The Review · Vol 10/25 · September 2025
Maybe... just maybe... the market's waking up
Written by Pawel Parafianowicz, Founder | Broker, Coral Realty Group ·
There is finally a shift in the air. September wrapped up with encouraging signs of renewed activity. Showings have picked up, more buyers are reaching out, and the overall energy in the market feels more positive than it has in months. While the broader numbers still show a slower market, on the ground we are starting to see the first signs of momentum returning as buyers re-enter with more confidence.
As we mentioned in our last update, much of the unsold inventory from the spring market came back in September, making it the second-highest month for new listings this year. We do not expect a large wave of additional listings through the rest of 2025. Most sellers hoping to capture fall buyers have likely already listed, leaving October and November relatively quiet on that front.
Sales activity in September was solid, marking the strongest numbers for the month of September we have seen since the 2021 peak. Prices remain down roughly ten percent from last year, but interest rates have eased and affordability has improved compared to 2022 and 2023. The combination of lower prices and lower borrowing costs is setting the stage for a stronger start to 2026.
The numbers tell us where we have been, but experience tells us where we are going. In our thoughts below, we share what we are seeing now that could shape the months ahead.
Buyer's or seller's market?
5.2 months of inventory: an extreme buyer's market.
- Seller's under 2
- Balanced 2–3.5
- Buyer's 3.5–5
- Extreme buyer's 5+
Every September, months of inventory
October highlights
- 01Affordability is quietly improving Average prices are down roughly 10% year-over-year (YoY), condos down 16% (YoY), interest rates have eased, and more cuts are expected. Compared to 2022 - 2024, affordability has improved meaningfully, especially for first-time buyers.
- 02Spring’s leftovers flooded back in Much of the unsold spring inventory returned in September, giving us the second-highest number of new listings this year. It boosted choice for buyers, but it also means sellers need to stand out with strong presentation and realistic pricing.
- 03All eyes on early 2026 Sellers should target the January to March window, when confidence improves and competition is still low. The smart move? Sell early, buy smart, and stay alert for potential market swings tied to the upcoming CUSMA renewal.
- 04CUSMA: the 2026 wild card Canada’s trade deal with the U.S. and Mexico expires in June 2026, and about 85 percent of Canadian exports currently move tariff free under it. If the agreement is not renewed, tariffs could apply to everything and shake the economy. With Trump likely to push for tougher terms, Canada could be strong armed at the negotiating table, making this a key factor to watch heading into 2026.
- 05Canada’s real estate bubble is unraveling According to BMO, the housing bubble has already burst, and Canada is now living through the fallout. Prices have been sliding since 2022 and could take years to recover. The bank compares today’s correction to the U.S. housing crash in 2007 and Ontario’s 1990s downturn, warning it is nearly impossible to recreate the perfect storm of low rates, pandemic migration, and peak Millennial demand that fueled the boom.
Average price
The Average Home Price increased on a month-over-month basis for the first time since July, rising from $992,085 in August to $1,089,918 in September, a 9.9% gain. As noted in last month’s report, the August figure of $992,085 was the lowest August average since 2019, marking a temporary soft spot in the market. While this rebound is a good indicator of market direction, the Home Price Index (HPI) offers a more accurate reflection of how values have shifted. According to the HPI (see below), prices are down 10.85% year-over-year, which better represents actual price movements in the market. Condo values have been hit particularly hard, with the HPI showing a 16% year-over-year decline, underscoring the continued pressure in that segment despite short-term fluctuations in the overall average price.
Average price
$1,089,918 ▼ −2.1% vs a year earlier ($1,113,671)
- 2025
- 2024
- 2023
Average price by type
HPI
The Home Price Index provides an apples-to-apples comparison of home prices in the city, filtering out distortions that can occur when a single month has an unusually high or low number of luxury sales. It reflects a more accurate measure of how prices have actually changed. According to this metric, Toronto home prices are down 10.02% year-over-year, with detached homes down 9.39%, semi-detached homes down 8.02%, and condos down 14.39%.
MLS® Home Price Index
Sales
Sales activity offered an interesting development last month that could signal renewed momentum in the market or simply represent an outlier. After 1,779 properties changed hands in August, 2,063 homes sold in September, marking a 15.96% month-over-month increase. For context, the same period in 2024 saw a modest 5.24 percent gain, while both 2022 and 2023 recorded declines in sales between August and September. This 15.96% jump is the largest August-to-September increase since 2019, which makes it worth watching closely to see if it marks the beginning of a trend rather than a one-off anomaly. On a year-over-year basis, September’s 2,063 sales were 14.1% higher than the 1,808 sales recorded in September 2024. Still, activity remains well below pre-pandemic levels, when September typically saw between 2,500 and 3,500 transactions.
