Market Insight for June 6

Home sales in the Greater Toronto Area remained weak in May while inventory levels were up — giving more negotiating power to potential homebuyers.

The Toronto Regional Real Estate Board stated in a release this week that 6,244 homes were sold in May, down over 13 per cent compared to the same month last year. It was the lowest May sales figure since 2002, excluding May 2020 when the pandemic lockdowns had just begun.

Back in 2002, both the housing stock and population were much smaller, with the city’s population having grown by more than 35 per cent over the past two decades.

Still, the report noted that, on a seasonally adjusted basis, both sales and prices posted a slight increase compared to April, with May marking the second straight month of rising sales. At the same time, new listings totalled 21,819 — up 14 per cent year-over-year.

“Homeownership costs are more manageable this year compared to last. Average sale prices have declined, and borrowing expenses are also slightly lower,” said Jason Mercer, TRREB’s chief information officer, in the statement. “If everything else stays the same, we would expect higher sales activity compared to 2024.”

Spring is normally a peak season in real estate, but unease over trade tensions with the U.S. has dampened demand and weakened consumer confidence. Ongoing global trade disruptions stemming from the U.S. tariff strategy have weighed on consumer sentiment in recent months, influencing home-buying decisions.

Once households believe there will be stable trade relations with the U.S. — or viable ways to reduce economic dependence on the U.S. — home sales are likely to recover. The average GTA sale price dropped four per cent compared to the same time last year, landing at $1,120,879.

Last month’s drop in Greater Toronto home sales followed the pattern seen in other major Canadian cities. In Vancouver, sales of residential properties fell 18.5 per cent year-over-year in May. In Calgary, the decline was 17 per cent.

Within the City of Toronto, 2,315 homes changed hands in May — a decrease of about 15 per cent from May 2024. The average price for a home was $1,155,616.

Condos saw the steepest drop in sales activity, down 25.1 per cent, followed by a10.6 per cent decline in detached homes and a 9.8 per cent dip in townhouse sales.

Among home types in Toronto, semi-detached properties experienced the largest price drop, falling 8.4 per cent year-over-year. Condos followed with a 7.3 per cent decline, and detached homes were down 5.6 per cent.