There were no surprises in the residential resale market data provided by the Toronto Regional Real Estate Board for the month of November. As forecast in previous Market Reports, home sales and average sale prices on a year-over-year basis continued to decline. Condominium apartment sales, both in the City of Toronto and the 905 Region, posted substantial declines compared to the same month last year.
Last November 5,947 properties were reported sold. This year that number came in at 5,010, a decline of more than 15 percent. Similarly, the average sale price for all homes sold, including condominium apartments, also declined. Last year’s sales produced an average sale price of $1,110,415. This November the average sale price came in at $1,039,458, a decline of over 6 percent.
Throughout 2025 sales and average sale prices have been declining. This pattern began and ingrained itself in January, almost simultaneous with the installation of the new Republican administration in the United States. The implementation of the administration’s punishing and at times chaotic tariff policy created a level of uncertainty the economy has not experienced since the early stages of the Covid-19 crisis. That uncertainty has permeated the residential resale market. Buyers are reluctant to engage in expensive ventures when there is economic, job, and cost of living uncertainty.
In addition to the prevailing economic uncertainty, affordability continues to prevent buyers from entering into the market. Notwithstanding declines in average sale price, Toronto and Region home prices, excluding condominium apartments, remain lofty. In November the average sale price for detached properties in the City of Toronto came in at $1,549,941. Semi-detached properties were not far behind at $1,187,111. The Bank of Canada has reduced its overnight lending rate to 2.25 percent in 2025, unfortunately these reductions have not substantially impacted mortgage borrowing costs. Five year fixed term mortgage rates remain over 4 percent, primarily as a result of lofty bond prices. Variable rates are lower, but not sufficiently lower to bridge the affordability gap. There are buyers eager to buy, but they are cautiously watching prices and borrowing costs.
Condominium apartment sales and prices, like ground level properties, are declining but influenced by other factors in addition to affordability and economic uncertainty. Given that in November the average sale price for condominium apartments in the City of Toronto came in at $701,000 and only $583,000 in the 905 Region, the almost 22 percent decline in sales for condominium apartments, at first blush, appears incomprehensible.
If affordability is a deterrent to sales, then the price of condominium apartments should act like a magnet for buyers. Condominium apartment sales, and to a lesser degree, prices are declining due to design. The preponderance of condominium apartment inventory was designed for investors and not for end-users, certainly not for family end-users. Most available units are less than 700 square feet, in some cases as small as 350 square feet. Investors who bought these units on the basis that they would be suitable for profitable rentals are now off-loading their units in the face of declining immigration and rental rates. The structural problems that underline and undermine the condominium apartment market will take a number of years before rectification.
Market conditions in the 905 Region are much more severe than in the City of Toronto. In November sales of all property types in Toronto declined by 7.7 percent year-over-year. In the 905 Region they declined by a shocking 16.8 percent. Average sale prices in Toronto declined by 4.8 percent. In the 905 Region they declined by 8.75 percent.
No doubt this delta is due to the lingering effects of the pandemic when many buyers from the more congested and potentially more dangerous City of Toronto fled to the suburbs, only to discover they preferred the attractions and amenities of the City. Unlike the condominium apartment dilemma, this is not a structural problem and should resolve itself by the natural operation market forces.
Looking at December, we should expect more of what the resale market produced in November, declining sales and average sale prices. Having said that, and as November’s data indicates, resale inventory is gradually being absorbed – for the first time in months new inventory coming to market is less than in the same month last year. This will help to solidify the foundation for renewed activity in 2026, subject of course, to stability in market fundamentals – employment, confidence, macro-economic developments, and affordability. By year end approximately 62,500 homes will have traded hands. Last year over 70,000 properties were reported sold. In 1996 65,760 properties were reported sold. The Toronto and Region resale market is finally poised for improvement.
