Good morning. Canada’s comatose real estate market may have just twitched its finger. For the first time in six months, home sales rose across the country last month. Not only that, but home prices also stopped falling in May at a national level. Today, we’ll consider what this means at a pivotal moment for Canadian housing. But first, what happened today at the G7 summit:

Prime Minister Mark Carney accelerates talks with U.S. President Donald Trump to reach economic-security deal within 30 days.

Alberta and Saskatchewan premiers push for port-to-port corridor as Carney touts energy security at G7

Leaders to collaborate on critical mineral supply chains in an effort to reduce their reliance on China

Africa largely sidelined at G7 summit, despite multiple wars and massive aid cuts

Up next: Ukrainian President Volodymyr Zelensky is expected to arrive on the final day of the summit.

• Today: U.S. retail sales figures could point to softness in part owing to a drop in auto sales
• Tomorrow: The U.S. Federal Reserve is expected to hold interest rates where they are

It wasn’t supposed to be like this. A tough year for residential real estate has unfolded even as interest rates have declined substantially.

A homebuyer today can get a five-year fixed rate mortgage at around 4 per cent, compared with closer to 6 per cent a couple of years ago. Under normal circumstances, such a big move would be a major stimulant to housing demand.

It hasn’t gone that way at all. The overhang of tariffs, trade tensions, unemployment and general economic hardship have cast a huge shadow over Canadian housing this year.

Buyers have firmly planted themselves on the sidelines. You can’t really blame them. You might be a tad cautious about making the biggest purchase of your life if there’s a chance you could lose your job. Or if you think that same house will be cheaper by the end of the year.

After all, the average price of a home in Canada is nearly 20 per cent off its peak. And no one wants to try to catch a falling knife, to borrow an investing cliché.

But wait!

The numbers for May are in and they are not abjectly terrible. National home sales rose by 3.6 per cent over the prior month, according to data from the Canadian Real Estate Association.

The national home price index, meanwhile, was essentially flat at around $690,000, ending three consecutive months of declines of close to 1 per cent.

Commentary from CREA also hinted at the uptick continuing into June.

It all suggests that “confidence is beginning to return to the market following the tariff-induced shock earlier in the year,” Paul Ashworth, chief North American economist at Capital Economics, said in a note.

A national obsession

Canada’s addiction to real estate is well documented. It famously persisted through the global financial crisis and the COVID-19 pandemic, en route to a wild run-up in prices that lasted a couple of decades or so.

It was an unhealthy dependency, which sparked an affordability crisis, while sapping the rest of the economy of investment capital that could have gone to better use.

Some economists have even welcomed the reckoning that has befallen the housing market this year, if for no other reason than it has made the average home more affordable.

And yet, housing is an important component of the national economy — one that has helped Canada get through some tough times. “It’ll be tough for housing to cushion the trade war pain in the same way that it offset economic trauma early in the COVID-19 pandemic,” writes The Globe and Mail’s Tim Kiladze.

Perhaps the winds are shifting once again, if May’s numbers are an early indicator. So what now? Are Canadians poised to take up their other great national pastime again?

Let’s not get carried away

It’s just one month. Even with the rebound in May, sales are still down by 11 per cent year to date, Ashworth said.

But this could very well prove to be the turning point. More rate cuts are probably on the way this year courtesy of the Bank of Canada, which should help shore up any fledgling recovery.

“At this point I’d say the market is looking like it is forming a bottom,” said