Home sales across the Greater Toronto Area (GTA) saw a sharp decline in February, dropping by more than a quarter compared to the same period last year. Despite buyers having significant negotiating power, affordability concerns and economic uncertainty have slowed transactions.
According to the Toronto Regional Real Estate Board (TRREB), 4,037 homes were sold last month—a 27.4% decrease from 5,562 sales in February 2024. On a seasonally adjusted basis, home sales were also down 28.5% from January 2025.
TRREB President Elechia Barry-Sproule stated that many households are eager to buy but face difficulties due to high mortgage rates, making homeownership less feasible for the average buyer.
Prices, Listings, and Inventory Trends
The average home price in the GTA fell 2.2% year-over-year to $1,084,547, while the composite benchmark price dropped 1.8%. Meanwhile, new property listings increased by 5.4% to 12,066 compared to last year, while total housing inventory surged by 76% to 19,536.
Real estate experts suggest that this imbalance between sales and listings is giving buyers more room to negotiate, but affordability concerns persist. Jessica Hammell, a Toronto-based broker, noted that while there are more listings and reduced competition, homeownership remains costly despite the possibility of lower interest rates in the future.
Economic Uncertainty and Market Hesitation
Beyond affordability, macroeconomic factors and geopolitical concerns are affecting consumer confidence. TRREB’s Chief Market Analyst, Jason Mercer, pointed out that Canada’s ongoing trade tensions with the U.S. may be discouraging potential buyers.
“If trade uncertainty is resolved and borrowing costs decline, we could see a much stronger housing market in the latter half of the year,” Mercer said.
The market jitters come as U.S. President Donald Trump’s new tariffs—including 25% duties on Canadian goods and 10% levies on energy exports—came into effect on Tuesday. In response, Canada has imposed retaliatory tariffs on $155 billion worth of U.S. goods.
According to Hammell, real estate does not operate in isolation. Consumer confidence is influenced by global trade policies, economic shifts, and political decisions, all of which contribute to market hesitation.
Breakdown of Home Sales Across the GTA
Home sales declined across all property types in February:
- Detached homes: 31.1% drop
- Townhouses: 30.6% drop
- Semi-detached homes: 22.3% drop
- Condos: 22% drop
Within Toronto city limits, home sales fell 21.2% to 1,540 transactions, while sales in the broader GTA dropped 30.8% to 2,497.
Hammell emphasized that while economic conditions should be considered, real estate decisions should primarily be based on individual needs and long-term goals rather than short-term market fluctuations.
“Many people try to time the market, but it’s only possible in hindsight. The best decision is one that aligns with personal circumstances and financial stability,” she said.
With the market facing interest rate concerns, trade tensions, and economic uncertainty, many buyers are adopting a “wait-and-see” approach as they navigate a shifting real estate landscape.
