The Greater Toronto Area (GTA) housing market experienced a notable shift in September, driven by improving affordability and a corresponding increase in buyer confidence. Following the Bank of Canada’s recent interest rate adjustment, the market saw renewed engagement, allowing more prospective homeowners to navigate financing options and explore the diverse housing inventory across the region.
Market Activity: Sales Outpace Supply Growth
According to data from the Toronto Regional Real Estate Board (TRREB), September 2025 home sales demonstrated a significant year-over-year increase:
Sales Growth: GTA REALTORS® reported 5,592 home sales, an 8.5% increase compared to September 2024. This signals a welcome return of buyers previously on the sidelines due to high borrowing costs.
Supply Dynamics: While new listings also rose by 4% year-over-year (19,260 listings), the pace of sales growth was stronger than the increase in supply.
Month-over-Month Trend: On a seasonally adjusted basis, September sales were up from August, while new listings actually declined. This suggests a potential tightening of market conditions in high-demand areas, particularly in established communities across Toronto, Vaughan, Markham, and Richmond Hill.
Expert Commentary on Affordability
TRREB President Elechia Barry-Sproule noted the direct impact of the rate decision: “The Bank of Canada’s September interest rate cut was welcome news for homebuyers. With lower borrowing costs, more households are now able to afford monthly mortgage payments on a home that meets their needs.” This improved affordability is anticipated to have a positive ripple effect, supporting related economic activity such as home renovations and local service consumption.
Price Stability on the Horizon?
Despite the rise in sales, aggregate home prices continued to adjust compared to the previous year, offering buyers favorable conditions.
Year-over-Year (YoY) Prices: The MLS® Home Price Index (HPI) Composite benchmark was down 5.5% YoY, and the average selling price decreased by 4.7% to $1,059,377 compared to September 2024.
Month-over-Month (MoM) Stability: A closer look at the MoM figures suggests prices may be finding a floor. The average selling price was virtually flat from August (up 0.2%), and the HPI Composite only edged down 0.5%. This indicates a potential stabilization as greater demand absorbs available inventory.
Strategic Outlook for Buyers and Sellers
The current environment presents distinct opportunities for both sides of the market:
For Buyers: The fall market offers a strategic advantage: lower interest rates, continued strong selection, and a potential window for negotiation. However, sustained demand coupled with slowing new listings could lead to increased competition moving forward.
For Sellers: Strategic and realistic pricing remains paramount. Well-maintained and properly positioned properties continue to attract qualified buyers, especially those located near key amenities, transit, and quality schools.
TRREB’s Chief Information Officer, Jason Mercer, also emphasized the long-term context: “Two more 25-basis-point interest rate cuts by the Bank of Canada would see monthly mortgage payments move more in line with homebuyers’ average incomes, further spurring home sales and related economic activity.”
In summary, the September GTA market showed encouraging signs of recovery driven by improved financial accessibility. While the market is still below its long-term historical norms, the combination of rising sales and stabilizing prices suggests a foundation is being set for future growth, contingent upon ongoing economic stability and rate decisions.
Stay Informed
Understanding the nuances of the GTA market is critical for making informed real estate decisions.
If you are considering a purchase, leveraging the current buyer-favorable conditions requires timely market insight.
If you plan to sell, a refined, data-driven strategy is essential to maximize your property's value as demand continues to rise.
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