TORONTO — Home sales within the Greater Toronto Area (GTA) experienced plummeting numbers this February, marking over a quarter decline compared to the same month last year. According to the Toronto Regional Real Estate Board (TRREB), 4,037 homes were sold, signifying a staggering 27.4% drop from the 5,562 sales recorded during February 2024. Seasonally adjusted, the numbers tell an even bleaker story: sales dropped by 28.5% from January 2025.
The trend continues with average selling prices reflecting the downturn. The average price for homes sold fell by 2.2% to $1,084,547, with the composite benchmark price also down by 1.8% year-over-year. Jason Mercer, TRREB chief market analyst, attributed part of the decline to macroeconomic pressures, including concerns over Canada's precarious trade relationship with the United States.
"Many households in the GTA are eager to purchase a home, but current mortgage rates make it difficult for the average household to comfortably afford monthly payments on a typical property," stated Elechia Barry-Sproule, TRREB President. This sentiment echoed across the market, emphasizing the financial strain buyers are facing amid rising costs.
February also revealed 12,066 newly listed properties, marking a 5.4% increase compared to last year. While more homes are on the market, total inventory has shot up by 76% to reach 19,536 homes. This surge highlights the widening gap between supply and demand, as buyers remain hesitant.
Mercer underlined the psychological impacts of broader economic uncertainty, noting, "Uncertainty about our trade relationship with the United States has likely prompted some households to take a wait-and-see attitude toward buying a home." This cautious approach could be gauged through the decreasing sales numbers, as homeowners are perhaps waiting for more favorable conditions before making any decisions.
Despite this pessimism, some experts remain hopeful for the future. With anticipated declines in borrowing costs potentially within reach, there could be relief for struggling buyers. Mercer expects these shifts might lead to improved affordability, stating, "If trade uncertainty is alleviated and borrowing costs continue to trend lower, we could see much stronger home sales activity in the second half of this year."
Yet, the market remains at stake as external factors continue to complicate buyers' decisions. TRREB Chief Executive Officer John DiMichele emphasized the importance of political clarity during this turbulent time. "Clarity from lawmakers... will be imperative to bring buyers off the sidelines," he asserted. The interplay between governmental policies and consumer confidence remains pivotal.
The recent Ontario provincial election and the complicated federal political environment have added layers of uncertainty to the housing market. DiMichele noted, "Not only do policymakers need to make clear their direction on housing supply and affordability, but they also need to be clear on how they intend to tackle issues related to trade and the economy." His remarks highlight the urgency for decisive action to restore confidence among prospective buyers.
Looking back on this winter, as home sales cooled, there was optimism following the revival from a slow summer 2024. Going forward, the market will have to navigate uncharted waters as economic indicators continue to fluctuate. The situation remains dynamic, leaving potential buyers and sellers on edge about what the coming months might hold.
Encapsulating the current stark reality faced by both buyers and sellers, Barry-Sproule observed, "the current market reality reflects financial burdens and external pressures weighing heavily on the minds of prospective buyers, as they contemplate their financial futures." The future of the GTA housing market hinges on significant policy direction and changes within the economic climate.