightly up compared to a year ago, suggesting Canadians who continue to shop are making purchases.
“They’re not just asking me what interest rate I need, but how do I protect myself from currency fluctuations, U.S. inflation and policy uncertainty,” Hatim Tihout, head of real estate lending at RBC Bank, told Inman.
Hatim Tihout
The change reflects a market reshaped by 14 months of tariff tensions, a weakening Canadian dollar and political ties between the two countries that have spooked even buyers who ultimately moved forward.
Traffic reduction and partial recovery
Canadian online traffic to Realtor.com’s U.S. properties fell from 41.8% of total international traffic in the first quarter of 2024, before the U.S. imposed significant tariffs on Canadian products, to 34.8% in the first quarter of 2025, according to Realtor.com’s International Demand Report released in May.
By the first quarter of 2026, its share had recovered to 37.8 percent, making Canada the number one source of international home shopping demand in the United States, ahead of Mexico (6.4 percent), the United Kingdom (5.9 percent), Germany (3.9 percent), and Australia (3 percent).
The recovery is concentrated in the Sunbelt and Southwest metros. Cape Coral, Florida led all markets with 71% of international demand coming from Canadian shoppers, followed by Naples, Florida (70.9%), Phoenix, Arizona (66.9%), Northport, Florida (66.2%) and Tampa, Florida (58.8%).
Among these same markets, Canadian interest recorded the largest year-over-year growth, with Cape Coral increasing by 9.2 points, Naples by 8.8 points, and Phoenix by 6.7 points during the first quarter of 2025-2026.
Rebounds are not uniform. Realtor.com reports that Canadian interest in Atlanta and Chicago continues to decline year-over-year, with several markets, including Atlanta, Detroit, San Diego and Riverside, Calif., remaining down more than 5 percentage points compared to pre-tariff levels in early 2024.
What Canadians Think
According to the RBC poll, 11 per cent of Canadians said they were looking to own or already owned real estate in the United States, a number that was higher than expected given the current environment, Tishaw said.
According to the poll, the top motivations are quality of life (35%) and retirement planning (28%). However, barriers remain significant.
29% of Canadians say buying real estate in the U.S. is too complicated or expensive, and 37% say they don’t know enough about the process. Property price (27%), exchange rate (25%), and secondly property maintenance costs (24%) were ranked as the biggest factors in their decision-making.
Tichot said the perception that it’s “too complicated” is largely driven by closing cost sticker shock. Canadian buyers arrive at the U.S. process accustomed to a more predictable cost structure domestically and unaccustomed to transfer taxes, HOA fees, title insurance, origination fees, etc. that vary by state and county.
“They can be in shock sometimes,” Tihout said, noting that the cost of insurance in the Florida coastal market is causing some Canadian buyers to move inland or to lower-tax counties.
The exit timeline is another point of friction. Canadian home loans can close in 7 to 10 business days. Thirty to 45 days is the norm in the U.S., a gap that catches Canadian buyers off guard when trading in a competitive market, Tihout said.
Funding shift
One of the most obvious behavioral changes Tihout has observed is a decline in cash purchases. As the U.S. dollar appreciated against the Canadian dollar, the exchange rate at the time of the interview was approximately CAD 1.35 per U.S. dollar. Exchanging large amounts of money has become an expensive proposition.
“Cash purchases have decreased because of the conversion to the U.S. dollar,” Tihout said. “Buyers want more structure and financing so they can maintain liquidity.”
RBC Bank offers US dollar-denominated mortgages to Canadian buyers using Canadian credit history and income. No U.S. credit history is required and down payments for vacation properties are as low as 20%. This product is structured as a variable rate mortgage with no prepayment penalty, allowing borrowers to make lump sum payments without incurring fees when the Canadian dollar strengthens.
Tishaw said even wealthy clients who can pay in cash are being advised by financial planners to hold on to their investments, take out loans instead and gradually convert smaller amounts into cash as exchange rates move in their favor.
who is buying
Canada’s active buyers in 2026 are not retirees from previous cycles. Tishaw said the core profile is employed or self-employed Canadians in their mid-30s or older who are purchasing vacation properties that they plan to use for at least two to three months a year, often including a rental element.
Retirees who bought years ago are now refinancing to access renovation funds rather than entering the market as new buyers.
Young people are also emerging. Tichot said there is growing interest from Canadians in their late 20s to early 30s who are looking for cash-flowing U.S. investment properties, but it’s becoming increasingly difficult to find in the Canadian market.
Tihout said Florida remains the primary destination and accounts for the majority of RBC’s Canadian mortgage volume, with Arizona, Hawaii and California rounding out the top four markets. He said affordability in the Sunbelt compared to Canada’s major metros is a recurring factor, similar to the buyer’s market dynamics that currently exist in parts of Florida, where price reductions that weren’t previously available are attracting long-awaited buyers.
political issues
Tihout said political tensions between Canada and the U.S. are of interest to buyers, but are not deterring buyers who are actively seeking information from moving forward.
“Some customers are still dissatisfied with what’s going on between Canada and the U.S. from an economic standpoint, that’s clear,” he said. “But what we’re dealing with really looks beyond the current moment.”
He said some clients are comparing the current environment to the period after the 2008 financial crisis, when U.S. real estate values fell and Canadian buyers who bought at rock-bottom prices saw big increases. He said the framework reflects a calculation that long-term market fundamentals outweigh short-term political frictions.
What US agents are missing
In a presentation at real estate brokerage shows in Houston and Orlando, Tihout said U.S. agents often don’t know that Canadian banks can finance their clients’ purchases in the U.S., and that they need a pre-approval letter from those banks to make an offer.
“They didn’t know we could do it,” he said.
Beyond financing, he said Canadian buyers need more up-front education than U.S. agents typically provide. Canadians rely on their agents to outline not only what’s in the property, but also the overall costs, including property tax history, insurance exposure, HOA rules, and a realistic closing schedule. Agents who take control with that information can build trust faster and close deals more reliably, he said.
Tihout also warned that there are special opportunities for agents working with wealthy Canadian clients. Many agents arrive intending to pay in cash without understanding the exchange costs involved in that decision. Explaining to clients how to calculate currency conversions and introducing finance as a way to reduce currency exposure is an added value that few US agents currently offer.
“Make sure they understand the currency impact,” he says. “It’s not productive to pay cash when you can keep your capital.”
Email Jesse Healy
