Your definitive guide to the Toronto & GTA housing market

Your definitive guide to the Toronto & GTA housing market

When it comes to navigating headlines and making informed choices about the Toronto housing market, it’s hard to know what to focus on. That’s why we've created this space: to help you stay in the loop with what's happening in Toronto and GTA real estate. We update it often, so you can always come here for the most current stats, news, insights and more.

1. UNDERSTANDING THE MARKET

Toronto housing market: what you need to know right now

GTA buyers are back in the building

February saw a surge in both home sales and new listings (compared to the previous year, but still below the 2021 peak), boosted by population growth, the resilience of the regional economy, and the market assumption that the BoC is done hiking rates – an assumption further solidified by its March 6 decision to hold rates at 5% for the fifth time in a row. 

Despite higher borrowing costs, sales activity was up 17.9% year over year, reaching 5,607 transactions. Buyers had more options as new listings jumped 33.5%.

With home prices remaining stable – the average selling price rose by only 1.1% to $1,108,720 – economists anticipate increased buyer activity as we move further into 2024, especially in the second half of the year when lower interest rates are expected to stimulate demand. 

As for the continued demand for housing? Thanks to record population growth, the GTA housing market is set to continue outpacing supply in the years to come, underscoring the need for ongoing efforts to address housing accessibility and affordability.

Market Insights at a Glance

Got questions? Our agents have the answers: get in touch with one of our area experts anytime.


What's the difference between a buyers' and a sellers' market?

It all comes down to supply and demand – and who has the advantage in a sale, the buyers or the sellers. 

What is a buyers' market?

It's when there are more properties for sale than there are interested buyers – when supply exceeds demand. There's less competition, prices drop, properties stay on the market longer, buyers can stipulate conditions, and sellers have to do a lot more in the way of marketing, staging etc. to attract buyers – and be willing to negotiate to make a sale happen. 

Right now, we are very much in a buyers’ market: there are many more properties available than buyers who want to buy them. So what does that mean for you? Basically, if you have the means to buy in this high-interest-rate climate, or you don’t need to get a mortgage (e.g. you’re downsizing from a paid-off home), you’re at an advantage. Prices have softened, and sellers are negotiating and accepting conditional offers.

What is a sellers' market?

It's when there are more buyers than available properties. When supply is low, competition ramps up. Properties sell faster, for higher prices, and buyers are willing to do more (foregoing conditions, agreeing to shorter closing dates, offering more money and accepting properties “as is”) when they're competing with other bidders. There’s less opportunity for buyers to negotiate: the sellers are in control. 

So what does all this mean to you?

I’m a buyer in a buyers' market. If you have the budget to buy and can qualify for a mortgage,the world is your oyster. Lots of selection, less competition, less pressure and plenty of good opportunities to be had. That said, if you LOVE something, you still need to move quickly. A great property is a great property, and it will get snapped up no matter what the market.

I’m a buyer in a sellers' market. You’ll need to jump on listings fast, expect to compete with multiple offers, and find ways to encourage the sellers to pick you over other bidders. 

I’m a seller in a buyers' market. First off, don't panic. Don't sell if you don't have to, but if you do need to move, you can still get a good price by making your property stand out with great staging and marketing. 

In this kind of market, properties take longer to sell – and sometimes may require a shift in strategy to get buyer attention – so it helps to be patient.

I’m a seller in a sellers' market. A good sales strategy will likely net you a great selling price without conditions. A great agent can really help you here by leveraging offers against each other and fighting hard for you. 

A good agent is your best friend, no matter what the market

Ultimately your best bet is to work with a very seasoned REALTOR®, one who understands individual micro markets and can guide you through a smart move.

Adapted from Expert weighs in on the new real estate regulations, originally published in Storeys magazine

EXPERT: Weighing in on the new real estate regulations 

On December 1, the province brought in the Trust in Real Estate Service Act (TRESA), updating the rules that govern real estate professionals in Ontario. Check RECO’s new guide to working with an agent for details. In this article, I’ll look at the biggest changes and their impact on buyers, sellers, real estate agents and the market. 

