President Trump’s on again/off again tariffs have roiled financial markets and made business decision making very difficult. In spite of all this uncertainty, however, Toronto prices for houses and condos have been very similar to 2024 so far this year.

Houses

Toronto house prices in March are almost identically the same as they were last March. This is despite the fact that the inventory of homes for sale has been much higher than last year. We are in a balanced market, hovering in the 3-4 months’ supply range, as compared with 1-2 months’ supply last year, which was deep in sellers’ market territory. The elevated supply is reducing the number of bidding wars, but prices remain steady. This speaks to the large number of motivated buyers still active in the market, despite many buyers being sidelined due to Trump chaos.

Condos

The condo market is deep in buyers’ market territory, due in large part to the continuing impact of the rapid interest rate hikes in 2022 on condo investors. While rates are gradually coming down, and the condo market will eventually heal, interest rates are still too high for condo rentals to be profitable, and the inventory of condos for sale is very high. Similar to houses, inventory so far this year is much higher than last year, but prices are much closer. After being slightly lower in January and February, prices in March are almost exactly the same as last March.

Bottom Line

Toronto prices for both houses and condos are holding up very well this year despite elevated inventories of both. This resiliency of prices in the face of Trump chaos is very encouraging and suggests that the market could be strong in the second half if we see some resolution of the tariff uncertainties over the next couple of months.

Just over a month ago we were looking forward to a healthy spring market following a surge in sales last October and November. While that still might happen, the tariff war kicked off on Saturday by President Trump has administered a large dose of uncertainty.

Houses

January house prices were virtually identical to last January. While we had hoped for a stronger start to the year, this is actually quite positive. Despite anticipation of the tariffs over the last month, the market is holding up well so far. Sales of houses were also encouraging, as they were slightly higher than both January 2024 and January 2023.

The inventory of houses for sale was about 3.8 months, higher than last January’s inventory of about 2 months. This may be a result of eager sellers hoping to take early advantage of the strong spring market that had been forecast last fall. The fact that prices are steady in spite of the higher inventory is another hopeful sign.

Condo Apartments

The condo market is coming off a volatile 2024. After a strong start, prices leveled off and then fell steeply last summer. Over the last four months, both prices and sales improved as the series of interest rate cuts late last year seemed finally to be gaining some traction. Similar to houses, this suggested that 2025 would be better for condos than 2024.

The uncertainty caused by the Trump tariffs has impacted the condo market just as it has the house market. Sales of condos were lower than last January, and the inventory of condos for sale was higher. Prices, however, were only slightly lower than January 2024 — not the strong start we expected, but yet more positive than it might have been.

Bottom Line

We have entered a period of high uncertainty due to the Trump tariffs. This is completely uncharted territory, however, the Toronto market has so far shown itself to be quite resilient. Stay tuned.

Fall market sales surged more than 20% above 2023 for both houses and condos. This is mostly due to the series of central bank interest rate cuts in the second half. Clearly, buyers are returning to the market in force, and this bodes well for a healthy spring market.

Houses

Prices for houses fell in December, as they typically do during the holiday season. Overall, though, prices during the September-December fall market were about 2% higher than in 2023.

House sales were 25% higher in this year’s fall market than in 2023. Buyers are back off the sidelines and will likely drive the market higher in the spring. Sales did fall in December, but the inventory of houses for sale remained below 3 months’ supply, comfortably in sellers’ market territory.

Condo Apartments

Prices for condos actually increased in December, and were higher than 2023 for the first time since April. This continues the strong uptrend in condo prices since the August low. Clearly condos have turned the corner and are rebounding strongly in response to falling interest rates.  This trend should continue in the spring.

Condo sales improved significantly in this year’s fall market, and were 21% higher than last fall. Similar to houses, condo buyers are back.

Bottom Line

The series of interest rate cuts in the second half of this year are luring house and condo buyers back to the market. Sales for both are up strongly in the fall market. While there is still plenty of uncertainty about the economy and about President Trump’s possible tariffs, it’s likely that the momentum that has started to build in the fall will continue to strengthen in the spring.

The real estate market in Toronto has been on a vertiginous roller coaster ride since the beginning of Covid. High inflation triggered by massive government spending and supply chain disruptions led to steep interest rate increases in 2022. In turn, this caused extreme swings in the real estate market, with price fluctuations of up to +/- 10% from spring to fall over the next two years. This year, both inflation and interest rates have come back down, and the market is finally returning to something resembling a normal seasonal pattern.

Houses

House prices declined slightly in November versus October, but remained well above last year. While we will inevitably see a slowdown during the Christmas/New Years season in December and January, there is every reason to hope for a strong spring market next year. The Bank of Canada will very likely cut interest rates by at least another 0.25% in their December meeting, and that will almost certainly add to the spring momentum.

