Toronto-area new home sales are worse than during the 1990s housing market crash

Toronto-area new home sales are sliding deeper than during the early 1990s housing crash, marking an unwelcome milestone in Canadian real estate history. In April 2025, only 310 new homes were sold across the Greater Toronto Area (GTA). That number is 72% lower than April 2024 and a staggering 89% below the 10-year average, which would typically be about 2,750 sales in April. Even at the weakest point during the 1989–1996 downturn, monthly new home sales were roughly double today’s levels.

When broken down by type, the situation is stark: only 105 new condo units sold in April — down 80% year-over-year and 94% below average. New single-family home sales fared only slightly better at 205 units, representing a 66% drop from 2024 and 77% below the decade norm. These figures highlight demand collapsing across both high-density and suburban segments of the new housing market.

Prices are slipping, though more gradually than sales. The benchmark price for a new condo fell 3.6% over the past 12 months to about $1.019 million, while single-family homes dropped 5.4% to around $1.53 million. Though these declines suggest easing, they remain only modest compared to how dramatically demand has tanked.

Experts cite economic uncertainty as a major reason buyers are staying on the sidelines. Potential buyers want stability — but worries about tariffs and broader financial unpredictability are sapping confidence and silencing demand. Even after interest rates started to ease in early 2025, the market failed to regain momentum, and relatively high prices gave builders little reason to make significant cuts.

Despite the drop in sales, inventory remains elevated. The GTA currently has enough unsold new homes on the market to last 15 months, well above the healthy range of 9 to 12 months. While that may seem like breathing room for buyers, it also signals a built-up backlog that could translate into fewer new builds coming online in the late 2020s. Completions could plunge from over 30,000 units in 2025 down to just under 10,000 by 2028, raising the risk of a future supply crisis.

At its core, the current slump may be more painful than the early 1990s crash — even though those years saw price drops of over 27% in Greater Toronto. Today’s crisis is fueled by the collapse in demand rather than overbuilding, combined with stubborn prices and a looming shortage of supply. If builders continue to delay or cancel projects, the region could face a scenario of tight housing options and renewed upward pressure on prices just a few years down the line.