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Hamilton Spectator
3 days ago
- Business
- Hamilton Spectator
Is Toronto's real estate market crashing? Home prices will keep dropping, experts say — but it won't feel like any crash we've had before
For the first time in more than 30 years Canadians are facing a shocking truth: home prices don't go up forever. Toronto's real estate market is facing its sharpest decline since the 1990s, something the boomer generation might remember well, but subsequent generations not so much. The real estate market has been a key driver for Canadians to attain wealth — long seen as a smart investment tool. But that notion is crashing. Since the February 2022 peak, the average sales price in the GTA has dropped by almost 18 per cent. At least one expert says the region could see a peak-to-trough decline of 23 per cent, while other economists say it's unclear how low prices will go. While the current climate is reminiscent of the late 1980s and early 1990s recession — when home prices plunged by around 38 per cent in the GTA — economists say this slump won't feel like a housing crash in the traditional sense. That's because home prices are still well above 2019 levels, they say, so the current decline is more like a post-pandemic correction, following the unsustainable rise in home prices from 2020 to 2022. Economists say prices in Toronto will continue to drop into next year, but the decline will happen slowly and steadily as immigration declines and interest rates are unlikely to drop much further. 'A 20-per-cent decline after that type of run-up isn't something that we can call a crash,' said Philip Cross, senior fellow at the Macdonald-Laurier Institute. 'If the market stopped declining now, you'd conclude prices are still very high and affordability hasn't been addressed.' The biggest change in the real estate market is mindset — consumers are finally understanding that real estate isn't the golden ticket to a quick buck, or the only way to ensure a comfortable retirement nest egg. 'People's expectations are being reset,' said Victor Couture, associate professor of economic analysis and policy, and the Camrost Felcorp Chair in Real Estate at the Rotman School of Management. 'What is happening is we've had this narrative that sustained rapid price growth can only go up, it's this great investment. But now we're seeing a sustained drop in prices after a large event.' 'Overall the market is in stasis,' said Tony Stillo, director of Canada Economics at Oxford Economics. Sales in Toronto's resale market have been below the 10-year average for the last three years while new listings have surged, meaning there's more supply than demand. Sellers have to adjust their prices to attract buyers, and buyers are able to negotiate better terms in the sale. 'Sales are really low, particularly in Toronto,' Stillo said, adding that affordability, the U.S. trade war and job security are making buyers wary of jumping into a massive purchase at this time. 'We're not in for a crash, but Toronto prices will continue to decline,' adding that home prices will drop 10 per cent by the fourth quarter of 2025 from the fourth quarter in 2024. Stillo noted that the total peak-to-trough price decline is forecast to be around 23 per cent. There isn't a technical definition of a housing crash. Some experts have said it's when prices drop by 30 per cent or more . Some economists said it's difficult to forecast home prices due to the current number of variables, but noted there isn't rapid population growth, low interest rates or strong economic growth to place upward pressure on prices. Because of this, Couture said it's likely home prices will continue to decline next year, but he couldn't say by how much. 'Are we going to see an improvement to these three factors next year? I doubt it,' added Cross. So far the country has bucked a recession despite Trump's tariffs and trade uncertainty, he said, but 'while the Canadian economy has performed surprisingly well, risk remains.' But economists agreed that it's highly unlikely overall prices will fall by more than 30 per cent in the GTA from current levels to completely reverse price gains that occurred during the pandemic. The average GTA price in June 2025 was $1.1 million, a 32-per-cent increase over June 2019, when the average was $833,000. During this period, just three neighbourhoods in Toronto saw average prices drop to 2019 levels , due in large part to more condos selling in those areas, dragging the average price down. Tom Storey, sales representative with Royal LePage Signature Realty, noted that small studio or one-bedroom condos in Toronto are selling for 2019-level pricing but the two- and three-bedroom condo units are still garnering substantial interest from first-time buyers because there's limited stock of this housing type. 