Sales of houses also remained strong in November, similar to October and well above the summer. This is more evidence of the underlying strength of the market and another harbinger of a strong spring in 2025.

Condo Apartments

While the condo market remains somewhat weak and is still clearly in a buyers’ market, signs of improvement are here also. Prices have recovered from the extreme low in August and have returned to the trend line established in 2023. However, interest rates have not yet fallen far enough to attract a lot of investors back to rental condos. Given that a very large proportion of condos are rental units, it will likely take more time for condos than for houses to return to ‘normal’ as interest rates come down.

Condo sales remain strong in November following a sharp increase in October. This is a strong sign that the condo market is on the mend, albeit slowly. With interest rates becoming less restrictive, and rental condos therefore more profitable, this trend should continue in the coming months.

Bottom Line

The Toronto real estate market has strengthened markedly over the past couple of months, driven mostly by falling interest rates and increased consumer confidence. Condos continue to be the ‘weak sister’ but the condo market is also improving. All signs point toward a healthy spring market in 2025.

Houses

Average house prices increased in Toronto for the third month in a row, and are now back to where they were in June. The 2024 trend line, which has, until now, followed the 2023 trend very closely, has convincingly broken to the upside.

Sales of houses also increased substantially in October, to roughly the same level as in May, this year’s peak month. This corresponds to a big reduction in inventory to under 3 months’ supply, which is back in sellers’ market territory.

Clearly the multiple cuts to the Bank of Canada interest rate are gaining significant traction. Buyers who have been waiting on the sidelines are returning to the market.

Condo Apartments

Prices also improved dramatically for condos. So far, this has only brought condo prices back to where they were last October. Still. this is a welcome improvement after the dismal results in August and September.

Condo sales are also higher in October, similar to houses. Even better, sales are higher than the same month last year for the first time since February. The inventory of condos for sale also fell, though it’s still a bit over 5 months supply. It’s still a buyers’ market for condos.

It would seem that the Bank of Canada interest rate cuts are also bringing condo buyers back to the market. The condo market was hit harder than houses by higher interest rates because of the high proportion of rental units that suddenly became unprofitable and/or unaffordable. It’s very possible that the rebound in condo prices and sales could be even stronger than houses as investors return to the market (and stop selling).

Bottom Line

The Toronto real estate market is showing increasing strength as falling interest rates gain traction with buyers. This trend will likely continue through November and possibly well into December. Following the usual Christmas/New Years slowdown, the spring market could start as early as late January, and the peak price next Spring might even challenge the all-time high that we saw in February of 2022.

Houses

We have seen a slight increase in house prices this month relative to July and August. It’s a smaller improvement than expected, however, based on the three recent interest rate cuts.  The average price is back to where it was this February, and about 2-3% lower than last August. Potentially, this upward trend will continue and even accelerate in October, especially if another rate cut is forthcoming. It seems as if buyers are still cautious about jumping back into the market. As long as prices remain relatively low, they can wait for interest rates to keep falling and therefore improving affordability. That could change once buyers sense that prices are starting to move up more quickly.

The inventory of houses for sale fell slightly in September, consistent with the gradual improvement in prices.

Condo Apartments

The condo market continues to be soft. Prices increased from the August low, but are still about 4% below last September.

Condo inventory continued to rise in September. This suggests that any positive trend in prices and sales this fall might be somewhat muted.

Bottom Line

There are tentative signs that the three recent cuts in the Bank of Canada rate are finally starting to get some traction. It remains to be seen whether the upward trend continues through the rest of the fall.

We remain in the dog days of summer, with low sales and high inventories. Optimism for a robust fall market abounds, as we have already had two bank rate cuts with more likely to come over the next few months. For houses, there is a basis for cautious optimism, but for condos… not so much.

Houses

House prices continue to follow the 2023 script very closely. Unlike last year, prices have ticked up slightly in August where they fell a bit last year. This suggests that the interest rate cuts are finally starting to get some traction. This bodes well for the fall market (starting early September). While fall prices may well be higher than last year, however, it’s unlikely they will get as high as we experienced this spring.

The inventory of houses for sale continued to creep upward in August. This remains a ‘balanced’ market, favouring neither buyers nor sellers. The fact that both prices and inventory inched upward this month is another positive omen for the fall market.

Condo Apartments

Condo prices fell very steeply in August, by more than 9% versus both last month and this time last year. This is huge. Average Toronto condo prices are now below $700,000 for the first time since early 2021. Clearly, interest rate cuts are not (yet) helping the condo market.

The continued very high inventory of condos for sale (over six months’ supply and still increasing) is the immediate cause of the weak condo market.

