Surge in Toronto Listings Could Spark Spring Buyer’s Market

I believe that the supply situation in January 2025 is a significant data point. It might be the largest year-over-year increase in new listings we have ever witnessed, with condos driving the majority of it. In 2024, we started with 6,300 active condo listings and almost reached 12,000. In 2025, we started with 8,500 active condo listings and could reach 15,000 if historic growth trends continue.

Source: TRREB/TheHabistat.com

I should note that the Toronto Regional Real Estate Board added a few new local boards, so I am still investigating if that has affected the data. However, given that condos are currently dominating the supply on TRREB, my assumption would be no.

Source: TRREB/TheHabistat.com

The GTA real estate market kicked off 2025 with a mix of surprises and challenges. A significant increase in listings, slightly fewer sales, and changing buyer behavior are shaping the early months of what is anticipated to be a transitional year.

So… what’s going on? Let’s analyze three key trends:

• Pent-up supply is finally entering the market.
• Condos are facing more challenges than other types of properties.
• Regional trends are diverging, creating opportunities and risks.

Biggest supply surge in years

I have been anticipating a surge in supply in our market due to the record delivery of new condominiums. The numbers from January confirm it—the GTA housing market is experiencing one of the largest influxes of new listings in recent memory, but demand is not keeping pace.

New listings surged by 48.6% year-over-year, rising from 8,337 in January 2024 to 12,392 this year. Active listings shot up by 70.2%, increasing total available inventory to 17,157 homes from 10,083 last year. However, sales decreased by 7.9% year-over-year (from 4,177 to 3,847) despite this flood of supply.

This indicates that sellers are returning to the market at a rapid pace, and if they continue to outpace demand, the GTA could transition comfortably into a buyer’s market in spring 2025. While most sellers are voluntarily listing their properties, a growing number are being compelled to sell due to financial difficulties, as evidenced by the increase in power of sale listings, noted by realtors Robert Marsiglio and Peter Kiriouzoupoulos.

These lender-driven sales, though a small fraction of total listings, highlight the rising mortgage defaults, adding distressed inventory to an already supply-heavy market. If distressed inventory continues to increase, prudent lenders seeking liquidity in an illiquid market could expedite price discovery.

Source: TRREB/TheHabistat.com

Contrary to sellers, buyers seem to be in no rush. Despite a significant increase in inventory, buyers are taking their time, negotiating more fiercely, and waiting for potential rate cuts before making a move. This is evident in the days on market remaining virtually unchanged in 2025 compared to last year, after rising from 2023 to 2024.

With inventory growth surpassing sales by a large margin, buyers now have more leverage in negotiations in certain product categories, compelling sellers to price more competitively, especially in weaker segments.

If this trend continues, anticipate longer days on market, more price adjustments, and a potential buyer’s market in specific segments. While demand may rebound once borrowing costs further ease in 2025, for now, this significant surge in supply is tipping the market in favor of buyers—creating opportunities for those prepared to act.

Condos are under pressure

If there’s one sector of the market displaying notable weakness, it’s condo apartments.

• Condo sales declined by 12.1% year-over-year.
• In Toronto (416), condo sales dropped by 14.5%, a sharper decrease than in the 905 (-7.4%).
• Condo sale prices decreased by 1.6% across the GTA—the only housing segment with a price decline.

Why are condos underperforming?

Oversupply is emerging as a significant factor in the GTA condo market as a wave of pre-construction completions is expected in 2025. Urbanation forecasts approximately 31,000 new condo units to be finalized this year, substantially boosting inventory. Many of these units were purchased years ago when borrowing costs were lower.

Affordability challenges are also impacting condo demand. Current mortgage rates have elevated carrying costs to new highs, making ownership less accessible for first-time buyers who traditionally enter the market through condos. Meanwhile, the rental market, although still robust, has not kept pace with rising ownership expenses, making it harder for investors to achieve positive cash flow on newly completed units.

What’s next?

Anticipate condo inventory to continue rising in the first half of 2025, potentially keeping prices under pressure until demand catches up. Investors…