The
Toronto real estate market in 2025 was marked by two distinct phases.
The first half faced political and economic uncertainty—Prime Minister’s
resignation, tariff concerns, and provincial/federal elections—creating
prolonged instability and dampening buyer confidence. Interest rate
cuts by the Bank of Canada failed to offset this uncertainty.
The second half saw stabilization with more inventory and improved
affordability, but consumer confidence remained the biggest barrier.
Overall, the market couldn’t fully recover from early disruptions
Market Performance Metrics
GTA
REALTORS® reported 62,433 home sales in 2025, down 11.2% from 2024. New
listings rose 10.1% to 186,753, reflecting increased seller activity
amid weak demand. The average price fell 4.7% to $1,067,968.
Freehold homes outperformed, while condos
lagged. Detached and semi-detached homes held up better than historical
norms, but high-rise condos saw the steepest price declines.
Pre-construction activity stalled throughout the year.
2026 Market Outlook
Recovery will vary by segment. Interest
rates should remain stable, with confidence—not borrowing costs—driving
activity. Long-term MLS sales average near 90,000, highlighting pent-up
demand. Economic development and trade stability will be key to
restoring confidence. Year-over-year gains are expected as 2026
progresses.
Rental Market Outlook
High construction costs and development fees
have shifted projects toward rentals, but delivery remains years away.
Short-term rental choice has improved, but rents will stabilize before
tightening later in the year as supply constraints persist.
SUMMARY
2025 was shaped by uncertainty and weak confidence,
leading to lower sales, higher inventory, and modest price declines.
Freehold homes outperformed condos, while pre-construction slowed
sharply. In 2026, recovery will be uneven: freehold segments will
rebound first, condos later. Pent-up demand and limited future supply
create opportunities for informed buyers as confidence returns.
Want to stay up-to-date on the Toronto Real Estate Market?
If you are interested in the Toronto Real Estate Market then this Report is for you. Released on a monthly basis, our Market Report lets you in on the changes and fluctuations in the real estate market
