Here's how much the average home in Ontario is expected to cost in 2025

Amid what has been an astoundingly sluggish few months for real estate in parts of Ontario, experts are now trying to reassure panicky sellers and developers that the heat is set to return to the market — and with it, even higher prices for buyers, if they’re correct.

Following the release of Royal LePage’s forecast last week foretelling a 10% hike in average home prices in the Toronto area specifically by the end of this year, the Canadian Real Estate Association has just dropped its own forecast for each province and the country at large looking further ahead to 2025.

Based on this year’s trends so far, impending interest rate cuts and other factors, the trade group is calling for the cost of the typical home to increase in every single province next year, by as little as 2% in PEI to 7.9% in Alberta.

While that Prairie province will see the largest proportionate and dollar amount surge in housing costs, Ontario and BC were not far off (naturally, being the most expensive provinces to buy within the country).

The CREA’s experts say the average home price in Ontario will go up by 0.7% in 2024 and another 3.9% in 2025.

The CREA predicts that the average price of a house or condo in Ontario will rise by 0.7% by the end of 2024 to hit $876,965 — still an escalation in a lifeless market that should be driving prices downward — before climbing 3.9% in 2025, reaching $911,150.

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The association also says activity will return with a vengeance, with 7.3% more homes finding new owners in the province in 2025 (an expected total of 178,461) after a 2.2% spike in this figure by the end of 2024 (an expected total of 166,303).

This puts Ontario ahead of all other provinces when it comes to the volume of home sales by far, though Nova Scotia and BC are set to see larger upticks in sales numbers (11% and 10.3%, respectively).

The trade group says sales activity will also resume, with 2.2% more transactions in 2024 and 7.3% more than that in 2025.

“Since CREA’s last forecast in April, expectations around interest rate cuts this year have been dialled back. Supply has also built up by more than expected as large numbers of sellers came to the market with properties for sale in the spring; however, buyers remained on the sidelines,” the report states.

It adds that “lower interest rates are still expected to gradually bring buyers back into the market going forward,” though not as strongly as the association had previously thought given this spring.