We're in an interesting moment — where a lot is changing, but not everything is as doom-and-gloom as the headlines might suggest. Here's a grounded look at six things shaping the market right now.
1. Less than 1 in 5 homes are selling over asking
At the peak in 2022, over 80% of homes were selling in bidding wars. Today that number is around 18% — a level we haven't seen in over a decade. In plain terms: most homes are now selling below asking, and buyers have real room to negotiate. Sellers need more than just a "For Sale" sign — strategy matters more than ever.
2. Pre-construction sales in Toronto have collapsed by 86%
New condo sales in Toronto are down 86% from the annual average — more than any other major Canadian city. Higher borrowing costs, investor pullback, and delayed project launches have all contributed. If you've bought pre-construction, or are considering it, this shift is important to understand. Assignments may increase as investors look for exits, which could mean significant price drops on those deals. New launches could slow further.
3. Downtown Toronto rents are falling every quarter in 2025
One-bedroom rents in downtown Toronto have dropped for three straight quarters — from $2,244 in Q1 to $2,122 in Q3, a 5.4% decline over that period. Tenants are doubling up. Some are leaving the core. Meanwhile, more units are coming to market from investors who bought pre-construction during the peak years. If you're a landlord or investor, lease renewal strategy and new listing pricing both need to reflect this softer environment.
4. Prices are back to 2021 levels
Looking at the MLS Home Price Index across the GTA, even after all the recent price drops, home values are roughly back to where they were four years ago:
Pickering and Ajax: prices now equivalent to March 2021
Toronto, Richmond Hill, Mississauga, Brampton: back to February 2021 levels
Markham: back to May 2021
You could say we've simply given back the pandemic-era gains. If you bought in early 2022, you may feel underwater — that's real. But context matters: real estate and construction make up roughly 20% of Canada's GDP. A market collapse wouldn't just hurt homeowners — it would ripple through jobs, local economies, and retirement savings. The structural supports for the market are significant.
5. Rates: stable for now, with fixed rates quietly coming down
The Bank of Canada held its rate steady at the last meeting. Economists remain divided on whether cuts are coming this fall. In the meantime, bond yields have dropped, and fixed mortgage rates have been quietly coming down. If your mortgage is up for renewal or you're buying soon, this is a good time to shop around and explore fixed-rate options. Use our mortgage calculator to see what current rates mean for your specific situation.
6. The long game still matters
Short-term corrections are normal. Every serious investor or long-time homeowner knows this — corrections come, and then they go. For many families, real estate remains one of the most powerful tools for building generational wealth. That hasn't changed.
If you have questions about what any of this means for your situation, reach out. Happy to talk it through.
