The Ontario housing market has experienced significant shifts in recent years, influenced by economic, demographic, and policy factors. As we look ahead to 2025, it’s essential to understand the key trends and insights shaping the market.
This analysis will provide an in-depth look at the latest trends, data, and expert insights shaping the Ontario housing market outlook for 2025. We aim to paint a detailed picture of what buyers, sellers, and investors can expect to achieve the homeownership dream in the Canada Housing Market in the coming year.
Ontario Housing Market Snapshot
It is helpful to evaluate current conditions first to understand where Ontario’s housing market is headed in 2025.
Ontario Average Home Prices
According to the Ontario Real Estate Association, the average price of resale residential homes sold across the province in November 2024 was $868,067, up 4.7% from November 2023. The value of all home sales in the province was $11.9 billion.
Here’s a breakdown of the Ontario housing market by region:
| Region | Average Price | Year-over-year % change |
|---|---|---|
| Oakville-Milton, Greater Toronto | $1,122,162 | 2.4% |
| Cornwall, Kingston and Area, Ottawa, Renfrew County, Rideau-St. Lawrence | $613,295 | 4.1% |
| Bancroft & District, Barrie & District, Kawartha Lakes, Lakelands, Northumberland Hills, Peterborough and the Kawarthas, Quinte & District | $719,856 | 1.7% |
| Bancroft & District, Barrie & District, Kawartha Lakes, Lakelands, Northumberland Hills, Peterborough and the Kawarthas, Quinte & District | $398,598 | 13.8% |
| Brantford Region, Guelph & District, Hamilton-Burlington, Kitchener-Waterloo, Niagara Region, Simcoe, and Cambridge | $777,300 | 3.4% |
| Chatham-Kent, Grey Bruce Owen Sound, Huron Perth, London & St. Thomas, Sarnia-Lambton, Windsor-Essex, Woodstock-Ingersoll-Tillsonburg | $610,369 | 7.3% |
| Ontario | $868,067 | 4.7% |
Ontario home sales are expected to jump by almost 10% in 2025 due to pent-up demand from buyers waiting for more interest rate cuts, potentially leading to much stronger momentum beginning next spring or summer.
Ontario Residential Sales Activity
On a year-to-date basis, home sales totalled 163,344 units over the first 11 months of 2024, reflecting a modest gain of 3.3% from the same period in 2023. Nationally, home sales activity increased by 26% from year-ago levels in November 2024.
The Canadian Real Estate Association’s (CREA) sales and price forecast shows a more stable market next year after a sluggish 2023 and 2024. With a 9.9% sales increase forecast for 2025, sales will return to previous levels from a couple of years ago. Prices are expected to see a modest growth of 2.4%.
Ontario New Listings
The number of new listings on MLS Systems of real estate boards in Ontario increased by 1.9% from November 2023. There were 24,838 new residential listings in November 2024, the most significant number of new listings added in November in more than five years. New listings were 7.7% above the five-year average and 12.1% above the 10-year average for November.
Ontario Months of Inventory
Months of inventory numbered 4.1 at the end of November 2024, down from the 4.5 months recorded at the end of November 2023 and above the long-run average of 2.7 months. The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity.
Ontario Market Rents
The average rent in Ontario was $2,351 for November 2024, representing a 6.0% year-over-year decrease. Here’s a breakdown of the average rent by apartment type:
| Apartment Type | Average Rent | Year-over-year % change |
|---|---|---|
| Bachelor | $1,790 | -4.0% |
| 1-Bedroom | $2,143 | -6.0% |
| 2-Bedroom | $2,591 | -8.0% |
| 3-Bedroom | $2,143 | -8.0% |
What Factors Impacting Ontario Housing Market?
The Ontario housing market outlook for 2025 will depend on several key factors, including:
Higher Immigration Targets
With immigration targets rising, Ontario is expected to welcome over 200,000 newcomers in 2025. Strong population growth in major urban centers like Toronto will be a tailwind for housing demand.
Further Interest Rate Cuts
Economists predict the Bank of Canada will cut interest rates several more times in early 2025, bringing mortgage rates down and stimulating housing demand. Variable rates, in particular, could drop significantly.
Ongoing Supply Constraints
Despite rising construction, the supply of single-family homes is still constrained across Ontario, especially in cities like Toronto. Limited resale listings will stabilize prices in 2025.
Expansion of Rental Housing Stock
Tens of thousands of purpose-built rental units are slated for completion through 2025, giving tenants ample choice and preventing large rent increases.
How are the Housing Markets of Major Cities In Ontario?
Ontario is a large, diverse province, and homebuying patterns vary significantly by region based on local economic conditions and demographics.
Greater Toronto Area (GTA)
As Canada’s largest metropolitan area, the GTA benefits from a diverse economy, world-class amenities, and a vibrant cultural scene. In November 2024, the average home price in the GTA was up 2.2% year-over-year, reaching $1,106,050. The City of Toronto’s average home price is $1,080,167, up 2.8% year-over-year.
Ottawa
Ottawa’s stable government job market and high quality of life will continue to support housing demand in 2025. The city’s steady employment base and attractive amenities make it a desirable location for homebuyers.
