Market Insight for May 2

With average home prices in the GTA slightly lower than last year, Toronto’s housing market continues to favour buyers. Although roughly 75% of GTA neighbourhoods see homes sell below asking, there are still select pockets where properties consistently fetch above-list prices.

According to experts, this trend is largely driven by location and relative affordability. Charming semi-detached and fully detached homes in the five most overbid neighbourhoods—Little Italy, Davenport, St. Clair West, The Danforth, and The Junction—remain attractively priced between $1.3 million and $1.8 million. These areas also offer strong appeal thanks to proximity to top-rated schools, transit options, vibrant dining scenes, nightlife, and local amenities.

These well-connected neighbourhoods remain highly urban and sought-after. Due to continued strong demand in this price bracket, many sellers are strategically listing their homes to spark bidding wars. As a result, pricing below market value has become a tactic to encourage multiple competing offers.

Conversely, high-end areas such as Lawrence Park and Forest Hill have been noted as the most underbid. While prospective buyers remain interested in affordable urban neighbourhoods that can offer more traditional homes with a backyard, current market activity is lower than what people were expecting before uncertainty with the United States and tariffs began.

Everybody was expecting that this spring was going to be a very boisterous market. There are still sales happening, but it’s more of a lukewarm market. Purchasing a home and committing to a 25- to 30-year mortgage is essentially “a bet on the future.” People are hesitant to make such long-term commitments when they’re uncertain about political developments, potential job loss, or what their earnings might look like in the near future. Sellers share that apprehension; many question whether now is the right time to put their property on the market.

Although many would-be buyers have put their home searches on hold, the inventory of resale properties continues to grow.

Across communities in Ontario’s Greater Golden Horseshoe, real estate agents report that move-up buyers are rare and first-time buyers are proceeding with caution.

The Hamilton and Durham real estate markets are facing headwinds due to uncertainty surrounding US tariffs, impacting the auto industry and broader economic activity. This uncertainty is causing a slowdown in sales and potentially softening prices, especially in areas heavily reliant on exports to the US.