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Toronto’s real estate market kicked off 2025 with a mix of momentum and hesitation. January saw home sales dip slightly to 3,847, marking a 7.9% decline from last year. However, prices continued their steady climb, with the average selling price reaching $1,040,994—an increase of 1.5% year-over-year. Overall, home sales increased by 14.5% month-over-month, rising from 3,359 to 3,847.
Higher borrowing costs continue to shape buyer behavior, but a surge in new listings (up 48.6% from the previous year) suggests more sellers are testing the waters. This growing inventory could set the stage for a more dynamic spring market.
Detached Homes Lead, But Buyers Seek Alternatives
Detached homes remained the most sought-after property type, making up 41.1% of all sales with 1,580 transactions at an average price of $1,377,430. The price gap between Toronto proper and the surrounding 905 region remains significant. In the city, detached homes average $1,579,386 and in the 905, they come in lower at $1,319,751.
Affordability concerns are steering buyers toward more budget-friendly options, particularly semi-detached homes. In Toronto, sales of semi-detached homes jumped 25.7% year-over-year, with an average price of $1,154,505. This signals that many buyers still want the space and independence of low-rise housing without the hefty detached home price tag.
A major policy shift is also shaping the market. With the recent increase in the insured mortgage price cap from $1 million to $1.5 million, more homebuyers now qualify for mortgage insurance on higher-value properties. This change introduces tiered down payments, allowing buyers to put down 5% on the first $500,000 and 10% on the portion between $500,000 and $1.5 million, making homeownership more accessible.
Townhouses saw 725 sales at an average price of $904,986, reflecting a year-over-year dip, particularly in the 905 region. Condo apartments remained the most affordable entry point, with 1,161 units sold at an average price of $670,675. Demand grew since December, with sales increasing by 20.9% month-over-month, from 960 to 1,161.
However, the condo segment saw the sharpest year-over-year decline in sales—down 12.1% overall, with a 14.5% drop in Toronto proper. With supply outpacing demand, condo buyers are in a strong position to negotiate better deals.
Regional Highlights: Peel Leads the 905, Central Toronto Holds Strong
The central district led sales in Toronto with 645 transactions, followed by Toronto West with 378 sales and Toronto East with 363.
Beyond Toronto, Peel Region was the hottest 905 market, recording 749 sales. Strong commuter access and a diverse housing stock continue to make Peel a top choice. York Region followed with 620 sales, appealing to buyers looking for larger suburban homes, while Durham’s affordability kept it competitive with 489 sales.
Interest in areas outside the GTA also remained steady. Simcoe County saw 127 sales, while Dufferin County recorded 36, highlighting continued demand beyond the city limits.
Oakville led the surge in new listings, soaring 427% from December, while sales climbed 18%, signaling strong seller activity. Milton followed with a 242.5% month-over-month jump in new listings and a 41% increase in sales. Burlington saw a 202% rise in new listings, paired with a 25% boost in sales. Halton Hills saw new listings increase by 170%, with sales up 68%, reflecting strong buyer demand. Mississauga’s new listings rose 159%, with sales up 20%, while Brampton’s market saw a 125% uptick in new listings and a 32% increase in sales.
On a city level, Brampton led Peel with 355 sales, averaging $985,321. Meanwhile, Markham had 173 sales in the York Region at an average of $1,219,844. In the Halton region, Burlington and Oakville saw 139 and 138 sales, respectively, averaging $1,161,250 for the area. Oshawa recorded 158 sales for the Durham region, with homes selling for $779,868 on average. Simcoe County’s Innisfil had 38 sales at $908,355, while Orangeville saw 36 sales averaging $909,772.
Expert Insights: What’s Ahead for 2025
Despite the dip in sales, TRREB remains optimistic, projecting 76,000 home sales this year—a 12.4% increase from 2024—driven by lower borrowing costs. The average selling price is expected to reach $1,147,000, marking a 2.6% increase, with detached homes likely seeing the most substantial price growth.
Housing diversity remains a key focus. TRREB President Elechia Barry-Sproule highlighted the need for more “missing middle” housing, including townhomes, duplexes, and low-rise multi-unit buildings, to create more attainable options.
However, affordability challenges persist. “Traffic congestion and affordability are interconnected challenges that require integrated approaches,” said TRREB CEO John DiMichele. “The current system of high development charges, taxes, and administrative hurdles only exacerbates the issue.”
With an influx of new listings and evolving buyer trends, 2025 will be a pivotal year. Whether buying, selling, or investing, staying ahead of these shifting dynamics will be key in navigating Toronto’s ever-changing market.
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