2025 Housing Market Trends Analysis: Declining Sales, Price Pressures, and Future Market Outlook

According to the real estate report released by the Toronto Regional Real Estate Board (TRREB) on February 5, 2025, a total of 3,847 homes were sold through TRREB’s MLS® system in January 2025, representing a 7.9% decline compared to the same period last year. The MLS® Home Price Index Composite Benchmark rose by 0.44% year-over-year in January 2025. The average selling price reached CAD 1,040,994, marking a 1.5% increase compared to January 2024.

Sales Decline, Market Remains Sluggish

Data shows that home sales in the Greater Toronto Area (GTA) reached 3,847 units in January 2025, a 7.9% decrease compared to 4,177 units in January 2024. This indicates that market demand remains weak. If this trend continues, total sales for 2025 could fall below the 67,574 units recorded in 2024, setting a new low since 2001.

However, TRREB remains optimistic about 2025, forecasting total home sales to reach 76,000 units—a 12.4% increase from 2024. Lower borrowing costs combined with ample supply are expected to improve affordability and encourage more buyers to enter the market.

Surge in Listings, Worsening Supply-Demand Imbalance

In contrast to declining sales, market supply has surged significantly. In January 2025, new listings reached 12,392 units, marking a 48.6% increase from 8,337 units in January 2024. Meanwhile, active listings in January 2025 rose to 17,157 units, a sharp 70.2% increase from 10,083 units in the previous year.

This substantial rise in supply, without a corresponding increase in buyer demand, has led to rapid inventory accumulation. As competition among sellers intensifies, their bargaining power weakens. Homeowners eager to sell may face increasing price pressures in the coming months, particularly in the condo market.

Modest Price Increase, but Condo Market Under Pressure

Despite declining sales, home prices have continued to see modest growth. In January 2025, the average home price in the Greater Toronto Area (GTA) stood at $1,040,994, marking a 1.5% increase from $1,025,226 in January 2024.

Looking at different property types, low-density housing remains in high demand, while the condo market is under pressure.

• Detached Homes: Sales +3.8%, Average Price +1.8% – Stable performance

  
  

• Semi-Detached Homes: Sales +15.7%, Average Price +2.1% – Strong demand

  
  

• Townhouses: Sales +15.7%, Average Price +1.6% – Affordability attracts buyers

  
  

• Condos: Sales -14.5%, Average Price -1.6% – Market under pressure, evident price declines

TRREB forecasts that home prices will reach $1,147,000 in 2025, reflecting a 2.6% increase from 2024. Buyers are showing a clear preference for low-density housing (detached homes and townhouses) over condos, which continue to face oversupply and pricing pressure.

Overall Outlook: 2025 GTA Housing Market to Remain Divided

The Greater Toronto Area (GTA) housing market in 2025 is expected to remain highly segmented. Low-density housing—including detached homes, townhouses, and semi-detached properties—is likely to see steady demand and price stability. In contrast, the condo market faces mounting pressure, with potential further price declines due to rising inventory and weaker buyer interest.

Key Takeaways for Buyers and Sellers

• For Sellers: Pricing strategies and adjusting market expectations will be crucial in 2025. Low-density homeowners may still have negotiating power, while condo owners might need to be more flexible on pricing.

• For Buyers: With increased supply and moderate price growth, 2025 could offer good buying opportunities, especially in the condo market where discounts may become more prevalent.