Bank of Canada Holds Overnight Rate, and Toronto Home Sales Plummet

This week’s top real estate stories.

By Jared Lindzon | 2 minute read

Every Friday, Wahi brings you the most important real estate stories from the past week. 

New Buyers Getting New Discounts on New Homes

Who says a starter home has to be a fixer-upper? Not Mark Carney. In fact, the new Prime Minister is making good on an election promise to make it easier for first-time buyers to enter the market via a brand spanking new piece of real estate. Late last week the PM introduced a bill that would, to borrow a phrase we heard often during the election, “axe the tax” on new homes for first-time buyers. If passed, the bill would give first-time buyers a 5% rebate on the GST portion paid on new home purchases.   

Toronto Landlords Resorting to Bribes 

Renting in Toronto right now is kind of like being in the audience of the Oprah Winfrey Show, as landlords shower tenants with free gifts. With competition getting fierce there are reports of landlords offering rent-free months, complimentary Wi-Fi, gift cards, even private health care. Their desperation is warranted given the state of the market, with an estimated 6,500 rental units sitting empty in the GTHA as of the end of the first quarter, up 29% from the same time last year, according to Urbanation. That report found 63% of buildings are offering renter incentives, more than double last year.

Hold Your Horses  

Those waiting on another rate cut are going to have to wait a little longer. That’s because, after some surprisingly positive GDP data last week, the Bank of Canada decided to keep rates at their current 2.75% spot. According to the Bank the economy has remained surprisingly resilient, though uncertainty remains high. In its statement on Wednesday, the Bank explained that they, like the rest of us, have no idea what the tariff-loving world leader next door will do next, and are afraid to make any drastic moves in the meantime — albeit using slightly different words.

Toronto Home Sales Take a Tumble, Along with Prices  

Understanding market dynamics can be complicated, but even those who flunked math can solve the equation in the GTA, where housing supply is skyrocketing, while demand is diminishing. You know what that means; home prices are on their way down. According to The Toronto Regional Real Estate Board, new listings shot up 14% in May compared to last year, while home sales dropped 13.3%, marking the worst May for home sales since that one in 2020 when we thought the world was ending, and second since 2002. As a result, prices are down 4% since last year, averaging $1.1 million.     

Canada’s Most Overpriced Market Becomes Slightly Less So  

Buyers aren’t just getting the last laugh in Toronto, as Canada’s other historically overpriced market also gets its comeuppance. According to Greater Vancouver Realtors, home sales were down 18.5% last month compared to May of 2024, and more than 30% below the month’s 10-year average. At the same time,  inventory increased almost 4% from last year and sat nearly 46% above the 10-year average. As seen on the other side of the country, more supply and less demand is putting downward pressure on prices, which fell 0.6% over the previous month and nearly 3% over the previous 12.

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