Toronto real estate market may see stability as rates hold in 2026

Economists expect the Bank of Canada to keep the benchmark rate at 2.25% in 2026, and the Toronto Regional Real Estate Board reported an annual average selling price of $1,067,968 in 2025, down 4.7% from 2024.

Economists expect the Bank of Canada to leave its benchmark interest rate at about 2.25 per cent in 2026. Realtors say that steady rates could prompt some buyers to act rather than wait for cuts. The Toronto Regional Real Estate Board released its 2025 market report showing lower sales and more listings across the Greater Toronto Area. TRREB described improved affordability in 2025 as setting the market up for a possible recovery. Key figures: - Economists expected the Bank of Canada benchmark rate to remain near 2.25% in 2026. - TRREB reported GTA sales were down 11.2% in 2025 compared with 2024. - New listings in 2025 rose about 10%, which the report said allowed selling prices to be negotiated downward. - The 2025 annual average selling price was $1,067,968, down 4.7% from $1,120,241 in 2024. - TRREB noted December 2025 sales fell 8.9% year over year and the average selling price for December dipped 5.1% to $1,006,735. - The composite benchmark price, a representation of a "typical" home, dropped about 6% to $942,300. Summary: Lower selling prices alongside steady mortgage rates were described by TRREB as improving affordability and preparing the market for recovery. Undetermined at this time.