Toronto Real Estate Market Report ~ May 2025 | Inventory Climbs, Prices Dip, Confidence Lags

In May, the Toronto Real Estate Board reported 6,244 home sales through TRREB’s MLS® System — a 13.3% decline from the same time last year. At the same time, new listings jumped 14% and active listings soared by over 41% year-over-year, flooding the market with supply and shifting negotiating power toward buyers.

Despite this increased inventory, price drops were modest. The average selling price fell 4.0% to $1,120,879, and the MLS® Home Price Index Composite benchmark declined 4.5%. On a seasonally adjusted basis, both metrics saw slight increases from April — signalling potential early signs of price stability, even as demand remains cautious.

Sales and Average Prices by Home Type

Detached Homes

• Sales: 2,998 (781 in 416, 2,217 in 905)

• Average Price: $1,425,264 ($1,719,937 in 416, $1,321,458 in 905)

• YoY Sales Change: -10.6% (-7.9% in 416, -11.6% in 905)

• YoY Price Change: -5.4% (-5.6% in 416, -5.6% in 905)

Semi-Detached Homes

• Sales: 617 (277 in 416, 340 in 905)

• Average Price: $1,098,447 ($1,299,387 in 416, $934,740 in 905)

• YoY Sales Change: -0.3% (+1.5% in 416, -1.7% in 905)

• YoY Price Change: -6.4% (-8.4% in 416, -4.6% in 905)

Townhouses

• Sales: 1,071 (270 in 416, 801 in 905)

• Average Price: $904,272 ($1,009,698 in 416, $868,736 in 905)

• YoY Sales Change: -9.8% (+3.4% in 416, -13.5% in 905)

• YoY Price Change: -4.5% (-3.3% in 416, -5.5% in 905)

Condo Apartments

• Sales: 1,482 (973 in 416, 509 in 905)

• Average Price: $683,413 ($709,905 in 416, $632,771 in 905)

• YoY Sales Change: -25.1% (-25.2% in 416, -24.8% in 905)

• YoY Price Change: -6.4% (-7.3% in 416, -4.2% in 905)

  
  

Year-Over-Year Summary

• Sales: 6,244 vs. 7,206 in May 2024, down 13.3%

• New Listings: 21,819 vs. 19,147, up 14.0%

• Active Listings: 30,964 vs. 21,880, up 41.5%

• Average Price: $1,120,879 vs. $1,167,646, down 4.0%

• Average LDOM: 25 days, up 31.6%

• Average PDOM: 39 days, up 44.4%

What’s Influencing Buyer and Seller Behaviour?

🔹 Affordability Improving — Slowly Prices are down, borrowing costs have edged lower, and supply is abundant. Yet, sales remain soft — showing that affordability gains alone aren’t enough to spark urgency among buyers still waiting for stronger economic signals.

🔹 Trade Uncertainty Lingers After the federal election, uncertainty surrounding Canada’s trade relationship with the U.S. continues to weigh heavily on consumer confidence. Buyers and sellers alike are watching closely for signs of stability, with many preferring to wait until economic policy becomes clearer.

🔹 Buyers Hold the Advantage With inventory rising faster than sales, market conditions remain favourable for buyers. Listings are sitting longer, and buyers are gaining leverage in negotiations — particularly in the condo and townhouse markets.

🔹 Sellers Adjusting Expectations Some sellers are listing in anticipation of further price declines. With the market tilting in favour of buyers, successful sellers are those pricing competitively and presenting their homes well.

What to Expect This Summer

Analysts from RBC and TD continue to forecast a modest rebound in the latter half of 2025 — dependent on the trajectory of interest rates and international trade stability. RBC expects rate cuts later in the year, while TD has revised its Ontario home price forecast to reflect a 6.4% decline by year-end. Still, both banks see 2026 as a likely recovery window.

Takeaways for Buyers, Sellers, and Investors

📉 Buyers: You're in a strong position to negotiate. If you’re financially ready, now may be the time to take advantage of improved affordability before competition increases.

🏡 Sellers: Be realistic about pricing and market timeframes. Work with an agent who understands how to market effectively in today’s climate.

📈 Investors: With soft prices and rising rental demand, the condo and townhouse segments may present buying opportunities. Location and value will be key.

Have questions about your local market? Message me anytime on Instagram @TorontoRealEstate.ca

— Rylie C.

SOURCES

https://trreb.ca/wp-content/files/market-stats/market-watch/mw2505.pdf