Benchmark home prices dropped 1.2% in April from a month earlier and were down 3.6% on the year as the country’s real estate market continues to soften.

Home sales were flat in April after four months of decline, and were down almost 10% from a year earlier, the Canadian Real Estate Association reported Thursday. The sales-to-new listing ratio — a measure of the level of demand relative to supply — rose slightly to 46.8% in April, but it still “bouncing around the softest levels since 2009” and the mid-1990s before that, Robert Kavcic, senior economist at BMO, wrote in a research note.

Uncertainty over tariffs has taken the place of high interest rates in keeping potential buyers on the sidelines, Shaun Cathcart, CREA’s senior economist, said in a statement. “Given the increasing potential for a rough economic patch ahead, the risk going forward will be if an average number of people trying to sell their homes turns into a large number of people who have to sell their homes, and that’s something we have not seen in decades.”

“Canadian home prices continued to fall in April, and the weakness is accelerating,” Kavcic said in a separate note. The April drop was the largest since November 2023 and marks the eighth decline in the past 10 months, Kavcic said, adding that the weakness is mostly an Ontario story, “where buyers’ markets are evident across a number of cities.”

From the 2022 peak, prices in much of Ontario, the country’s largest province, are down more than 20% “and still probing cycle lows,” he wrote. “The lack of rebound so far this year reinforces our view that the time back to those previous highs will be measured in years, not months or quarters.”

With April’s soft showing, and weak momentum heading into the quarter, “we’re currently tracking another decline in Canadian home sales in Q2 following their sizable first quarter contraction,” Rishi Sondhi, an economist at TD, wrote in a research note. However, he said history shows the country’s housing market can surge after lulls, and pent up demand, which was already large in Ontario and B.C. before the trade war, could drive a jump in sales if confidence improves later in the year, as TD predicts.