Change #1: a new open offer process

The old blind bidding process is no longer the exclusive method for selling a property: sellers now have another option where they can share information about competing offers. It's a move designed to increase transparency and prevent huge price jumps. But while the sentiment behind the change is an admirable one, there's one thing that takes the teeth out of it: revealing this information is 100% up to the seller. So, if a seller wants to play buyers against each other in a blind bidding war, they still can. In most cases, not being transparent could be in a seller’s best interest.

However, there are situations where it will make sense to share, depending on market conditions. Open offers could attract buyers who might otherwise stay away from a listing in a hot neighborhood. And it could actually result in a higher price, as buyers see exactly what they're up against and stay in the game rather than walking away. 

Navigating this new system is going to take some figuring out. There are a lot of moving parts to open offers. Sellers can decide how much they want to share. But buyers may want a say too: we’re already seeing confidentiality clauses that prevent sellers from disclosing. And if sellers decide they want to switch to blind bidding, they can. It’s a situation that has the potential to get complicated and will require the expert guidance of an agent. 

VERDICT: jury’s still out. 

Change #2: A clearly defined client-agent relationship

The old regulations differentiated between a customer and a client: a client got full fiduciary duties and responsibilities, while a customer got access to limited information and no fiduciary support (like advice on how much to offer). That all got a little murky, so RECO has done away with the whole customer category. Now you're either a client who gets the full services of your agent or you're not. There's no gray area. 

So what happens in a situation where you go to an open house, meet the listing agent and want to make an offer without engaging your own realtor? In this case, you’re a “self-represented party.” The agent can give you information about the property, but that’s it. They can’t offer you services, opinions or advice and will only work in the interest of their client. There's no conflict of interest here, just clarity. 

Verdict: good. 

Change #3: RECO has been given more clout

TRESA has given the Real Estate Council of Ontario (the regulatory body that oversees real estate professionals in the province) more power to enforce the rules. They have revised the code of ethics, focusing on integrity, confidentiality, conflicts of interest and fraud prevention. They now have greater ability to administer fines, revoke licenses for misconduct, hold brokerages and their agents accountable for non-compliance, and provide consumers with added protection. 

Verdict: excellent. 

Overall, I'd say TRESA is taking our industry in the right direction. I look forward to greater transparency, clearer rules – and a better experience for clients and agents alike. 

What’s the deal with open offers? 

People have been asking to bring transparency to the offer process for a long time. So the government has come up with a compromise: they've introduced open bidding, but made it optional. In other words, it's up to sellers to decide if they want to be open with bidders. 

Are open offers good for sellers? It depends. 

To be honest, I'm not sure how all of this will play out. The market will certainly influence seller decisions, and I predict we will see more blind bidding when the market gets hot again. But I also think there are a number of advantages to showing buyers your hand.

Another benefit to a transparent approach? When buyers can see exactly how much more they'll need to offer to stay in the running, they'll be a lot less likely to walk away in defeat, thinking the final price will be way out of their range. 

Open offers could actually drive prices up

Although the new process is meant to curb big price jumps, it could potentially get sellers more for their properties than blind bidding – as in my example. When bidders can see what they're up against, it basically becomes an auction – one that only ends when people stop bidding. Australia, which has an open auction-style system, has seen prices climb in ways similar to Canada's. Supply and demand is what drives price – not the selling system.

Read the full article

2. BUYING

Is now a good time to buy?

It’s hard to be a buyer right now – especially if you’re doing it for the first time. The stress test is at a tough-to-qualify-for 8%, making it more challenging than ever to get a loan. It’s no surprise a lot of buyers have decided to step back and wait for the market to soften further or interest rates to drop. 

But. Because so many buyers are in “wait and see mode,” there are a lot more listings out there to choose from right now, and sellers are motivated. So if you have the means to pay current interest rates for a while, you could be in a very good position. 

“When rates eventually come down – and they will,” says Sean Miller, Sales Representative at Property.ca Inc., “You will end up paying a lot less than if you had bought at a higher price with a lower initial interest rate. Remember, you can always do a short-term fixed-rate and refinance when rates come down – or stay variable and ride the wave, which seems to be a thing again.”

