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Toronto home prices set to rise in 2025 but condo market on 'different trajectory': Royal LePage report
12/5/2024 | Posted in Toronto Real Estate by Paul DeAdder | Back to Main Blog Page
While the Greater Toronto Area is expected to see a bump in home prices in 2025, condo prices will not recover next year, according to a new report by Royal LePage.
On Thursday, the real estate brokerage released its Market Survey Forecast for 2025, indicating that the aggregate price of a home in the fourth quarter of 2025 will increase five per cent year-over-year to $1,225,770.
“During the same period, the median price of a single-family detached property is expected to rise 7.0 per cent to $1,523,466,” the report read.
Due to a glut of inventory, Toronto’s condo market appears to be on “a different trajectory,” the report notes.
GTA condos are expected to see a one per cent decline in price year-over-year by the fourth quarter of 2025.
“Toronto’s condo market is the softest it’s been in recent history, specifically in the downtown core. With interest rates expected to ease further, thousands of new units slated for completion next year, and new lending policies that will ease the burden of monthly carrying costs, this is a rare window of opportunity for first-time buyers,” Shawn Zigelstein, a Royal LePage broker, said in a written statement accompanying the report.
“The wave of new condo units set to hit the market will offer a period of better affordability, but it will be short lived. Fewer project starts today mean a period of ultra-low completions several years from now. The eventual return of real estate investors to this segment will result in increased competition down the road.”
He said the Bank of Canada rate cuts have now begun to entice buyers back into the Toronto housing market as they waited for “prices to reach their floor.”
“Following the supersized rate cut made in October, the tide began to turn and activity picked up materially. This momentum is expected to persist through the winter months, giving way to an early spring market in 2025,” Zigelstein said.
“While this boost in activity has not translated into an increase in prices just yet, inventory that had been building up over the past several months is now being quickly absorbed. Another significant batch of supply is unlikely to come online before spring, meaning buyers re-entering the market will start to feel competition heat up and see some upward pressure on prices.”
Source: CTV News
