Toronto home sales continue to chill in March over tariff uncertainty

Deep uncertainty over tariffs and trade wars continues to plague the Greater Toronto Area housing market, as sales plunged both on an annual and monthly basis, plumbing a new low for March activity.

A total of 5,011 homes traded hands over the course of the month, according to the Toronto Regional Real Estate Board (TRREB), marking a -23.1% decline from the previous year. While that’s actually 24.1% higher than the 4,037 sales reported in February, transactions fell on a monthly basis with seasonal adjustment taken into account, says the real estate board.

Sellers, however, continue to be active, heaping new supply onto the market; a total of 17,263 properties were listed in March, up 28.6% year over year and 43% compared to February. Overall, there were 3,926 more homes available for sale at the end of March compared to the previous month, at a total of 23,462 active listings (up a whopping 88.8% from March 2024).

“Given the current trade uncertainty and the upcoming federal election, many households are likely taking a wait-and-see approach to home buying. If trade issues are solved or public policy choices help mitigate the impact of tariffs, home sales will likely increase. Home buyers need to feel their employment situation is solid before committing to monthly mortgage payments over the long term,” said TRREB’s Chief Information Officer Jason Mercer.

Lower rates improve affordability for Toronto home buyers

Despite this, there hasn’t been any kind of significant correction in terms of home prices; they have remained fairly sticky, dipping just -2.5% compared to last year, at an average of $1,093,254, also marking an 0.8% uptick from February. However, that slight decrease, combined with dropping mortgage rates, have started to move the affordability dial for buyers in the region, according to Toronto Regional Real Estate Board (TRREB) President Elechia Barry-Sproule. 

“Homeownership has become more affordable over the past 12 months, and we expect further rate cuts this spring,” he stated in TRREB’s release. “Buyers will also benefit from increased choice, giving them greater negotiating power. Once consumers feel confident in the economy and their job security, home buying activity should improve.”

Also read: Dropping mortgage rates made it easier to buy a home in February

Sales dropped across all home types

Source: Toronto Regional Real Estate Board

Sales were down on an annual basis across all home types. In terms of volume, single-detached homes sold the most, with 2,155 units, down -24.9% year-over-year. The average price, however, inched down just -1.8% on an annual basis to $1,439,268. In the City of Toronto specifically, detached home prices actually increased by 1.1% to $1,723,489, though sales still slumped by 10.8%. Activity was most hammered in the 905-region markets, with sales for detached houses down by -28.9%, and average price by -4.3% to $1,336,568.

Condo sales have sustained deep declines in recent months, as investors look to sell off their units amid higher interest rates and stagnant rents. Unit sales fell further, down -23.5% as a whole. The average price for a unit softened by -2.6% to $682,019. Sales declines were significant across the region, down -21.6% in the City of Toronto, and -27% in the 905 area regions. The averaged price decreased by a lesser extent in the city, by -1.8% to $716,460, but more steeply in the 905 by -5%, to $615,086.

City of Toronto prices holding firm compared to the 905

Source: Toronto Regional Real Estate Board

Home sales plunged by -16.8% within the City of Toronto, with a total of 1,908 homes trading hands. Prices, however, stayed stable, ticking up 2.3% compared to the same time period in 2024, to an average of $1,110,924. This was despite a slew of newly-listed homes hitting the market, at 6,421 properties, a year-over-year increase of 28.5%.

Transactions fell by a larger degree in the surrounding 905-area markets, down -26.5% annually with a total of 3,103 transactions. Combined with a 28.5% increase in new listings (a total of 10,842 homes hit the market), that effectively chilled the average home price by -5.1%, to $1,082,389.

Tariffs continue to cloud mortgage rate outlook

While TRREB expresses optimism that borrowing costs will continue to lower, the interest rate outlook remains uncertain. Ongoing tariff threats continue to cause upheaval in global markets; they experienced a massive selloff in the days following U.S. President Trump’s April 2nd announcement that the States would slap “reciprocal” 50% tariffs on a number of other nations. While Canada was largely spared this most recent round of tariffs, our economy will still feel the brunt of global trade challenges, especially as conditions slow for our trading partners, and prices rise.

In fact, 32% of Canadian businesses expect poorer economic conditions this year, according to the Business Outlook Survey findings released this week by the Bank of Canada. That’s a hefty increase from the previous 15% recorded in the previous six months. Consumers, meanwhile, are even more pessimistic about the economy, with 67% calling for a recession in 2025, up from 47% in the previous quarterly survey.

Growing recession fears would usually prompt the Bank of Canada to cut its trend-setting Overnight Lending Rate – which sets the pricing for lenders’ prime rates and, by extension, variable mortgage rates – but rising inflation as a result of tariffs could also dissuade policy makers from adding too much stimulus, too quickly. While the odds of another 25% rate cut from the BoC in its next announcement on April 16 are increasing, the central bank has made it clear that it’s watching how conditions change in real time, and will react as needed.

Also read:

• How would US tariffs impact Canadian mortgage rates?
• Tariff uncertainty takes a bite out of February Toronto home sales
• Dropping mortgage rates made it easier to buy a home in February
• Canadian home sales plunge 10% in February due to tariff fears
• What is the Bank of Canada Overnight Lending Rate?
• What is the Prime Rate?