Toronto’s real estate market ended 2024 on a steady note, with 3,359 home sales recorded across the Greater Toronto Area (GTA) in December.
This represents a 2.6% increase compared to December 2023, highlighting the resilience of the market despite affordability concerns and shifting buyer sentiment.
While overall home prices remained stable, specific property types saw varying levels of demand, with some segments outperforming others.
December 2024 Market Breakdown
The 3,359 homes sold in December 2024 reflect moderate but steady growth in the market. Detached homes remained the most in-demand property type, accounting for 1,544 sales, while condos followed with 972 units sold. Semi-detached homes recorded 514 transactions, and townhouses contributed 329 sales.
The average home price in the GTA reached $1.1 million, marking a 4.8% year-over-year increase. Detached homes saw their prices climb to $1.46 million, up 3.5% from last year, while semi-detached homes averaged $1.12 million, reflecting a 3.6% increase. Condo prices, however, declined by 1.5% year-over-year, settling at $741,000, as increased supply continued to weigh on the segment.
New listings rose sharply, with 6,912 properties entering the market in December, representing a 16.4% increase year-over-year. The higher inventory has provided buyers with more options, shifting the market away from the intense competition seen in previous years.
What’s Driving the Market’s Performance?
The steady rise in home sales can largely be attributed to the Bank of Canada’s recent interest rate cuts, which have improved affordability for buyers. With mortgage rates dropping to an average of 4.6%, borrowing has become more accessible, prompting more buyers to enter the market. The combination of lower interest rates and increased inventory has created a more balanced environment, reducing the urgency and bidding wars that defined the market in earlier years.
The rental market has also played a role in shaping demand. With average rent for a one-bedroom condo reaching $2,750, many renters are now considering homeownership as a viable alternative, further driving demand in the condo and entry-level home segments.
A Buyer’s Experience: Moving from Renting to Owning
David and Melissa, a couple in their early 30s, had been renting a one-bedroom apartment in North York for $2,900 per month while saving for their first home. When interest rates dropped, they decided to take advantage of the improving market conditions and purchased a two-bedroom condo in Vaughan for $745,000. The mortgage payments on their new home now closely match what they were paying in rent, allowing them to build equity rather than continue renting.
Their experience reflects the increasing number of buyers who are making the transition from renting to owning, particularly as borrowing costs decline.
How Buyers Can Navigate the Current Market
For buyers, the increased inventory provides a greater selection of homes and the ability to negotiate better terms. With bidding wars becoming less frequent, buyers now have more time to make informed decisions. However, they must remain mindful of affordability, particularly in high-demand neighborhoods where prices remain elevated.
Suburban areas like Pickering, Ajax, and Milton continue to attract buyers looking for affordability and space. With detached homes in these areas priced below the GTA average, they offer strong long-term value for buyers seeking family-friendly neighborhoods.
Strategies for Sellers in a Changing Market
For sellers, the higher number of listings means more competition. To stand out, pricing competitively is essential. Homes that are priced according to market conditions and well-presented are more likely to attract serious buyers. Sellers should consider staging and minor upgrades, such as repainting and modernizing kitchens or bathrooms, to increase their property’s appeal.
In the condo market, where prices have softened, sellers may need to be flexible with negotiations, particularly for older units that compete with newer developments. Highlighting amenities, location, and rental income potential can make these properties more attractive to buyers.
What Lies Ahead for 2025?
Experts predict that the market will continue its moderate growth trend into early 2025. While demand remains strong, particularly for detached and semi-detached homes, price appreciation is expected to be gradual rather than dramatic. The Bank of Canada’s monetary policy will be a key factor in shaping market conditions, as further rate cuts could boost affordability and drive additional demand.
The condo market is expected to stabilize as increased rental demand supports investor interest, while the detached home market will continue to benefit from buyers seeking more space. Inventory levels will be a critical factor to watch—if supply continues to rise, buyers will maintain an advantage, but if listings slow, competition could return to the market.
A Market Steadying for Growth
The 3,359 home sales recorded in December 2024 reflect a real estate market that is stabilizing after years of volatility. With interest rates easing, inventory increasing, and buyer confidence improving, Toronto’s housing landscape is shifting toward a more balanced environment.
For buyers, this presents a unique opportunity to secure a home without the intense competition of previous years. For sellers, adapting to the changing market conditions by pricing strategically and presenting properties effectively will be key to achieving successful transactions. As Toronto moves into 2025, the city’s real estate market remains dynamic, offering opportunities for both buyers and sellers in a landscape that continues to evolve.
