Toronto Real Estate Market Update: October 2025 Trends & Insights

The market continues to show signs of improvement despite a decline in year-over-year sales. Because sales surged more than 40% in October last year—driven by the Bank of Canada’s aggressive rate cuts and occurring before the U.S. election—it’s not surprising that activity moderated annually this October. Even so, demand kept pace with seasonal trends, and market conditions were the tightest they’ve been all year, helping keep prices relatively stable compared to recent months.

Total MLS® sales fell 10% year-over-year to 6,138 transactions, following three months of annual growth, largely because last October saw an unusual 41% jump triggered by a 50-basis-point rate cut. Still, sales rose 10% month-over-month, aligning with normal seasonal patterns, making this the second-strongest October in the past four years. Sales sat 22% below the 10-year average—an improvement from September (24% below) and August (30% below).

New listings grew just 3% annually, marking the slowest pace in a year. With 16,069 homes coming to market, October reached the highest new-listing count since 2020 and sat 9% above the 10-year average. Active listings dipped 5% from September but remained 17% higher than a year ago and reached their highest October level since 2008.

Market conditions continued to tighten as the sales-to-new-listings ratio climbed to 38%, the highest level this year, although still below the 43% seen last October and the 10-year average of 54%. Months of inventory fell to 4.5—dropping below five months for the first time in six months and reaching the lowest level since January.

Prices remained lower than last year but stable month-over-month. The average selling price declined 7.2% annually, marking the ninth consecutive month of year-over-year declines and the largest drop since April 2023. Meanwhile, the MLS® Home Price Index fell 5% annually and stayed flat compared to September. At $1,054,372, the average selling price is still 8.6% higher than five years ago, reflecting a 10-year average annual growth rate of 5.7%.

Sales for semi-detached, row, and townhomes held up better than other segments in October. Detached home sales and condo apartment sales both declined 11% year-over-year, while sales for semis, rows, and towns fell a more modest 7%. Compared to 10-year averages, condo apartment sales were the farthest below typical levels at -25%, followed by detached homes at -22% and semis/rows/towns at -19%.

Active condo listings reached their highest October level on record, but they also fell to a six-month low and grew at their slowest pace in 28 months. Over the past year, active inventory increased fastest for detached homes (+24%) and slowest for condos (+6%), reflecting a gradual cooldown in condo supply growth.

Months of supply continued to shift across segments. Condo apartments sat at 5.7 months of supply—above last year’s 4.8 but marking an 11-month low. Detached homes reached 4.5 months of supply, a nine-month low but still higher than the 3.2 months recorded last year. Semis, rows, and towns maintained the lowest months of supply at 3.5, a seven-month low but also above last year’s 2.7.

Condo prices declined 4.7% year-over-year in October, marking the 10th consecutive annual decrease. Even so, the average condo price rose to a four-month high at $660,208. Annual price declines were steeper for detached homes and semis/rows/towns, both of which fell 7% compared to last year. Looking further back, average prices are still up compared to five years ago: +13% for semis/rows/towns, +12% for detached homes, and +6% for condo apartments.

Month-over-month sales growth was strongest for low-rise homes priced under $600K, which saw a 30% jump. Low-rise properties priced between $1.75M and $1.99M also posted strong monthly gains at +21%. In the condo segment, the fastest-growing price band was $800K–$899K, where sales increased 36% month-over-month, followed by the under-$500K category at +17%.

On an annual basis, sales increased for low-rise homes priced under $800K and condo apartments priced under $500K. All other price ranges posted year-over-year declines, with the sharpest drop occurring among condos priced $700K–$799K (-38%). Meanwhile, low-rise homes under $600K recorded the strongest annual increase at +76%.

Within the City of Toronto, low-rise supply was lowest in Toronto East. Detached sales dropped the most in Toronto Central (-23%), pushing average prices down 13% and raising supply levels to 6.0 months. In Toronto West, detached sales fell only 4% and average prices rose 5%, with supply sitting at a tighter 3.4 months. Toronto East recorded the tightest conditions, with detached supply at just 2.9 months and semis/rows/towns at 2.2 months following a 40% surge in sales.

The Toronto condo market continues to outperform the 905 region. Condo sales in the City declined 8% year-over-year—better than the 17% drop seen in the 905. Average prices in Toronto fell 3%, compared to a 10% decline in the 905. Toronto condos also had a tighter supply at 5.4 months, a full month lower than in the surrounding region.

Key Takeaways

The October results were stronger than media headlines suggested. Given last year’s unusually high activity, it would have been surprising to see sales surpass those levels. Instead, sales reached a four-month high, confirming that the slow and steady recovery that began in April remains intact.

On October 29th, the Bank of Canada reduced its policy rate to 2.25%, marking a second consecutive 25-basis-point cut after holding at 2.75% since March. Compared to a year ago, the policy rate is now 1.50 percentage points lower.

Affordability has improved meaningfully over the past year due to falling interest rates, lower prices, and more flexible mortgage insurance rules—including 30-year amortizations and down payments below 20% for homes up to $1.5M. Despite these improvements, buyer sentiment remains cautious. Economic uncertainty, a slowing economy, and the ongoing trade dispute with the U.S. continue to weigh on consumer confidence. Although there is considerable pent-up demand, many buyers remain concerned that prices could fall further.

However, multiple indicators suggest that prices are at, or very close to, their bottom. Seasonally adjusted prices have been flat for six consecutive months, and market balance metrics—such as the sales-to-new-listings ratio and months of supply—have tightened. While inventory levels remain elevated and conditions still favour buyers, the fact that the correction is now in its fifth year and prices have fallen a cumulative 21% from peak levels aligns with past market cycles that typically precede recovery phases.

With the Bank of Canada suggesting rates are now “about the right level,” expectations for further cuts have softened. Markets currently assign only a 5% probability to a rate drop at the next meeting on December 10, and many economists believe the Bank could stay on hold through 2026 as inflation and the broader economy show resilience. Still, the outlook remains highly uncertain, and policymakers continue to monitor incoming data closely.

Despite the overall softness, several market segments continue to demonstrate stability. Low-rise homes priced under $1.5M within the City of Toronto have less than three months of supply, suggesting upward price pressure may emerge. Additionally, the condo apartment market—particularly in Toronto—is beginning to find its footing as new completions trend lower.