Want to know how you can take advantage of the current market as a buyer? Read this.

Sign up at condos.ca or property.ca today to get all the info you need to buy smart.

Is it better to buy or rent?

Most agents will always advise you to buy now if you can – and buy whatever you can. And here’s why:when you buy, you'r putting your money back into your own pocket and taking advantage of appreciation. But if you keep waiting so you can afford the “perfect” place, or renting while you try to time the market to get the best price, you’re handing money over to someone else instead of putting it towards equity. 

If you’ve got enough for a down payment, even if it’s for something really small or in a location you don’t love, decent credit and a stable job, you’ll most likely be further ahead if you buy instead of renting.

Your first place doesn't have to be your forever home

Can’t afford a house? Buy a condo. Don’t have enough for a 2-bedroom? Get a 1-bedroom. If that’s still too much, go for a studio. And if a studio downtown is out of your reach, buy one in a less expensive neighborhood – or even in another city. 

If it’s too small for you or not in a location you like, that’s ok. Stay in your rental or live with your family for a while: your renter will pay your mortgage as you build equity and let the property appreciate. It’s a formula that works, but it takes time. 

Can’t afford to buy the home you want? Read this!

Still can't afford to buy something right now?

Everything you need to know about Canada’s Tax-Free First Home Savings Account

The Tax-Free First Home Savings Account (TFHA), which officially came into effect on April 3, 2023, is a great addition to your down payment saving arsenal. Here’s what you need to know: 

  • You can contribute $8K a year – to a total of $40K per person.

  • You cannot have owned a property in the last 4 years

  • You can only use it to buy a place you’re going to live in

  • You can combine it with your First-Time Home Buyers Plan

And here’s the best part: unlike the First-Time Home Buyers’ Plan, which lets you borrow from your RRSP,  you don’t have to pay it back. And you can combine the two programs to help you get to your goal faster. 

This very comprehensive overview from the Department of Finance has everything you need to know about the TFHA.

Read more: Tax-free savings tools to help you buy your first home

Understanding value using sold data

Not sure what you should be offering for a property – or if it’s a good value? Looking at what properties have sold for recently will tell you everything you need to know about current value. Condos.ca and property.ca make that easy: simply toggle your search from “for sale” to “sold,” and you’ll find the sold prices for every property in the building and neighbourhood.  

How to search sold data

Search filters help you compare apples to apples – if you’re looking at a 750 sf 2-bedroom downtown in a building with a pool, use filters to find similar properties, and voila! You’ll see what the place you’re interested in buying will potentially sell for.  It’s easy to filter by time period, too: simply select what has sold in the last 7 or 14 days for the most current price data. 

Read more: How looking at sold properties can help you make a winning offer

Inflation and interest rates 101

Want to know why the Bank of Canada has raised rates so many times – and what it could mean to your real estate goals? This section will help you understand overnight rates vs. bank rates, variable rates vs. fixed rates, and what they have to do with inflation. 

Inflation basics

The inflation rate is a measure of how much prices for things like food, shelter and transportation go up over time. 2% a year is a healthy amount, but right now, we’re at about 3.3% which is certainly a whole lot better than the 8% high back in June 2022, but it's still not where the Bank of Canada wants us to be. Which is why they’re currently holding steady on rates rather than dropping them.

The pandemic is to blame, impacting global markets, causing supply chain issues, and changing the way people spend. Then there’s the war in Ukraine, which is causing massive uncertainty and wreaking havoc on the global economy. Prices have been going up so fast that our incomes can’t keep up.

The only way to slow inflation is to cut consumer spending – and that’s where the Bank of Canada interest rate hikes come in. Higher interest rates make it more expensive to borrow so people spend less, and make saving money more attractive by allowing higher earnings on investments.

As soon as inflation has gotten back to a healthy level, interest rates will start to come back down. However, experts predict that that won’t happen until late 2024 or early 2025 at the earliest.