Sales by type
New listings
New listings typically rise from August to September, so it comes as no surprise that the 4,538 new listings recorded in August climbed to 7,182 in September, representing a 58.3% increase. This surge made last month the second-highest September for new listings on record, trailing only the 8,689 listings seen in September 2020.
On a year-over-year basis, the numbers were much closer. The 7,074 properties listed in September 2024 compared to 7,182 last month represent a 1.5% increase. That is a sharp slowdown from the 8.64% year-over-year increase recorded in August, suggesting that while listings continue to rise, the pace of growth is starting to ease.
New listings by type
Active listings
Active Listings increased on a month-over-month basis, rising from 9,644 in August to 10,653 in September, a 10.5 percent increase. This brought the total just shy of the 11,000 mark that has been an important benchmark throughout 2025 and that was surpassed in both May and June.
As expected, the year-over-year figures were much higher. There were 10,022 active listings at the end of September 2024, meaning active inventory is up 6.3 percent compared to last year. Similar to the trend seen with new listings, the year-over-year growth rate has been slowing, which may either point to a market beginning to stabilize or simply reflect when the downward shift took hold last year.
Homes for sale by type
The bigger picture
Homes sold every September, 1996 to 2025
Average condo apartment price, by year
Condo prices are back near 2021 levels.
Our thoughts
From our position working directly with buyers, we are noticing a steady increase in interest and early activity. Many are browsing casually right now, attending open houses, getting pre-approvals, and watching how prices move before committing. This familiarization period is a key part of the buying process, and it often takes a few months before these early-stage buyers feel ready to make an offer. That is why the uptick in inquiries we are seeing today tends to translate into stronger sales activity for the spring market.
Sellers, pay attention. If you are considering listing, your goal should be to be among the first out the door. Currently, the optimal window looks to be January through March at the latest. By that time, we expect more positive economic headlines, further rate cuts, and stronger portfolios for many Canadians, particularly those holding tech-heavy investments.
There is, however, one major factor to keep in mind, the upcoming CUSMA renewal. For those unfamiliar, CUSMA is the trade agreement that replaced NAFTA, negotiated during President Trump’s first term. It is set to expire in June 2026, and there is growing concern that Trump may attempt to strong-arm Canada. At present, 85 percent of Canada’s exports to the United States are exempt from the 35% tariffs because they fall under CUSMA. If that exemption were removed, it could send shockwaves through both financial markets and real estate.
We remain hopeful that a new deal will be reached in time, but sellers should plan ahead. If you intend to sell in the next year, the early spring window is critical. Preparation should begin this November or December to be ready to list at the start of the year.
Reach out to us if you are planning ahead. We can help you prepare your property and strategy to ensure you are well-positioned before the next market shift.
Buyers → Affordability has improved noticeably as prices and interest rates have both come down, with further rate cuts expected. Condo prices in particular have dropped sharply, creating solid opportunities for entry-level buyers and investors.
For first-time buyers, the market is likely near its lowest point. If you plan to stay three years or more, now is a good time to buy rather than trying to time the absolute bottom.
For those planning to sell and buy, aim to list early in 2026 (January to March) and look to purchase during potential market turbulence later in the year if CUSMA negotiations trigger uncertainty. While politics can be unpredictable, that period could offer short-term buying opportunities. Listing early also positions you to sell higher before more unsold inventory returns to the market in spring.
Sellers → For sellers, the January to March 2026 window will be the ideal time to list. By then, buyer confidence should strengthen with improving affordability and further rate cuts. In today’s market, it is smart to sell before you buy to avoid complications. Presentation matters, even small improvements can help your property stand out. Work with an experienced agent who understands this market, as expertise will make all the difference.
Investors → We have started noticing a shift in the investment space. Fixer-uppers that had been sitting for months are now getting scooped up quickly at attractive prices. It may be a small sample size, but we have picked up on these cues before, and they often prove to be early signals of changing investor sentiment.
Focus on value-add properties, homes with potential for basement apartments, secondary suites, extensions, or laneway and garden homes. These types of properties allow you to force appreciation and build cash flow, even in a slower market.
We send out a weekly email featuring standout investment opportunities currently on the market. If you would like to receive it, reply to this email to be added to our “Weekly Investor Hotlist.”
Source: TRREB. Figures as published in September 2025's data, sent October 17, 2025. Market commentary is general information, not advice for your situation.