What To Make Of 2025
Safe to say that our predictions that 2025 would be the recovery year for freehold housing did not occur. Condos continued to slip in value, which we suspected. What was completely beyond our scope was the effect of the inauguration and subsequent tariff hikes and threats that ensued. This squashed the market confidence, but for the month of May.
As the year progressed, we began to project that sales may hit a low not seen since the mid-90s. Now that we are within reach of the 2025 year-end, we can safely state we will land at roughly 62,500 sales on TRREB. This is slightly less than we saw in 1996. Keep in mind that the city’s population was half what it is today, and there were very few condo buildings and the tens of thousands of units within. Our historical sales average is 85,000. Our ten-year rolling average was just over 90,000. Our high-water mark was during the pandemic at 122,000. This gives a clear sense that 2025 was a challenging year for most sellers and a good year for those buyers with the courage to acquire.
We suspect that 2026 will mark the “bottom of the value market” for freehold housing. Condos could have a little longer wait. The crystal ball projected recovery is the Fall of 2026. We have a dark-horse hope that condo sales begin to pick up, as affordability levels are quite attractive, especially given that mortgage rates have come down substantially over the last year and a half.
While we don’t expect a banner year in 2026, the early stages of a recovery are likely ahead. Do we see 72,000 sales? Possibly, while this is still below historic levels, it is a significant improvement from 2025.
Other Points Of Interest
- 1/3 of transactions in TRREB were sales, the remaining 2/3 were leases. This is the opposite of a strong sales year – in 2021 it was 2’3 sales, 1/3 leases. Why? Sellers weren’t getting the prices that they wanted (read: 2021/2022 peak value). Mortgages were harder to afford, and landlords gave up on selling and turned to the rental pool.
- 1 in 3 properties on MLS will sell. That’s it. This is a poor absorption rate. Priced wrong, and the listing won’t sell. Full stop.
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Looking for more insights into Toronto real estate? Check out these related posts from my blog!
- Where to Buy A Toronto Condo If You Don’t Want To Live Downtown
- What Are Must-Make Repairs Before You Sell Your Toronto Home?
- Is Rosedale A Family Neighbourhood?
We Are Keeping A Close Eye On 50,000 Condo Unit Completions In 2026
What is the effect of 50,000 unit completions in 2026?
Does this flood the “generic” condo market in the core?
20,000 of the 50,000 are either not sold or in default with the pre-sale buyer. How many more defaults will happen due to mortgage affordability?
Can the buyers afford their mortgage payments now that rates are much higher than when they purchased pre-construction 3-6 years ago?
How many units will go into the already saturated condo resale pool?
How many units will go into rental pools? Can the landlords afford the mortgage debt service? We suspect the rents will fall well short of the mortgage payments and other expenses for many landlords.
How much could the above effects elongate the condo price recovery?
Toronto Vacant Home Tax Declaration
Toronto’s Vacant Home Tax Declarations are due here. The city now allows calls to 311, and a drop-by desk at City Hall is available if you prefer an alternative to the website.
Happy Holidays & Happy New Year
We want to take a moment to wish you all the happiest holidays and a healthy, happy, and prosperous new year! This is a wonderful time of year to reflect on what we are most grateful for and to spend time with family and friends.
It has been a year of deepening relationships, as we had more time to discuss life, and each purchase and sale was more involved. We are so grateful for the time and trust that our clients have given us as we met their objectives in 2025.
Have questions about buying or selling in today’s market? I have answers! Reach me by email at ryan@ryanroberts.ca or call 416-925-9191.
