The average price of a GTA home has returned to 2021 levels and there may be more market weakness ahead: TRREB

For the first time in five years, the average house price in Toronto has dropped below one million dollars.

TORONTO — Greater Toronto Area home sales and price weakness is likely to persist for at least the first half of the year, the region’s real estate board said Wednesday.

The outlook came as the Toronto Regional Real Estate Board said home sales for January fell 19.3 per cent from a year earlier to 3,082 sales. The average selling price dropped 6.5 per cent to $973,289, falling below the $1 million mark for the first time since January 2021.

New listings were down from a year earlier, but active listings were up 8.1 per cent to 17,975. Average listing days on the market rose 21.6 per cent to 45 days.

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The elevated supply will likely lead to lower average selling prices in the first half of 2026, though prices could stabilize in the latter half if consumer confidence improves, said TRREB.

“The housing market reflects the tension many households are feeling as we look ahead to 2026,” said board president Daniel Steinfeld in a news release.

“Greater economic clarity in the months ahead could restore confidence and help unlock demand that has been building for several years.”

An Ipsos survey released by TRREB found 22 per cent of respondents in the Greater Toronto Area said they were likely to buy a home in the next year, down from 27 per cent in 2025.

The TRREB outlook noted that while affordability had improved as both interest rates and home prices were down, many households will be less likely to commit to buying until Canada’s economic situation becomes less precarious.

The trade relationship with the United States is a key driver of uncertainty as U.S. President Donald Trump continues to threaten new tariffs on Canadian products, with a formal review of the trade agreement between Canada, the United States and Mexico set for July.

Population growth in the GTA is also a significant factor for the housing market, and another source of pressure recently.

Statistics Canada reported that the country’s population fell in the third quarter of 2025, with Ontario seeing the largest drop of any province.

TRREB said a pullback in temporary student permits in Ontario, leading to a net loss of over 100,000 non-permanent residents in the third quarter, impacted the GTA rental market, but the long-term outlook for population growth in the region continues to be positive.

But while some of the January statistics look discouraging, there are still signs of increased interest in areas like the Toronto core, said Cailey Heaps, president of the Heaps Estrin Real Estate Team.

“There’s definitely been a decrease in volume, and it does feel like the market is still under pressure, but we are seeing multiple offers again in the first time buyer segment,” she said in an interview.

She said the new year often brings renewed interest after the down period around the holidays, and more buyers are taking note of the price declines that have already happened in the market.

“We’re definitely still feeling pain in the marketplace, but I think that buyers have come to recognize the current position of the market,” said Heaps.

“I would feel anecdotally that buyers are feeling better about it, while sellers might be feeling less confident about listing.”

The average detached home price in the GTA was down 7.4 per cent in January to $1,277,915. The average condominium price was down 9.8 per cent to $604,759.

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Affordability has improved not only as prices retreat but also as the Bank of Canada has lowered interest rates. The central bank lowered its policy rate to 2.25 per cent in October, having started 2025 at 3.25 per cent.

Interest rates, however, are coming up less as a factor in conversations, possibly from fatigue around the subject despite its importance to affordability, Heaps said.

Instead the biggest factors holding back buyers seem to be either timing the market, which is very difficult, and the geopolitical uncertainty, she said.

“There’s also just people who are worried about the broader geopolitical ... uncertainty in the world, who want more comfort around the direction where things are heading before they invest.”

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Ian Bickis, The Canadian Press

This report by The Canadian Press was first published Feb. 4, 2026.