Toronto real estate continues to defy all odds, but this time it’s to the downside. Toronto Regional Real Estate Board (TRREB) data shows prices fell further in January, extending a crash that now rivals the largest in the country’s history. Sales are still weak, as the investor-dominated market remains out of reach for end-users. The combination helped inventory reach a high for the month, with an epic inflow of supply still in the pipeline for this year.
Toronto Real Estate Price Crash Approaching The Largest In History
The benchmark price of a typical home across Greater Toronto.
Source: CREA; TRREB; Better Dwelling
The price of a typical home across Greater Toronto dropped 0.7% (-$6.2k) to $936,100 in January, 8.0% (-$81.0k) lower than this time last year. Prices haven’t posted annual growth in nearly two years, and now sit at roughly the same level they did in 2021—marking a half-decade of zero progress.
Peak buyers wish they were that lucky. The composite benchmark has cratered 27.0% (-$345.8k) since the February 2022 peak, though still 17.0% (+$135.8k) above 2020 levels. This highlights just how fast prices climbed: After a correction that’s less than a point from being the largest in Canadian history, home prices still beat inflation.
At this level, they’re still out of reach for end-user budgets—a problem that’s showing up in demand. The lack of demand, that is.
Toronto Home Sales Fall, Inventory Hits A New High
Greater Toronto existing home sales vs new listings: January.
Source: CREA; TRREB; Better Dwelling.
Existing-home sales remain at one of the weakest levels in Toronto’s history. TRREB data shows sales came in 19.3% lower than last year, with just 3.1k units sold in January. Not quite as bad as new condo sales, but it was still the worst volume for the month since 2009. The population in Greater Toronto grew 30% (+1.7 million people), but existing homes remain at the same level. Ouch.
January isn’t typically busy, but sellers appear to be facing a sense of urgency. New listings were 13.3% lower than last year at 10.8k homes in January, but still the third-most for the month. At more than 3x the volume of sales, the sales-to-new listings ratio (SNLR) was only ~29%. At this level, the market is firmly in a buyer’s market, where prices typically fall.
The supply-demand mismatch is helping inventory make an aggressive climb. Last month ended with 18,900 active listings, up 8.% from last year, setting a new January record.
Toronto real estate made a dramatic shift. Just a few years ago, investors sent the market soaring, pricing end users out. Now that investors are facing losses, demand has completely disappeared.
Investors are hesitant to catch a falling knife, and end-users are still priced out of the market. With a wave of incoming inventory, the odds look stacked in favour of a weaker demand balance before it improves.
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