The Loonie Hour We Have a Crisis in the Toronto Condo Market
May 30, 2025
The Toronto condo market is experiencing a major slump, with pre-sale prices dropping to 1990s levels. Job losses are rising, alongside fears of increased credit losses as banks react to market fluctuations. The potential for interest rate cuts by the Bank of Canada is debated, while the impact of Trump tariffs enters the courtroom. The discussion extends to bad news for the construction sector, fiscal warnings about rising debt, and the delicate balance of government spending in the face of economic challenges.
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GTA Condo Market Collapse
- The GTA new home sales in April plunged 72% from last year and 89% below its 10-year average.
- Resale condos have 8 months of inventory, severely depressing new construction demand and prices.
Real Estate Market Price Illiquidity
- The real estate market is illiquid, making price discovery difficult and leading to 'no bid' situations.
- Prices have declined about 5-10% recently, but uncertainty delays further price adjustments.
Canada's Job Growth Lags Immigration
- Since 2023, Canada added 2.5 million immigrants but only 260,000 jobs, showing a job market imbalance.
- Most sectors except mining, oil and gas, and public administration experienced job losses, signaling weak employment.