All about interest rates

  • Overnight rate. The rate that’s set by the Bank of Canada. The current overnight rate is 4.25%. This is NOT the rate you’ll pay to borrow – it’s the rate banks use when lending money to each other.

  • Prime rate. This is based on the overnight rate and is the foundation for the rate banks charge consumers. Right now, the prime rate is 6.45%.

  • The actual interest rate you pay. The bank rate is based on the prime rate, but what you actually pay depends on the type of mortgage you get, your credit rating, and other factors.

  • Variable rate mortgage. This is a mortgage where you pay at the going interest rate. Your payments either fluctuate month to month based on the current rate – or they stay the same, but the amount that goes to interest and principal changes if the lending rate changes.

  • Fixed-rate mortgage. This is where you lock in at a certain rate for a specified amount of time. Your payments are predictable and you’re protected from rate hikes for the loan term, but your rate is higher than with a variable rate.

How can I help my kids buy?

Want to help your kids get into the market? You’re not alone. More and more parents are tapping into their own savings and equity to help their kids become homeowners

1. Gift them the money. “It’s a great way to give them part of their inheritance now, tax-free,” says James Harrison of Mortgages.ca,. “If you can help them get to 20% down (or more), that will help significantly with buying power – and they won’t have to pay for SMHC insurance.” 

2. Lend them the money. Be very clear about repayment terms. Having paperwork in place will be helpful if a couple splits up or they default on their repayment.

3. Co-sign or be a guarantor on their mortgage. Adding yourselves to the mortgage will give your kids more borrowing (and buying) power. However, if your kid defaults on the mortgage, your credit rating could take a hit – and you'll be on the hook for payments. 

4. Buy a property together. This is a great option for parents who want to get their investment back when the home is sold. Whatever percentage you put in, that's what you'll get back at the end. 

5. Buy the property yourselves, then transfer ownership later and pull out your equity. This is a great option for parents of students who are coming to the GTA to go to college or university. You can buy a place for them to live in while they're in school, then once they graduate and are working, they can take over the mortgage payments. 

6. Let them live with you while they save their down payment. Offer up a free (or cheap) place to live. GTA rents are nuts, and not having to shell out $2,500 or more a month will add up fast. 

Read more: 7 ways parents can help their kids become homeowners

3. SELLING

Is now a good time to sell?

Really special properties or those in high-demand locations will always do well. But right now, it’s not exactly a sellers’ market. Homes are still selling, of course, but there’s a lot of inventory on the market, and buyer demand has cooled more with each interest rate hike. 

For sellers, pricing and marketing are everything. Be realistic when you’re setting your price – otherwise your listing could just sit and get stale. Make your property as appealing as possible to buyers. And yes, that means spending money on staging. It makes a difference. 

If you’re upsizing or downsizing, this may be a good time to sell first, then buy. You’ll know exactly how much money you have to work with – and will face a lot less pressure to unload your old property before you close on your new one.  

Sign up at condos.ca or property.ca to find the data you need to sell with confidence.

Price, presentation, promotion: what sellers need to know right now

How do you sell successfully right now? Here’s what Todd Armstrong, Property.ca Inc. West GTA branch manager and Josh Benoliel, VP of Sales, have to say. 

1. Price it right

“Before making any kind of pricing decision, get a handle on what’s going on in your neighbourhood,” says Todd. “If all the local listings are priced low with offer dates, that should be your strategy too. Because if everyone else is doing that and you list close to market value, buyers won’t bite. They don’t know what’s in your head – they’ll just assume your place is out of their range.” 

On the other hand, if everyone in the building or area is pricing at market value, then that should be your approach too. And if it’s a mixed bag? Listen to your agent, and do what they recommend. 

One thing to remember, though: underpricing a home does not guarantee a bidding war. Especially in this market. You could just end up getting offers that are way lower than what you want – or none at all. Only specific types of homes – unique, renovated, in great locations, with great views on high floors, etc. – tend to garner that kind of attention. 

Read more: Everything you need to know about selling a property in Toronto and the GTA.

2. Focus on great presentation

“If you want to do well right now, your property needs to be a 10/10,” says Josh. “Buyers tend to gravitate towards the showcase-ready homes.” 

