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.