Prices Continue To Fall, Anxious Seller's, Patient Buyer's. Opportunity On The Horizon.

If you’ve been wondering where today’s buyers have gone, you’re not alone. After a frenetic market that saw bidding wars and skyrocketing prices for years, many buyers have stepped to the sidelines – some by choice, other's dealing with affordability pressures, uncertainty around the economy, and simply a lack of compelling options.

In May 2025, GTA home sales ticked down to 6,244 units, marking a 13.3% decline compared to May 2024 (6,244 vs. 7,206) as reported by TRREB’s MLS® System.

Broadly speaking, the average selling price across all home types in May came in at $1,120,879, down 4% from $1,167,646 in May 2024. This year’s spring frenzy has cooled into something more akin to a gentle breeze.

INVENTORY

There’s no shortage of choice for buyers. May saw a 14% increase in new listings year-over-year, with 21,819 properties hitting the market. That’s a big jump, up 14% compared to 19,147 in May 2024.

Active listings climbed even more dramatically—up 42% compared to last May. That means more unsold homes sitting on the market longer. The average time to sell? 27 days on market. But talk to any agent and you’ll hear stories of 30, 60, even 90 days and counting.

That being said it is Important to understand that a large portion of duplexes, triplex’s or homes in need of upgrades seem to be the ones taking the longest to sell or not selling at all. Why? Capital is hard to come by or expensive so most buyers do not want to renovate right now and investors who usually look to buy multi -units are more interested in selling.

What’s Driving the Surge?

Confidence—or lack of it. Borrowing costs are still high. And even though there’s chatter about rate cuts, buyers aren’t rushing in just yet.

Shift in Buyer Mindset: With mortgage rates still elevated compared to pre-pandemic lows, prospective buyers aren’t as eager to roll the dice on a hot listing. They’re willing to wait for more options or better pricing rather than chase the next bidding war.

Condo vs. Freehold Dynamics: The condo segment has especially piled up extra supply. We currently have 7.5 Months of Inventory for Condos. Freeholds have close to 4.5 Months of inventory. Meaning at the current rate of sales we would need nearly 5 Months to sell all Freeholds and nearly 8 Months to sell all condos. In the Spring of 2022 we were selling all home types within 1-2 months.

WHAT'S GOING ON WITH PRICES?


Prices are dropping, but slowly. While headlines talk about affordability “improving,” what that really means is prices are dropping faster than interest rates.

Detached Homes: In May 2025, the average price for a detached home sat at $1,425,264, down 5.4 percent compared to May 2024.

Semi-Detached: Semi-detached homes averaged $1,098,447 in May 2025, down 6.4 percent from a year earlier.

Townhouses: Townhouse prices moderated to $904,272, down 4.5 percent from May 2024

Condo Apartments: Average condo-apartment prices dipped to $683,413, a 6.4 percent decline compared to May 2024’s $715,000.

Yet some segments—especially entry-level homes—are holding steadier. And while average prices have declined, the MLS® Home Price Index Composite (which adjusts for types of homes sold) shows a 4.5% drop year-over-year.

That’s three straight months of downward pressure on average selling prices. In effect, buyers who watched values climb unsustainably over the past few years can now, for the first time in over a decade, consider that “negotiation” actually means having leverage.

WHAT SELLER'S NEED TO KNOW

Lack of Economic Confidence: Consumer confidence in Canada took a hit in April 2025, owing to ongoing trade tensions with the U.S. and questions about where interest rates will settle later this year.

Equity Concerns: Buyers who purchased at the 2021-2022 peak often have minimal equity cushions. As a result, they’re wary of selling now unless they can be certain their next purchase will appreciate—another factor keeping them on the sidelines.

If you’re planning to sell this summer, here’s the blunt truth: price below what you think your home is worth. Why? Because it’s one of the few ways left to generate urgency. List too high and you’ll sit. Price it right—or slightly low—and you might still get interest, or even a decent offer.

Let’s be honest: buyers today aren’t feeling FOMO. There’s no frenzy. There’s no lineups. There’s no “offer night with six bids” kind of magic. That script has changed. And if you do get an offer—consider taking it. Holding out for last year’s price could mean watching your place linger into fall… or beyond.

