The Toronto housing market is expected to reach a more balanced state in 2025. Average home prices are projected to rise marginally by 0.1%, while sales activity is anticipated to increase by 12.5%. However, the total number of listings is forecasted to decrease slightly.
Move-Up Buyers and Investors: These groups are predicted to dominate sales activity in 2025, with single-detached houses remaining the most sought-after property type.
Heading into 2025, sellers are feeling more optimistic as buyer activity rebounds. Several factors contribute to this positive outlook:
Key Trends
First-Time Homebuyers: Typically entering the market through condominiums and apartments priced between $450,000 and $750,000, first-time buyers are focusing on affordability as they save for larger down payments on other property types.
Retirees: Downsizing is a priority for retirees, who are opting for condo apartments priced between $1,000,000 and $2,000,000.
New construction projects in Toronto face uncertainty, with many developments being paused unless they’ve already begun. However, the healthy inventory of condominiums offers variety for buyers across price points.
New Construction and Housing Supply
Optimism for Sellers
Reduced Interest Rates: Lower rates make mortgages more affordable.
Regulatory Changes: The announcement of 30-year amortizations eases financial pressure for first-time buyers.
Growing Supply: Increased housing supply provides more options for buyers.
As the market stabilizes, Toronto is poised to navigate 2025 with opportunities for buyers and sellers alike. Whether entering the market, upgrading, or downsizing, a variety of options and favorable conditions are expected to shape the year ahead.