As they say, "In November, we trade motivation for mugs."
When you look at the Toronto real estate market right now, it certainly feels like the market has decided to hibernate early. Let’s get straight to the stats so we can focus on staying warm.
Here is the raw reality:
Average Selling Price: $1,039,458. That is down 6.4% from last November. To put that in perspective, that’s a price drop of roughly $71,000 on the average home compared to last year.
Home Sales: Down 15.8% year-over-year. The volume just isn't there.
New Listings: Down 4% compared to last year. Even with fewer sellers entering the market, inventory is lingering.
The "Absorption" Rate: The Sales-to-New-Listings Ratio dropped from 51% last year to 45% this month.
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Translation: For every 100 homes that hit the market in November, 55 didn't sell.
Without context, these are just scary numbers. So, let's measure this against history.
The average sales volume in Toronto from 2012–2024 is 94,580 homes per year. That includes the frantic highs of 2021 (127,313 sales) and the lows of 2023 (69,889 sales).
If we give December a generous chance of clocking another 3,500 transactions, 2025 is on track to finish with around 62,275 total sales.
That would make 2025 the slowest year in over a decade—coming in about 11% lower than 2023 and which was already considered the worse year.
Is there a light at the end of the tunnel?
The good news is that nearly all major banks are predicting either rate cuts or a "hold" strategy moving into 2026. The only outlier is Scotiabank, which is currently forecasting a potential slight increase next year. [LINK]
The consensus among economists is that a bottom will likely form in 2026, with a slow, steady recovery starting in Q3 2026 or early 2027.
So, what does this mean for you right now?
It depends entirely on which side of the table you're sitting on.
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We are seeing sellers pulling listings to rent them out for another two years, and we are seeing investors swallowing as much as $340,000 losses on pre-construction units purchased 6 years ago that they simply cannot close (not our purchase thank god!)
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On the flip side, we have dealt with a client that picked up a fantastic unit in Yorkville for $1,200 per sq. ft. (parking included) a price that was unheard of recently.
There is opportunity in every market, but only if you look at the numbers without the sugarcoating.
Reach out if you have questions about your specific position. We’re glad to talk.
Until next month...
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