WHAT BUYER'S NEED TO KNOW

For the first time since 2010, buyers can once again negotiate deals that weren’t possible during the 2021-2022 frenzy. Consider these practical takeaways:

Bidding Wars Are Rare: In May 2025, fewer than 15 percent of GTA listings received multiple offers—a stark contrast to the 60 – 70 percent we saw in late 2021.

Price Reductions Are Common: It seems close to half of active listings in May underwent at least one price reduction. If you’re touring homes, ask your agent to see the “price history”—a sign that the seller may be more negotiable.

Longer Negotiation Windows: Whereas a summer 2022 listing might have sold in 7 days or less, today’s homes often linger for 3 – 6 weeks. Buyers can schedule multiple showings, secure a home inspection, and consult advisors without feeling rushed.

Buyers with strong financing or all-cash are especially well positioned. A seller who previously fielded eight offers at full ask might now receive a single conditional offer at 95 percent of list price. That difference—$25k – $50k in the cheque—represents genuine opportunity.

LOOKING AHEAD

Why This Summer Might Be the Sweet Spot of 2025 for buyers. After months of correction and cooling, we’re approaching a unique window where:

Buyer Choice Peaks: Inventory is at its highest seasonal level, every year without a doubt July and especially August are two of the slower months for GTA Real Estate activity, kids get out of school, many buyers head for vacations and the market slows to crawl come early August. As an example July 2024 saw 5,498 total home sales and August 2024 saw just 5,094 sales. With 2025 sales numbers continuing to trend downward I suspect we could see less than 5000 sales in each of these upcoming months, which historically speaking is very low as we usually average closer to 6000+ sales when looking at the last decade.

Over the years I’ve had many buyers purchase within these months without bidding wars and usually a sense of desperation from sellers as many see and understand how slow things are come peak summer.

So my advice to any active or about to be active buyers is to focus in on the next 10 weeks, be active in the market looking at homes, going to open houses and you may just find a great home in a sought after neighbourhood at a much more reduced purchase price than you could have imagined.

Seller Motivation Rises: Those who listed early spring and didn’t sell are now more realistic about pricing. Many will drop their price a final time in June/July to avoid the August market.

Mortgage Rate Clarity (Expected): Analysts anticipate one or two Bank of Canada rate cuts before year-end. As soon as buyers sense the direction of rates, continue to see the headlines of prices coming down and listings up they’ll re-enter the market in search of a deal.

Summer 2025 may represent one of the few times in the past 15 years where a buyer truly has the upper hand. Properties have fewer competing offers, days on market hover near two – three weeks, and motivated sellers—especially those carrying second mortgages—are willing to negotiate freebies (credit for closing costs, extended closing, covering HV/AC tune-ups, etc.). I suspect some buyers who are uniquely positioned will look to jump in and get a deal, others will wait to try to time the bottom.

As always feel free to send me your feedback or questions.

Who the heck is buying in todays market?

Toronto Real Estate Newsletter – April 2025

As we wrap up the first quarter of 2025, it's clear that the Toronto real estate market is still struggling to gain its footing. While prices have remained relatively flat, the story for March is more about what isn’t happening than what is. Simply put, buyer confidence remains low, and it’s showing in the numbers.

March 2025 Market Snapshot

According to the latest TRREB data, GTA REALTORS® reported just 5,011 home sales in March 2025, a sharp 23.1% decline compared to March 2024. In fact, this marks the lowest March sales figure in the past 30 years—a stunning statistic that underscores the uncertainty many buyers are feeling in today’s market.

And yet, new listings are surging. March saw 17,263 new listings, up 28.6% year-over-year. Inventory is building across both the condo and freehold sectors, giving buyers a growing number of options and reinforcing the shift away from a competitive seller’s market.

On a seasonally adjusted basis, sales were down month-over-month compared to February 2025, showing that any early-year momentum may have already started to fade.

What’s Happening on the Ground

It’s becoming increasingly clear that many buyers are in wait-and-see mode. Concerns around high borrowing costs, economic uncertainty, and affordability continue to weigh on consumer sentiment. So who’s actually buying right now? I’m finding those in a strong financial position are active, perhaps they have no property to sell or a low to no mortgage at all. Many are looking to find value by upsizing to a family home and are the ones actively searching, others are first time home buyers wanting to use this slowdown to get into a neighbourhood and home that in past years seemed impossible — this is especially happening in neighbourhoods with strong fundamentals such as well rated schools, transit, parks, walkability, as these neighbourhoods usually have very low inventory and plenty of competition. These buyers are interested in turnkey, ready to go, homes. With inventory higher than past years the opportunities are there more so than we have seen in years before to enter these sought after neighbourhoods. 

