GTA homebuyers continued to wait on the sidelines last month with a new report suggesting home sales fell nearly eight per cent compared to the same time last year, as experts cite uncertainty around inflation and borrowing costs. The latest figures from the Toronto Regional Real Estate Board (TRREB) show 5,603 homes changed hands across the GTA last month, down 7.9 per cent from October 2025. New listings also declined, falling 11.9 per cent year over year to 14,173. The report comes as Canadians contend with rising borrowing costs following the Bank of Canada’s decision to raise its benchmark interest rate by 25 basis points to 2.5 per cent, its first increase since July 2023. The central bank is attempting to contain inflation, which currently sits at 3.1 per cent, amid concerns that higher fuel prices could push costs further up across the economy. ‘Sitting on the sidelines’ Jason Mercer, TRREB’s chief information officer, says the uncertainty surrounding the economic outlook has created a market where prospective buyers and sellers are increasingly reluctant to make major financial decisions. “You essentially have both buyers and sellers sitting on the sidelines right now, waiting to see how things shake out with the economy, inflation and borrowing costs,” Mercer told CP24 Breakfast. “We’ve been feeling the impact of would-be rate hikes for two or three months now,” he added. The average selling price of a GTA home was $1,024,108 in October, down 2.7 per cent compared to a year earlier. The MLS Home Price Index composite benchmark also declined 4.3 per cent year over year. Despite the continued price declines, Mercer says buyers have benefited from having more properties to choose from and greater negotiating power when making offers. “We have seen a better supply market, and more negotiating power for buyers, and that’s helped with affordability,” he said. “New listings have actually been down more so than sales on a year-over-year basis,” Mercer said. On a seasonally adjusted basis, the report also notes that both home sales and new listings increased month over month compared to September. However, Mercer also cautioned against interpreting the latest figures as a sign that housing affordability has returned to pre-pandemic levels, noting that average selling prices remain considerably lower than the highs recorded during the pandemic-era housing boom. “We’re still off quite a bit from where we were coming out of the pandemic, and I think that has helped a lot of households mitigate the impact of higher borrowing costs,” he said. Still, he says prospective buyers who are waiting for more favourable conditions could remain on the sidelines until there is greater clarity around the economy. “If you can’t get the price point you’re looking for to sell your home and move around in the market as your situation dictates, you’re just gonna put that decision on hold,” Mercer said. Looking ahead, Mercer expects November and December to bring the usual seasonal slowdown in real estate activity, describing them as the usual “slower months of the year.” Looking ahead into next year, he says developments on the trade front, a resolution to the conflict in the Middle East and signs of easing inflation could help restore consumer confidence. “If we start to absorb that inventory, we’re going to need new home types coming down the pipeline,” he said, adding that there is still a need for more housing types. “This greater diversity, this ‘missing middle,’ allows people to more easily move up and down the housing continuum as their situation dictates,” he said. He added that policies encouraging more housing construction and a greater diversity of home types will be important as the GTA’s population continues to grow. “The population, the permanent population, in the GTA, and certainly drilling down to the city of Toronto, continues to grow, and all those people require a place to live,” Mercer said.
