Ontario Real Estate Market: Stabilizing Amid Buyer Caution
Ontario’s housing market is currently experiencing a period of adjustment characterized by slower sales, modest price declines, and cautious buyer sentiment. April 2025 marked the lowest level of home sales for that month in five years, with 14,244 transactions—a 20.2% drop compared to April 2024 and 31% below the five-year average for April
Key Market Indicators
• Average Home Price: The average home price in Ontario was $859,645 in April 2025, down 0.1% from March and 4.5% year-over-year
• Sales-to-New-Listings Ratio: The ratio stands at about 35-39% across most urban centers such as Toronto, Mississauga, and Hamilton, signaling a firm buyer’s market where supply exceeds demand.
• Inventory Levels: Active listings surged by approximately 38.8% year-over-year in early 2025, contributing to softer prices and slower sales
• Demographic Growth: Ontario welcomed over 410,000 new residents in the past year, primarily through immigration, which supports long-term housing demand despite current affordability challenges
• Sales-to-New-Listings Ratio: The ratio stands at about 35-39% across most urban centers such as Toronto, Mississauga, and Hamilton, signaling a firm buyer’s market where supply exceeds demand.
• Inventory Levels: Active listings surged by approximately 38.8% year-over-year in early 2025, contributing to softer prices and slower sales
• Demographic Growth: Ontario welcomed over 410,000 new residents in the past year, primarily through immigration, which supports long-term housing demand despite current affordability challenges
Trends Shaping Ontario’s Market
• Remote Work Migration: The rise of hybrid and remote work has shifted demand toward suburban and smaller urban areas like Simcoe County and Niagara, where buyers seek larger homes and outdoor space
• Affordability Challenges: Despite price moderation, affordability remains a significant concern, especially in the Greater Toronto Area where average prices exceed $1 million5. Smaller cities such as London and Windsor offer relatively more accessible options.
• Government and Mortgage Influence: Recent interest rate cuts by the Bank of Canada have begun to lower borrowing costs, which may encourage more buyers to re-enter the market later in 2025.
Outlook
Market experts expect Ontario’s housing market to stabilize with modest price growth as borrowing costs ease and supply-demand balance improves. A sharp market crash is unlikely; instead, a more balanced market with increased opportunities for buyers, particularly first-time purchasers, is anticipated
Alberta Real Estate: Robust Growth and Balanced Conditions
In contrast to Ontario’s cautious market, Alberta’s real estate sector is showing steady growth and balanced conditions in 2025. Calgary and Edmonton are leading this positive trend, supported by economic diversification and population growth.
Market Highlights
• Price Growth: Calgary’s average home prices are forecasted to rise by 3-5%, while Edmonton is expected to see gains of 2-4% in 2025. The provincial average home price is approximately $503,000.
• Balanced Inventory: Sales-to-new-listings ratios near 58% and months of supply below five indicate a seller’s market but with healthy inventory levels that prevent overheating.
• Economic Drivers: Job creation in technology, finance, and other sectors is fueling demand, especially in suburban neighborhoods where affordability and space are priorities.
• Tax Considerations: Homeowners should be aware of a 14% increase in education property taxes and municipal rate adjustments expected in 2025, which may affect carrying costs.
Market Dynamics
Alberta’s housing market benefits from more affordable price points relative to many parts of Ontario, attracting both local buyers and investors. New home construction remains active, particularly in energy-efficient and smart home segments, aligning with buyer preferences for modern, sustainable living.
With strong economic fundamentals and balanced supply-demand metrics, Alberta’s real estate market is poised for continued steady growth throughout 2025. Buyers and sellers can expect a relatively stable and opportunity-rich environment.
Conclusion
Ontario’s real estate market is stabilizing amid buyer caution and affordability pressures, while Alberta’s market is experiencing robust growth supported by economic diversification and balanced conditions. Both provinces offer unique opportunities shaped by local factors, making it essential for buyers, sellers, and investors to stay informed and work with experienced real estate professionals.
Royal Cachet Realty is here to guide you through these evolving markets with expert advice tailored to your goals.
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