Should You Buy a Toronto Condo in 2025?

Mr. Asgarian, when should we finally buy a condo? I get this question all day long. My phone rings from morning to night with clients asking the same thing, so let me set the record straight and give you my read on the Toronto condo market in 2025.

I am Moe Asgarian, Principal Real Estate Broker in Toronto and ranked number 47 worldwide at RE/MAX. The condo market is soft right now, with a lot of unsold inventory, and average condo prices have drifted down since 2022. The real question is where that slide stops and when it turns. So let me walk you through the five things that could push Toronto condos back up. They do not all have to happen at once.

One: inventory has to drop

Right now there are too many condos on the market, and that supply is pressing on prices and keeping them from rising. For condos to climb, months of inventory needs to roughly cut in half, from the 5 to 6 months we see now down to under 2. Any time you see months of inventory sitting under 2 for several months in a row, that is when prices start moving up. It is not far-fetched. Owners may keep pricing sensibly and drawing buyers back until the market tightens on its own.

Two: the gap with freehold gets too wide

Since about 2019, the average price gap between a condo and a freehold home has run around 30 percent. Now picture that gap stretching to something extreme, say 80 percent. People would look at freehold, decide it is simply too expensive, and send their money toward condos instead. So the spread itself can be a driver. Either freehold gets so pricey that a large condo makes more sense, or condo prices fall so far that buying the cheaper condo is the obvious call.

Three: renting stops being the easy choice

People rent partly because renting is cheaper than carrying a home. They can often cover the down payment, but the math on maintenance fees, taxes, and everything else that comes with ownership pushes them to keep renting. Now imagine families realizing that owning is not that different from renting anymore. With this economy and rates easing, the cost of owning is slowly coming down. Rates are still well above where they were a few years ago, but when that gap narrows, more renters start thinking about buying.

Four: construction slows down

Every year a huge number of new condos hit the market. Something like 40, 45, even 50 thousand new units are set to be built and delivered across the GTA by the end of this year. So in the next few months this oversupply is not getting solved. But look a little further out. Many projects that were supposed to deliver from 2027 onward have stopped. I heard one figure that in 2028 the number of new units could be around 4,000. Do the quick math: 45 to 50 thousand today versus 4,000 later. That is a big drop in supply coming.

Five: rate cuts

This one everyone knows. Lower rates can directly push condo prices up. Just remember that rates are coming down because the economy is weak, so do not expect the cuts alone to heat the market up fast, since people have less money to spend and invest. So there is the answer to what makes condos go up. Honestly I am still not sure whether 2025 or 2026 is the better year to buy. Prices could keep sliding into 2026. But the market I see points to 2027 and very likely 2028 as the years prices climb, and that is when whoever bought earlier makes the bigger gain.

Stop trying to time the bottom

Here is the truth: none of us can time the market. In no market can you say today is the exact bottom and buy right there. Usually by the time the news says the market was great, prices have already gone up, and that is when people rush in. Look at Bitcoin. For years it sat low, then the moment it climbed everyone was told to buy, and some bought near the top just before it fell. A good buyer does not wait for prices to rise. Buy when prices are low, buy a solid healthy home, and offer the price you believe is fair. Real estate is a long game with high transaction costs, so look at a 4 or 5 year horizon, not one or two years. If you want a quick one or two year flip, real estate is not the right market for that.

I hope these points help you make a better purchase. If you want to talk it through, fill out the form at the bottom of this page or book a free consultation and let's get to know each other. Stay well and take care.