Sales Are Up, But Far From Normal
The Greater Toronto Area (GTA) did see a modest 2.3% increase in home sales this August compared to last year. But the numbers remain far below historical averages. Only 118 new condos sold in August, underscoring a preconstruction crisis that refuses to let up.
Why Toronto Is Struggling
Toronto’s slowdown is the result of a “perfect storm”:
- Rising interest rates keeping buyers cautious
- Falling investor demand in the condo sector
- Appraisal challenges dampening deals
- Lower immigration targets reducing population growth
Immigration policy shifts are playing a major role. Historically, about 30% of newcomers to Canada settle in Toronto, fueling housing demand. But with federal targets cut to 395,000 in 2025 (down from 500,000), and further reductions planned through 2027, the GTA’s demand engine has lost some fuel.
Trade Tensions Add More Uncertainty
Tariff battles tied to U.S. trade policies are also weighing on Ontario industries. While Toronto’s diversified economy provides some buffer, sectors like automotive in Oshawa and Alliston remain exposed. The takeaway? Toronto may avoid a collapse, but turbulence is unavoidable.
Prices and Rents Moving Lower
The MLS Home Price Index Composite benchmark fell 5.2% in August year-over-year. Condos remain the hardest hit, with prices slipping and inventory piling up.
For renters, there’s a silver lining: rents are falling as new supply floods the market. Thousands of units under construction — both rental apartments and investor-owned condos — are expected to keep vacancy rates high and rents under pressure well into 2026.
What This Means for Buyers and Investors
For first-time buyers, the GTA remains pricey, but lower rents may create breathing room to save while waiting for potential interest rate cuts. For investors, today’s uncertainty could open opportunities in equity-based lending and alternative mortgage solutions backed by real estate.
📌 At Lendworth, we specialize in helping Canadians navigate turbulent markets. Whether you’re a borrower seeking flexible mortgage solutions or an investor looking for asset-backed opportunities, we’re here to help.
👉 Visit us at www.lendworth.ca to learn more.