But, why is the inventory so high? Affordability is improving as interest rates come down, and there is still a shortage of housing, so why isn’t the demand for condos increasing? The most likely culprit is the fact that a very large proportion (about 50%) of Toronto condos are rented. The rise in interest rates since early 2022 has made rental condos an unattractive (and in many cases unaffordable) investment. Many investors, therefore, are dumping their rental condos. Compounding this further is the fact that the landlord tenant dispute resolution system in Toronto is badly broken. It takes many months to get a dispute heard by the tenant board. It’s understandable if buyers shy away from purchasing tenanted condos where they cannot be confident of vacant possession.

In light of all these issues, it seems unlikely that condo prices will recover until interest rates fall much more significantly.

Bottom Line

Interest rate cuts, both in place and forecast, are finally starting to gain some traction with house prices, and we can hope for a reasonably strong fall market for houses. Condos are another matter. The condo market may remain weak for many months to come.

Houses

Just like the last two years, the summer market has arrived with slowing sales and falling prices. In 2022, prices fell by 24% between the spring top and July; in 2023 it was -14%; and this year it is -12%.  These sorts of wild fluctuations have become normal since the beginning of Covid. On average, house prices are little changed since 2020, but there have been swings of +/- 20% above and below this average. It’s especially weird, in light of these wild oscillations, that prices this year have matched last year almost dollar for dollar every month.

The inventory of homes for sale has remained surprisingly low. While sales have fallen by almost 30% over the past two months, active listings have fallen even more, and the inventory is now under 2 months’ supply. This would be a strong sellers’ market were it not for the anemic level of sales. It seems as if buyers have only slightly more interest in buying than sellers have in selling.

Condos

Similar to houses, condo prices are continuing to follow the 2023 trend. July prices are down about 3% from the spring peak and slightly below last July. The 0.25% drop in the bank rate in June has so far had no discernable effect on prices. Last year there was no ‘fall bounce’ in prices – they just kept dropping steadily until they returned at the end of the year to where they started in January.

The inventory of condos for sale has risen steeply over the past two months. Early this year it was under 4 months’ supply; it was basically a balanced market. Now, however, we are above 7 months’ supply, deep in buyers’ market territory. This is due to a combination of falling sales and rising listings. The elevated inventory level will be a strong headwind against any bounce in condo prices this fall.

Bottom Line

We have now had two successive .25% reductions in the bank rate, and there’s a good chance of two more before the end of the year. Hopefully this will encourage more buyers to come off the sidelines and give us a healthy fall market. As interest rates fall, however, recession fears seem to be rising. Let’s hope the Bank of Canada hasn’t waited to long to bring interest rates down.

Houses

Following the normal pattern, the spring market peaked in May and is slowing down as we head into summer. Prices so far in June are slightly lower than last June, and are still following the 2023 trend line very closely.

Last summer, prices fell steeply during the summer and bounced back only weakly in the fall, mostly because of dashed hopes for interest rate cuts. This year, we have already had our first rate reduction and, while it was only 0.25%, there is a lot of optimism that we will have more cuts this year. This could limit the fall in prices over the summer and may even give us a very nice bounce in the fall.

Consistent with the current softening in prices, the inventory of houses for sale is moving higher. We are now in a “balanced” market, favouring neither buyers nor sellers. Inventory may drift a bit higher over the summer, but we will probably avoid an outright buyers’ market as long as rates keep coming down.

Condo Apartments

Condo prices are also falling this month. Unlike houses, condo prices peaked in April and have been falling slowly ever since. Last year, condo prices fell steadily over the second half, without any bounce at all in the fall. By the end of the year, prices were right back where they started in January.

There were two reasons for this: first, high interest rates are a bigger affordability factor for condos than for houses; and, second, many owners of rental condos have been dumping these condos because of higher mortgage payments on both their houses and their rental condos. Falling interest rates may keep condo prices from falling as steeply as they did last year.

Over the past three months, condo inventory has been climbing and is now higher than at any point last year. We are deep in buyers’ market territory and this suggests that the condo market may be weaker than the house market for the rest of this year.

Bottom Line

The recent 0.25% cut in the Bank Rate is good news for both houses and condos. Without further cuts, however, the impact on prices is likely to be minimal.

Average prices in May are again higher than last month, but are lower than last May. We have likely reached the peak for the spring market.

Houses

House prices in May are about 1% higher than April and about 4% below last May. Spring prices typically top out in May and so we’ll probably see flat to lower prices over the next month as we head into the seasonally slower summer months.

Last year, prices fell rather steeply after May, mainly due to increases in mortgage interest rates when decreases were widely expected. The story is more positive this year. While the central bank has not yet reduced rates, the odds favour this happening over the next few months. If so, a strong fall rebound could be in the cards.

The inventory of houses for sale is somewhat higher in May, but below last May. This supports the thesis that we will see more of a leveling off of prices as we head into the summer rather than the steep drop that we saw last year.

