The Greater Toronto Area's housing market closed 2025 at its weakest point in 25 years, with sales volume hitting a low not seen since the turn of the millennium. This slump occurred despite a combination of factors that traditionally stimulate buying: falling prices, declining mortgage rates, and a surge in available listings.
A Market in Deep Freeze
According to year-end data from the Toronto Regional Real Estate Board (TRREB), only 62,433 homes were sold across the GTA in 2025. This figure represents an 11.2% decline from 2024 and marks the lowest annual sales count since the year 2000, when 60,783 properties changed hands.
The board pointed directly to pervasive economic uncertainty as the primary culprit for the eroded consumer confidence. This sentiment was exacerbated by trade tensions, notably U.S. President Donald Trump's implementation of tariffs on a range of Canadian goods not covered by existing trade agreements.
"GTA households must be confident in their employment situation before committing to long-term monthly mortgage payments, even in this more affordable market," stated Jason Mercer, TRREB's Chief Information Officer.
Affordability Improvements Fail to Spark Demand
On paper, market conditions improved for buyers. Mortgage rates trended downward throughout the year, and a 10.1% increase in active listings helped push prices lower. The average selling price for a GTA home in 2025 was $1,067,968, a 4.7% decrease compared to 2024.
TRREB President Daniel Steinfeld acknowledged that these fundamentals are trending positively for a potential recovery. "Once households are convinced that the economy and labour market are on a solid footing, sales will increase as pent-up demand is satisfied," he said.
However, the year ended weakly, with December sales down 8.9% year-over-year, indicating the downturn persisted through the final month.
Calls for Government Intervention and a Grim Outlook for New Homes
The board's leadership is urging all levels of government to step in. TRREB CEO John DiMichele called for policies that provide financial relief to potential buyers. "Fair and responsible tax policies can put more money back into people’s pockets, restore consumer confidence, and rebuild trust in the economy," DiMichele argued.
The crisis extends beyond the resale market. The new home sector is experiencing a severe and prolonged contraction. The Building Industry and Land Development Association (BILD) reported that new home sales have been falling for 22 consecutive months. In November 2025, there were only 510 new home sales in the GTA—a drop of 35% from November 2024 and a staggering 83% below the 10-year average.
Edward Jegg, a research manager at real estate consultancy Altus Group, described the new home sales figures as "grim." He noted that affordability remains the central obstacle, with little immediate flexibility to reduce development costs. The data paints a clear picture of a regional housing market stuck in a deep freeze, waiting for a sustained thaw in economic confidence before any meaningful recovery can begin.