In November 2024, the average home price in Ottawa was up 5.4% year-over-year, reaching $667,098. This strong performance is expected to persist, cementing Ottawa’s position as a key player in the Ontario housing market.
| Housing Type | Average Sold Price | YoY % change |
|---|---|---|
| Single-Family | $786,626 | 4% |
| Townhouse | $582,892 | 11% |
| Apartment | $422,570 | -5% |
Kitchener-Waterloo and London
The average home price in Kitchener-Waterloo is $754,604, down 0.4% year over year, while in London, it is $640,198, up 5.7% year over year. Both regions have experienced significant growth in their tech sectors, attracting young professionals and making them appealing to first-time buyers and investors.
| City | Housing Type | Average Sold Price | YoY % change |
|---|---|---|---|
| Kitchener-Waterloo | Detached | $862,690 | -3% |
| Semi-Detached | $643,672 | 4% | |
| Townhouse | $615,222 | 0.6% | |
| Condo Apartment | $452,732 | 0.5% | |
| London | Detached | $687,040 | 6% |
| Townhouse | $512,015 | 1.4% | |
| Condo Apartment | $333,235 | -10% |
Hamilton
The average home price in Hamilton is now $787,348, up 4.2% year over year, while Burlington saw prices increase 6.6% year over year to $1,096,136. These regions are popular among young families and retirees looking for a balance between urban amenities and a quieter lifestyle.
| Housing Type | Average Sold Price | YoY % change |
|---|---|---|
| Detached | $882,004 | 5% |
| Townhouse | $693,939 | 3% |
| Condo Apartment | $472,626 | 4% |
Explore Canada Housing Market 2025
Is Ontario in a buyer’s or seller’s market?
As of November 2024, the Ontario housing market is balanced, with a sales-to-new-listings ratio (SNLR) of 55%.
An SNLR between 40% and 60% is generally considered to indicate a balanced market, where there is a roughly equal number of buyers and sellers, and prices are stable. An SNLR below 40% suggests a buyer’s market, where there is an abundance of homes for sale relative to demand, giving buyers more negotiating power and potentially leading to price declines. Conversely, an SNLR above 60% indicates a seller’s market, with more buyers than available homes, leading to increased competition and upward pressure on prices.
With an SNLR of 55% in November 2024, Ontario’s housing market sits comfortably within the balanced range. This suggests that the market is not significantly favouring either buyers or sellers and that prices will likely remain relatively stable in the near term.
However, it’s important to note that the SNLR can vary considerably between different regions and housing types within Ontario. For example, while the overall market may be balanced, certain high-demand neighbourhoods or property types (such as detached homes) may still be experiencing seller’s market conditions.
| City | SNLR Nov 2024 | SNLR Oct 2024 | Market Type |
|---|---|---|---|
| Toronto | 51% | 43% | Balanced |
| Ottawa | 78% | 56% | Seller’s |
| Hamilton | 54% | 45% | Balanced |
| Kitchener-Waterloo | 61% | 53% | Seller’s |
| London | 56% | 48% | Balanced |
Looking ahead to 2025, CREA expects balanced market conditions to continue in Ontario, with supply and demand remaining relatively well-matched. However, this outlook is subject to change based on economic and policy developments, and local market conditions may continue to vary.
For buyers and sellers, understanding whether their local market is balanced, buyer-friendly, or seller-friendly can help inform their decisions around timing, pricing, and negotiation strategies.
Will Ontario Housing Market Crash in 2025?
According to most analysts, despite some expert warnings, a housing market crash is unlikely across Ontario in 2025.
Here are 3 reasons why a major correction is not anticipated next year:
- Rising Inventory Levels – Active listings jumped 19% year-over-year in November 2024, reducing the risk of a crash as supply increases.
- Ontario Benchmark Price Down Just 0.9% – Benchmark home prices fell less than 1% in November 2024, indicating stability, not a steep decline.
- Balanced Market Conditions – The sales-to-new-listings ratio shows neither buyers nor sellers have the upper hand. This balance reduces crash risk.
However, further price declines are possible, especially in overheated markets like Toronto, where values increased rapidly over the past decade. Overall, moderation rather than a crash is the consensus forecast for 2025.
Key takeaways
Key Predictions for Ontario’s Housing Market in 2025:
- Home sales to rise nearly 10% after subdued activity in 2023-2024
- Average home prices forecast to increase modestly by 2-3%
- Condo prices are likely to fall further as ample new supply is completed
- Rental rates are projected to drop due to high vacancy rates
- Ottawa, Hamilton, Kitchener-Waterloo to lead price growth
- Toronto and other overvalued markets face correction risk
- Balanced market conditions between buyers and sellers
The Ontario housing market is expected to stabilize in 2025, with modest price growth and increased sales activity. Factors such as interest rate cuts, economic recovery, immigration levels, and housing inventory will be crucial in shaping the market. While affordability remains a concern, the outlook for the Ontario housing market in 2025 is generally positive, with opportunities for both buyers and sellers.
At Bestmortgageonline.ca, we are committed to helping homebuyers and homeowners navigate the complexities of the Ontario housing market. Whether you are a first-time buyer or a seasoned investor, our team of mortgage professionals provides expert advice and guidance, ensuring you make informed decisions when buying or refinancing a home.
FAQs
How much will home prices change in Ontario in 2025?
According to projections from CREA, home prices in Ontario are forecast to increase by about 2-3% on average in 2025 after falling slightly in 2024. The pace of appreciation will likely be moderate.
Where are rental rates headed in Ontario in 2025?
With ample new supply being completed, rental rates will continue falling across most of Ontario in 2025 as vacancy rates remain elevated compared to historical norms.
Why are house prices forecast to rise more slowly in Ontario in 2025?
Moderating home price appreciation is expected as higher interest rates temper demand, immigration slows, and more supply comes online.
When will Ontario's housing market crash?
A housing crash is not anticipated in Ontario in 2025 as the market is fairly balanced between buyers and sellers. Further price declines are possible in overvalued markets like Toronto, but a crash is unlikely.
Can first-time home buyers afford houses in Ontario in 2025?
Despite slowing price growth, affordability will remain a challenge for Ontario first-time buyers in 2025 as higher interest rates keep mortgage payments elevated.