  • Fix everything that needs to be fixed. Replace caulking, fix broken tiles, recaulk bathtubs, scrub light switches, replace loose door handles, patch the cracks in the driveway, weed the patio. 

  • Make first impressions count. Buyers have 50% made up their minds as soon as they’ve walked in the door. Invest in making the exterior and the entryway as appealing as possible. 

  • Brighten up the place! Todd recommends 3000 kelvin bulbs throughout to ensure paint colours appear true. Avoid blue LEDs or fluorescent lights – they make a room feel cold and antiseptic. 

  • Stage it. Todd says every dollar spent on staging means the sellers get $3 back. It pays to help buyers envision the possibilities of living there. 

Read more: 9 reasons your home isn’t selling

3. Promote the heck out of it

The more people see your listing, the better, so find an agent who will get it in front of as many eyes as possible. Todd’s top tip: work with a Property.ca Inc. agent – your listing will automatically be featured on condos.ca and/or property.ca, high-traffic sites that’ll get you amazing exposure. Also, hire an agent with a strong following on social, and focus on really great photos. If you’re selling a condo, don’t forget to include appealing pics of the building amenities. Read the full blog post here.

Want to see what properties in your area have sold for? Here’s how to search recently sold listings.

3. RENTING

Toronto's record-breaking rental market

It isn’t easy being a Toronto renter: rent continues to outpace the rate of inflation. Average rents appear to have fallen somewhat over the last month or two (which may be the start of a trend, or just a seasonal dip) – but finding a place in the city is still staggeringly expensive. We are in a rental crisis, with a housing shortage exacerbated by record immigration numbers. 

In February, the average rent for a 1-bedroom in Toronto was $2,495. For a 2-bedroom, it’s currently sitting at $3,287 (data is taken from rentals.ca). Roommate rentals are hitting new highs as well: the average roommate rental is now over $1,300 a month.

Get the scoop on the numbers in Rentals.ca’s National Rent Report

Notes on a rental crisis

John Lusink, President, RealServus, looks at the reasons behind soaring prices and the lowest vacancy rates we’ve seen in years. 

The CMHC’s recent Rental Market Report paints a sobering picture of a full-blown rental crisis. Canada-wide, vacancy rates have hit record lows. Purpose-built rentals (apartments) are at a 1.5% vacancy rate, with rental condos at 0.9%. In Toronto, things are even tighter: the rate for available condos is currently an impossible 0.7%, the lowest in decades. Compare that to the 3% vacancy rate the CMHC says is healthy, and you see the severity of the issue.

Availability of rental units is actually up quite a bit year-over-year. But while there are more places being listed, the extreme demand is absorbing those numbers. And with that demand come soaring rent prices. 

The cost to rent a home has vastly outpaced both inflation and wage growth. People are spending more of their incomes on housing than ever before, which means they're saving less (if anything at all), putting them out of the running for home ownership. So even if they can find a place, a lot of people simply can't shell out $2,500 or $3,500 every month. 

Lack of affordability is putting many in an untenable position – and that’s when you end up getting troubling reports like the recent BlogTO article about 25 international students living in a basement in Brampton. 

How have we gotten to this place? A number of factors have brought us here.

The surging population.

In 2023 alone, an unprecedented 1.2 million immigrants and non-permanent residents came into Canada. This has been a huge contributor to the rental crisis, and it isn't something anyone accounted for in forecasts or economic models. 

High borrowing costs. 

Peak interest rates and high property prices are keeping renters from becoming homeowners. By continuing to rent, they’re adding pressure to the market. 

Developers are sitting on a pile of unsold inventory. 

Unsold new condo inventory increased 41% year-over-year, growing to over 22,000 units at the end of 2023. The majority of those units would have been added to the rental supply, but instead, they're sitting empty. 

New construction has slowed to a crawl. 

With all that unsold inventory out there, developers have pretty much put down their shovels. In the second half of 2023, construction activity in the GTA fell by 72% year-over-year, with only about 4,400 starts recorded. 

Investors can't afford to be landlords anymore. 

