As we reflect on 2024 and look ahead to 2025, the Toronto real estate market continues to evolve in response to economic shifts, affordability concerns, and government policies. The Toronto Regional Real Estate Board (TRREB) recently released its annual report, outlining key trends, challenges, and opportunities in the housing market.
2024: A Year of Transition
Last year was marked by high borrowing costs and moderate home sales, with interest rate relief finally arriving toward the end of 2024. Home prices remained relatively stable, while buyers cautiously navigated affordability constraints. Rental demand stayed strong as many renters opted to delay home purchases due to high financing costs.
Key Market Numbers: January 2025
Home Sales: 3,847 sales in January 2025 (-7.9% YoY)
New Listings: 12,392 new listings (+48.6% YoY)
Average Selling Price: $1,040,994 (+1.5% YoY)
Projected 2025 Sales: 76,000 homes (+12.4% vs. 2024)
Projected 2025 Average Price: $1,147,000 (+2.6% vs. 2024)
Days on Market: Homes are taking longer to sell due to more inventory
2025 Outlook: Moderate Growth & Market Adjustments
Home Sales & Prices
TRREB predicts 76,000 home sales in the GTA, driven by anticipated further interest rate cuts.
The average home price is forecasted to rise by 2.6% to $1,147,000, with stronger price growth in detached and semi-detached homes compared to condos.
Affordability & Supply Challenges
The "missing middle" housing crisis continues, with a need for more townhomes, duplexes, and purpose-built rentals.
High development charges and land transfer taxes are adding to affordability concerns, prompting TRREB to advocate for tax reforms.
Rental Market Trends
Strong demand for rental properties persists, especially as immigration remains a key driver of population growth in the GTA.
Renters are increasingly considering homeownership, especially if mortgage rates decline further.
Economic Uncertainty & Market Risks
The Bank of Canada’s interest rate strategy will be crucial in shaping market activity.
Potential U.S. tariffs on Canadian exports could impact consumer confidence, job security, and economic stability.
The Toronto housing market is poised for gradual recovery in 2025, with interest rate cuts expected to bring more buyers back into the market. However, affordability, housing supply, and government policies will continue to play a significant role in shaping real estate trends. Whether you're a buyer, seller, or investor, staying informed about market dynamics will be key to making smart real estate decisions in the year ahead.
Thinking about buying or selling in 2025? Contact us today!