Condo Apartments

Prices for condo apartments also seem to be leveling off as we come to the end of the spring market. As for houses, the price trend for condos over the past 5 months has closely matched last year. The prospects for lower interest rates sometime in the next few months should moderate any fall in prices over the summer. We might even see a fall rebound in condo prices, something that was completely absent last year.

Condo inventory remains elevated at just under 4 months’ supply. This is by no means a sellers’ market, but neither is it a buyers’ market. In combination with the projected interest rate cuts, this balance will hopefully buffer any fall in prices over the summer.

Bottom Line

Much depends on the outlook for interest rates. Last year there was much wishing & hoping early in the year, and this powered a strong spring market. When these hopes were cruelly dashed, prices fell steeply over the second half. This year, the spring market has been equally strong and, should the expected interest rate reductions (however modest) materialize, prices should be lest volatile during the second half of 2024.

Houses

Prices in April are up about 5% over last month and are once again almost identical to the same month last year. Prices have risen by about 15% since January and, if we continue to match last year’s trend, they will be up another 7% or so next month. This sort of wild volatility has been going on for the last 5 years, since the lockdowns began, and shows no signs of changing any time soon.

That said, we can make some tentative predictions about the short term direction of the Toronto market. Prices are likely to level off and begin to fall over the next couple of months for two reasons:

1. The summer months almost always bring a slower market and falling prices because so many buyers and sellers put their real estate plans on temporary hold in order to better enjoy our limited summer weather; and
2. The rising prices this spring were driven in large part by hopes for falling interest rates. Inflation has become stubbornly persistent, and this is pushing expectations for interest rate reductions further and further in the future. This will probably curb buyers’ enthusiasm, much as it did last year.

It seems unlikely that prices will fall as far and as steeply as they did in the second half of last year, as the interest rate outlook is better than in 2023. Also, buyers are beginning to realize that rates are not going back to where they were pre-2022 any time soon, if ever. After all, 5% mortgages were the norm 10 years ago and may become so again.

Sales of houses have increased this month, but listings have increased more, so inventory is rising. We are still deep in sellers’ market territory at under 2 months’ supply, however, higher inventory is often a harbinger of a slowing market. So this is another hint that we are nearing the end of this hot spring market.

Condo Apartments

Condo prices are also continuing to rise. April prices are about 5% higher than March, and are up about 8% since January. The short term direction of the condo market will likely mirror that of houses, with prices leveling off and then declining over the next few months. As for houses, we should expect the decline will be milder this year than in 2023.

As for houses, the inventory of condos for sale is rising modestly after falling for the past three months. The condo market was already balanced between buyers and sellers and so, once again, a cooling trend is probably not far away.

Bottom Line

This year has so far been eerily similar to last year, with price levels almost exactly matching 2023. The outlook for interest rates is more positive than last year, and so any softening in the second half will hopefully be less extreme than in 2023. The market remains extremely volatile, however. To paraphrase Yogi Berra, prediction is very difficult, especially about the future.

Prices for all property types are again almost exactly the same this month as they were in the same month last year. The ‘hoping for lower interest rates’ meme is continuing to drive the market, as prices are continuing to rise. While the odds of interest rate cuts seem a lot higher than they were last year, they are not yet a lock. Persistent inflation and/or persistent economic strength could once again delay any cuts. On the other hand, should lower rates arrive as expected, we could see a very strong market throughout this year.

Houses

So far in March, house prices are within a rounding error of matching last March. Also, while the rate of price increase has slowed a bit this much, we haven’t seen an actual March-Break-induced drop in prices like we did last year. This sets the stage for even higher prices in April and May, perhaps accelerating after Easter weekend at the end of March.

The inventory of houses for sale ticked up slightly in March, though it remained deep in sellers’ market territory at less than 2 months’ supply. House sales in March are almost exactly the same as last March, but listings are somewhat higher. We we probably see even more listings in April and May, however, we’ll probably see a lot more buyers also as long as the interest rate outlook stays positive. The low inventory has led to the resurgence of bidding wars, with extreme underpricing once again becoming common (if not the norm).

Condos

Prices for condo apartments continue to follow last year’s increasing trend line very closely. As for houses, the prospect of lower interest rates is the main driving force for higher prices.

The inventory of condos for sale has come down from last fall but remains high. Delayed offers and bidding wars are rare, consistent with a balanced market. Even more than houses, the condo market is being driven by interest rate optimism, and is quite vulnerable to any change in interest rate sentiment.

Bottom Line

The Toronto market is continuing to improve in March and is closely following the 2023 trend line. As long as hopes for lower interest rates remain high, this pattern will likely continue for at least the next couple of months. Almost certainly there will be a summer slowdown from mid June until mid August. The strength of the fall market will depend on whether interest rates actually come down.