New Home Sales in the Greater Toronto Area Face Challenges
New home sales in the Greater Toronto Area have been facing significant challenges, with May marking a continuation of an alarming trend. According to the Building Industry and Land Development Association (BILD), new home sales reached a historic low, contributing to the worst downturn in sales the region has ever witnessed.
In May, only 345 new homes were sold, reflecting a staggering 64% drop compared to the same month the previous year. This figure is also 87% below the average of the last decade, as reported by Altus Group, the official source for new home market intelligence. Typically, May would see around 2,749 new home sales, which emphasizes the dramatic downturn currently affecting the GTA.
Market Conditions: A Buyer’s Favor but Low Confidence
Edward Jegg, Research Manager at Altus Group, commented on the current market dynamics, saying, “May 2025 new home sales across the GTA remained at rock bottom levels. Market conditions definitely are in the buyer’s favour right now; they just need the confidence to move ahead with their purchase.”
The breakdown of sales reveals that condominium apartments were particularly hard hit, with only 137 units sold. This represents a 74% decrease from May 2024 and a dramatic 93% decline from the 10-year average, further illustrating the challenges facing prospective homeowners.
The Situation for Single-Family Homes
Single-family homes also saw a decline, with only 208 sales reported in May, a drop of 53% from the same month last year and down 74% from the 10-year average. This category, which includes detached, linked, and semi-detached houses, underscores the continuing struggles of this segment of the housing market.
Additionally, new reporting for this year from BILD and Altus Group highlighted that Simcoe County recorded 26 single-family home sales in May, with an average price of $1,140,131. This incorporation of sales data from Simcoe County reflects a broader effort to understand regional housing trends.
Impact of Low Sales on Future Construction
As new home sales dwindle, there is a direct correlation with construction activity. Alarmingly, projections suggest a potential decline of up to 23,000 housing starts by 2027 compared to levels seen in 2024. This downturn could threaten as many as 41,000 jobs within the residential construction sector and could impact nearly $10 billion in annual construction investment in the Greater Toronto Area.
Justin Sherwood, Senior Vice President of Communications and Stakeholder Relations at BILD, painted a concerning picture of the current conditions, stating, “The current cost to build crisis is real, it’s here now, and it will have very negative impacts on the economy.” Sherwood called for urgent actions from all levels of government to collaborate with the industry, aiming to reduce housing costs significantly.
Call for Tax Reform
There is a pressing need to address taxes associated with new home developments. Sherwood emphasized that it is crucial for the government to reconsider its taxation structure, particularly regarding GST/HST and development charges. This reform is essential to secure the future supply of new homes and meet the ever-growing demand within the region.
Benchmark Prices in the GTA
The benchmark prices for new homes in the GTA reflect the downturn in sales, showing a decrease in both single-family homes and condominium apartments when compared to the previous year. The benchmark price for new condominium apartments now stands at $1,021,339, which is a 2.2% decrease over 12 months. Similarly, the benchmark price for new single-family homes has dropped to $1,505,539, reflecting a 6.6% decline during the same period.
The Voice of the Building Industry
BILD represents over 1,000 member companies within the home building and land development sectors in the Greater Toronto Area. The organization plays a vital role in providing advocacy and support for the building and renovation industry, which currently employs 256,000 individuals and contributes an impressive $39.3 billion in investment value to the region’s economy. BILD is closely affiliated with both the Ontario and Canadian Home Builders’ Associations.
Frequently Asked Questions
What factors are contributing to the decline in new home sales in the GTA?
The decline in new home sales is linked to lowered consumer confidence, high construction costs, and market uncertainties impacting buyer decisions.
How many new home sales were recorded in May 2025?
In May 2025, only 345 new home sales were reported in the Greater Toronto Area.
What is the predicted impact of low sales on housing starts?
It is predicted that low sales could lead to a decline of up to 23,000 housing starts by 2027 compared to 2024.
What changes are proposed to help improve the housing situation?
Urgent reforms are needed, including lowering GST/HST and development charges to make new homes more affordable.
What is BILD's role in the housing industry?
BILD represents the home building and land development sectors in the GTA, advocating for industry interests and supporting local job creation and investment.
