The pace has slowed, competition has eased, and choice is back on the table. “As a buyer, you’ve never seen this much selection,” says Toronto realtor Danielle Demerino. “Inventory keeps climbing, and sellers are realizing they can’t price like it’s 2022 anymore. In many cases, homes are selling at roughly an 18% discount from the market peak.”
A New Market Psychology
This “new normal” is being shaped by affordability challenges and rising borrowing costs. Homes that once sold in days are now taking a month or more to move, with most buyers motivated by life transitions rather than speculation.
“People buying right now are doing it out of necessity—new families, relocations, or simply moving up while prices are lower,” explains Demerino. “They might take a hit on their sale but gain value on their next purchase.”
Prices Down, Activity Stabilizing
Despite softer prices, September data shows early signs of balance returning. Home sales were up 8% month-over-month, even as average prices slipped nearly 5%. Sellers have adjusted expectations, and developers are hitting pause—creating potential supply pressures for the years ahead.
“There are very few housing starts and nearly a 90% drop in land purchases,” Demerino notes. “That’s going to lead to a shortage of new homes three to five years from now.”
Interest Rate Cuts Offer a Glimmer
The Bank of Canada’s recent rate cut to 2.25% could nudge some hesitant buyers off the sidelines, but most experts agree it won’t spark an immediate rebound. “This isn’t a flip-the-switch moment,” says Demerino. “It’s more of a gradual reset—steady, cautious, and overdue.”
Balance Returns to the Market
After a decade of runaway price growth, Toronto’s cooling phase may be exactly what the city needs: breathing room. Buyers can finally negotiate, sellers are adjusting to reality, and the market is finding its footing again.
For the first time in years, Toronto real estate isn’t just about speed—it’s about strategy.
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