Condo listings for sale have increased dramatically, and it’s no surprise. Because even when they’re able to charge market-rate rents, those paying today’s interest rates can’t cover their costs through rent. 

Turnover is low, low, low. 

Renters know they can't move without paying more for less space. So even if their current place isn't meeting their needs, most are staying put – which is yet another variable keeping inventory off the market. 

Read the full article

Looking for a rental right now? 5 things to keep in mind

Competition for leases is fierce. But going in educated and prepared can help: here are some helpful insights to be aware of as you search. 

1. You may face a bidding war. For a rental? Yep, especially for properties under $2,500.

2. It comes down to eliminating uncertainty for the landlord. Landlords don’t want risk. A letter of employment, your last few pay stubs, a credit report, and a completed OREA rental application will go a long way. Proof of your legal status in the country will also help reassure them. Some motivated renters have even been offering several months’ worth (up to a year!) of rent up front. Keep in mind that while it’s okay to accept this kind of payment if it’s offered, it’s NOT legal to request it. 

3. Be ready to move fast on a unit you like. With stiff competition for rental units, you won’t have time to think it over or get your credit report done before submitting your offer. Have all your documents ready to go before you start looking, and you’ll be able to make quick decisions. 

4. Some tenants are offering prepaid rent. Landlords aren’t legally allowed to ask for anything more than first and last months’ rent, but they can accept it if it’s offered. Just be careful: working with a REALTOR® will help protect you against scams. 

5. Working with an agent gives you an edge. Real estate agents know how to present a client and structure an offer so the landlord will say yes. But even with a good agent, it’s competitive out there. Even great quality renters are being turned down right now. 

Looking for a Toronto or GTA rental? Search properties for rent on condos.ca or property.ca to be matched with a lease specialist agent who will give you an edge over the competition and help you make a great move. 

3 things investors should know about the Toronto rental market right now

If you’re thinking about buying an investment unit to rent out, here are a few things to keep in mind: 

1. Rental units in most parts of the GTA are in hot demand. “There isn’t a lot of supply out there, and everything is getting rented,” says Julian Kashani, Broker. “There are more tenants than landlords, and available units are getting snapped up fast.”

2. You may get multiple offers for your property. The typical offer is around $25 to $100 more a month, sometimes with a quicker closing. However, some of our agents have been seeing multiple offers as high as $300 over asking, especially in high-demand neighbourhoods, where some have gotten up to 18 offers on a rental property. 

3.  Investors with variable-rate mortgages are getting hit hard. Many investors are facing skyrocketing costs and negative cash flow. Those with long-term tenants in units built before November 2018 are unable to raise rents due to rent control measures. And monthly mortgage payments have gone up so significantly that even those landlords who are able to rent at market rates aren’t getting all their costs covered. That could mean more investors will end up selling their properties rather than continuing to operate at a loss – especially those with tenants paying well below market rates.

Read more: Best neighbourhoods in Toronto for renters

Ready, set, RENT: the condos.ca rental process

Why do you need to have your credit check and letter of employment ready before going to see a rental unit? It’s a question our agents get asked a lot, and the answer is simple: it ensures you’ll go in knowing what you’re qualified to rent. Plus you won’t lose out on a great place you love because you don’t have all your paperwork ready.

Desirable condos are moving fast, and renting with really quick timeframes: if you have to wait for HR to get you a letter of employment, that cute unit with the great view will end up going to the renter with all their docs ready to go.

Here’s what you need before viewing properties

  1. A completed rental application (your agent will provide the right one)

  2. An employment letter that lists your position, salary and contact info for your manager/HR dept

  3. Your credit score and report from Equifax or TransUnion

  4. References (optional, but recommended)

Download: 5 steps to renting your next condo (one-page printable guide)

Once you’ve got all those docs in hand, you can start your search. But first, register for a condos.ca account (if you haven’t already). It will give you access to all the useful information on the site, and connect you with a Property.ca Inc. agent who can help you find a great place.

Found a listing that looks good? Go see it! Just schedule a time with your agent.

Looking for a rental in downtown Toronto? See what’s out there in your price range.

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