Still the bulk of prospective buyers are cautious and playing wait and see, but make no mistake I’m seeing interest from buyers, conversations are happening, inquiries are there just at a more casual pace, watching, evaluating and thus not many actually converting to transactions because of the uncertainty, which makes sense. 

Freeholds are definitely moving faster than Condos. Smaller condos, Triplex homes and commercial properties are the most sluggish part of the market as those are always investor driven and most investors are currently hibernating. For those who can afford to take on some calculated risk they are seeing the opportunities and understanding the negotiating power they have in todays market and on the look out for deals.    

At the same time, sellers are entering the market in greater numbers. Whether motivated by changing life circumstances, financial needs, or a belief that the market may worsen before it improves, we’re seeing more listings hit the market than we have in years.

Condo and Freehold: Inventory Keeps Climbing

In both the condo and freehold segments, we’re seeing inventory swell. Condos, in particular, remain a buyer-friendly market with high supply and limited urgency from buyers. Meanwhile, freeholds—especially detached homes—are still seeing demand, but it's tempered and heavily price-sensitive.

Sellers in all segments should note: homes that are priced accurately and show well will still attract attention. But the margin for error is slim. Overpriced properties are sitting, and buyers are not in the mood to chase.

Looking Forward: What to Watch This Spring

We’re entering the busiest season of the real estate year—the spring market—but this year feels different. Buyer activity has been slow to materialize, instead they are watching and unless something changes—such as a significant mortgage rate drop or a shift in economic sentiment—we may be headed for a slower-than-usual spring.

This doesn’t mean the market is dead (but it is very slow)—it’s evolving. For buyers, it’s a chance to shop with less pressure and more options. For sellers, it’s more important than ever to have a clear strategy, strong marketing, and a realistic price.

Final Thoughts

The first three months of 2025 has reminded us that confidence plays a huge role in the housing market. Even with more homes for sale and prices relatively flat, many are choosing to wait. What happens next is anyones guess, but could a usual seasonal slow down that happens every June-August finally bring prices down as inventory sits? Will buyers flinch and jump in as they see more options and perhaps lower rates and a new election calm things come summer? As I've perviously stated in my past newsletters I do not see Condo’s improving anytime soon, inventory will stay high, and prices will trend downwards for the rest of the year. Freeholds? Well if things calm down with all the tariff talks and rates drop further I suspect we could see a stronger than usual fall market for those.

If you're looking to buy or sell, knowledge is power. Let’s talk strategy so you can make the most informed decisions possible in today’s market.

As always, if you have any questions or want to know what’s happening in your neighbourhood specifically, or just understand the value of your home in todays market, don’t hesitate to reach out!

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How to Avoid Overpaying for Your Next Home

August 12th 2021

Every time I meet with a new buyer lately one of the main concerns I hear (understandably) is how to avoid overpaying for their next home.

I thought it would be helpful to breakdown a solution to help avoid this problem.

Before you bid on your next home your realtor should create a detailed Comparative Market Analysis (CMA). The goal of a CMA is to understand the homes true value before you decide to buy it, this is especially important when homes are priced low on purpose to create a multiple offer situation. List price in the GTA is just that, a list price -- it doesn't always reflect true value.

Street location is a very important consideration: Is the property beside a commercial building? Is it on a quiet residential crescent? Does it call a busy main or through street home? All of these factors affect value to some extent.

Finally, being able to read the market temperature at the moment of purchase for a particular neighbourhood is also important when it comes to making sure the home you buy is worth what you pay for it and not less.

This is incredibly relevant when it comes to financing, as it's possible that if an appraiser discovers a home is not worth what a buyer paid for it they may only provide a loan up to the appraised value. Meaning, if you pay $1,100,000 for a home and an appraiser values the home at 1,050,000, you're on the hook to come up with the other $50,000 to close.

As you can probably see, this reality can become problematic in a market where multiple offers on homes are the norm and homes are consistently underpriced by sellers/realtors to create said multiple offers in an effort to achieve sky-high sales price.

