May Sales Flower as Detached Prices Continue to Settle 6.5% YoY
Today’s May TRREB sales results confirmed that 2026 will be another reset year for the Toronto Real Estate market. May is typically the market's lynchpin and routinely the strongest sales month of the year and this past May, GTA sales reached 6,583 transactions, up 6.3% year over year and stronger than any month recorded in 2025. However, across Toronto and the GTA, year-to-date sales are mirroring last year which was the slowest sales year in decades (-1% YoY).
Outside the current-day baseline of underlying economic uncertainty, one of the key drivers affecting home sales is the shift towards rental accommodation. In Q1 of this year 58% of transactions were rentals vs. just 30% in 2020. A big reason for the shift is rental prices are softening due to lower immigration levels and fewer international student visas as well as emigration from Toronto to more affordable parts of the country. Additionally, the first wave of Baby Boomers is now turning 80 and are cashing out the equity built through decades of homeownership, renting and not re-entering the re-sale market. Even some semi-retired Gen-Xers, are selling their homes and renting so they can travel more or have more funds for their active retirement years.
The lesson here for Buyers is to play the long game. Clearly, Millennials who recently purchased a home in the last 5 years are not cashing in on anything but if they hang in there, market home values will recover in the long run. They always have. Conversely if you are a Seller waiting for better days ahead on home prices, you will likely be waiting a minimum of 5 years or more for prices to return to their COVID-era peak. Placing your home on the market with realistic price expectations while other Sellers hesitate (New Listings -18.9% YoY) creates an advantage. Fewer competing listings mean greater visibility for well-priced properties.
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