GTA New-Home Sales Hit Historic 45-Year Low in 2025
Sales of new homes in the Greater Toronto Area have plummeted to their lowest level in 45 years, according to a recent report from the Building Industry and Land Development Association. The data reveals a deepening crisis in the region's housing market, with only 5,314 new units sold throughout 2025.
Record Low Sales and Soaring Inventory
The December sales figures were particularly alarming, marking what research manager Edward Jegg of Altus Group Ltd. described as an "all-time low." The inventory of unsold new homes in the GTA has ballooned to 26 months at the end of December, creating a significant imbalance in the market.
What makes this situation particularly concerning is the persistent elevation of prices despite declining demand. The benchmark price for new condominium apartments remained above $1 million in December, while new single-family home prices saw only a modest nine percent decline over the past year.
Condominium Market Suffers Steepest Decline
The condominium segment experienced the most dramatic downturn, with only 87 new units sold in December. This represents a staggering 91 percent decrease from the 10-year average. Given that condos traditionally serve as entry-level housing options, this sharp decline limits overall market turnover by reducing the number of buyers who can eventually transition to other housing types.
Single-family home sales fared slightly better but still remained nearly 60 percent below the 10-year average. This pattern suggests that affordability constraints are affecting multiple segments of the new-home market rather than being isolated to one particular category.
Economic Implications and Job Risks
The housing slowdown carries significant economic consequences beyond the real estate sector. BILD chief operating officer Justin Sherwood warned that new-home sales have declined "well into the double digits" across Ontario, placing approximately 100,000 jobs at risk. He characterized new-home construction as having "effectively stalled," highlighting its crucial role as both an employment generator and investment driver.
Factors Contributing to the Downturn
Several key factors are contributing to the depressed market conditions:
- Geopolitical uncertainty affecting buyer confidence
- Persistently elevated housing prices despite declining sales
- The Bank of Canada's indication that the interest-rate cutting cycle has ended
- Affordability constraints across multiple housing segments
Future Housing Supply Concerns
Industry experts have raised alarms about the potential long-term impact on housing supply. Projects that are delayed or cancelled due to weak pre-sales could significantly reduce the number of housing completions in coming years. This supply constraint emerges even as population growth continues to generate demand for housing in the region.
The widening gap between declining demand, elevated prices, and rising inventory levels suggests the GTA housing market faces significant challenges that extend beyond typical cyclical adjustments. With 100,000 jobs potentially at risk and future housing supply in question, the situation requires careful monitoring by policymakers, industry stakeholders, and potential buyers alike.