So, how do you avoid overpaying on a home that’s priced under market value and that you will most likely be in a bidding war to win?

Answer : A very good CMA.

Most CMA’s take between 45 and 90 min to put together depending on home, area, and available comps. Condos are a bit easier to prepare a CMA for while freehold homes take longer because the differences between individual homes are usually greater than those found when comparing 800 sq ft two bedroom condos in the same building.

The repetition of this excersize takes patience, a must for understanding of a neighbourhood and home type. Also understanding different price points ($500K vs $4M for example) can be tricky. And, again, having an accurate read of the current market temperature in a particular neighbourhood is vital.

There are a few different ways to put together a CMA -- and details do matter. It shouldn’t just be looking up the last sale close by. Researching at least two to four similar homes is always best practice.

I like to break down each comparable home by the following attributes, much like a appraiser for a bank does:

Home Location/Neighbourhood

If it's a Condo, look at similar sold units in the same building or sister building by the same builder. Sometimes different buildings are not great comparables as the building's maintenance fees, amenities, age, and reserve fund may all be different and thus affect value. For freeholds, school catchment can sometimes play a role as well.

Type of Home

Is it a condo, a townhome, a detached house? Is it a bungalow or a two-story home? Lot size is also important on freeholds (particularly the width of the lot). For condos, square feet, view(s), layout and floor location (think: a corner unit/penthouse vs rest of building), and room sizes are all important factors in evaluation.

Parking and Outdoor Space

Does the property come with parking? Is a driveway private or shared? Is there a garage, and if so, is it built in or detached, double or single? What are the sizes of both the back and front yards, what's the quality of landscaping, is there a pool?

Updates

How updated the home is and what its overall condition is are very important considerations. I've seen homes with renovations that are so poorly done many of the items need to be addressed again. Compare this to a home that has been lived in for 35 years but is in impeccable condition? To me that’s nearly a wash. If a condo, the age of mechanics such as the roof, the HVAC system, electrical, plumbing, and the condition of the windows all play a role in evaluation. These last items are ones I find not enough buyers pay attention to.

Next is finding the most recent comparable home sales nearby and noting the difference in each by + or – dollars.

Example: A new roof on a average home is $7K, and new windows on a bungalow approximately $20k. Laneway access homes in Riverdale usually sell more than a comparable home with no laneway. The point is, none of this is an exact science.

A home may seem to be worth $1.1M based on recent sales and all the attributes mentioned.But we also have to take into consideration the market in that particular neighbourhood -- is it speeding up or slowing down? We need to better understand on a micro level how competitive, or perhaps uncompetitive, the area is on offer day.

This is where all the aforementioned legwork, experience, and data plays a role. Your agent should be finding out how many offers the last few nearby properties that sold received. Are showings on other nearby listings up or down? If a recent sale received nine offers, that could mean eight other buyers lost out and might still be looking to buy a similar home in the neighbourhood. At least some of these buyers may offer on the next available property, which means it's highly possible that if the home you are offering on gets six offers (including yours) it may very well sell for above its CMA value.

This does not mean you should pay that higher price for the home, but it does mean you should prepare yourself mentally and emotionally for what's to come.

As a buyer in a competitive market it helps you rationalize and weigh the pros, cons, and risks of deciding to pay more for a property (or deciding not to) and how best to proceed. Maybe it is worth it to you to pay more than a home's current value because it has certain aspects that you, as an individual buyer, value above others.

For example, I once had a couple who wanted to buy a home on the same street as their parents. The market was super competitive, but they were comfortable paying a premium (+2-3% above the home's actual value) because they could afford it. They also had the funds available to cover any appraisal shortfall and time was more important to them than waiting another 6-12 months for another house on the street to come up.

Others will be patient and wait it out, and that’s okay too. Home buying isn't always a quick process, it takes time to find the perfect property for every buyer. Once a buyer learns to focus on controlling only what they can, their stress levels will go down. If someone else pays 10% above value on a home, so be it -- at least you didn't overpay.

The most important takeaway is that using data, experience, and a discernible eye to understand a home's true value will go a long way in ensuring you don't overpay -- hot market or not.

Questions? Set Up A No Obligation Phone Call With Gus