'Detached homes are still in a very balanced market, semi-detached homes in some pockets are in a sellers' market if priced right, and condos are buyers' market territory,' he said. Because there is excessive condo supply, with record-levels of new supply entering the market this year, it will take years before market conditions balance, experts say. Nearly 60 per cent of the active listings in Toronto in June were for condos, according to the Toronto Regional Real Estate Board (TRREB). Average prices in these ritzy areas are down, but those expecting a deal on a Forest Hill mansion may be disappointed. Average prices in these ritzy areas are down, but those expecting a deal on a Forest Hill mansion may be disappointed. While homeowners are seeing the value of their properties drop, prospective buyers are still being priced out of the market. 'Prices are still well above pre-pandemic, and even though incomes have continued to rise they haven't kept pace,' said Kari Norman, economist at Desjardins. 'Prices have come down but that doesn't mean we're back to an affordable level.' Over the past quarter century, the average selling price of a home in Canada has ballooned by more than four times, while the average household disposable income has only slightly more than doubled, Norman wrote in an economic report published in May. Housing is considered affordable when households spend no more than 30 per cent of their disposable income on housing costs. In Toronto, households spend at least two-thirds of their income on housing. Cross said house prices and incomes need to reach 'a sustainable equilibrium,' but that in order for home prices to come down in a 'meaningful way' the ratio of home prices to incomes would need to reach an affordable level. To get there the economy would experience job loss and a slowing labour market, as incomes wouldn't be able to rise quickly enough. Already signs of strain are showing. Ontario's 90-plus day mortgage delinquency rate rose 71.5 per cent since the first quarter of 2024, to 0.24 per cent from 0.14 per cent. Power of sales in Ontario in 2024 also trended up, surpassing 2018 levels, according to Teranet, a real estate registry services company. But to get a significant drop in prices to reach levels of affordability, there would need to be much more pain the market, Cross said. 'At some point house price values have to be rooted in the reality of what is affordable,' Cross said. 'These overvalued house prices can't be supported forever — people's incomes just can't support it.' They key takeaway in this real estate moment is 'resetting of people's expectations,' said Couture. 'The path to wealth shouldn't be to buy property,' Couture said, 'but that's the mindset that's been fed to people for so long.' The Star compiled projects that have been cancelled, converted or put into receivership. Check our interactive map to see your neighbourhood. The Star compiled projects that have been cancelled, converted or put into receivership. Check our interactive map to see your neighbourhood. Already, the condo market , which is largely driven by investor demand , has been put on hold because investors are no longer buying units — the rent isn't enough to cover mortgage costs. And house flipping has taken a back seat because prices aren't drastically growing, so the profit when selling isn't there. 'Canadians are learning what Americans learned after the 2008 financial crisis,' Couture said. 'Houses are places for people to live.' If housing is being used as an investment tool, 'not every investment makes you money,' Stillo said. If the intense speculation of investor activity doesn't come back, there would be less volatility in the market and the supply would be dictated by what end-users want. While Cross said the speculation frenzy won't return any time soon, he doesn't think there's been a big enough drop in prices to teach 'the lesson that needs to be learned.' 'The stock market crash in the 1930s or 2008 financial crisis teaches a generation to be more prudent with money,' he said. 'That lesson would not be learned if we froze the market today.'
Hamilton Spectator
5 days ago
- Business
- Hamilton Spectator
He's sent out 1,100 job applications — and still hasn't been hired. Canada's youth are facing rising unemployment rates
When Sami Rasheed started his first year at the University of Toronto's Rotman School of Management, he saw a bright future ahead. Near the top of his class in high school, Rasheed threw himself into his new adventure. He started his own club, achieved good grades, and eventually secured an internship at a large pension firm. As he neared the end of his program, however, Rasheed had some health problems, delaying his studies by a year. By the time he graduated in spring 2024, Rasheed had already applied to a handful of companies. More than a year — and hundreds of applications — later, he's still searching. 'I've been unrelentingly looking for a job since the September before my graduation,' Rasheed said in an interview. 'Since I started tracking, I've sent out about 1,100 applications. 'This job market has completely broken me.' While frustrating, Rasheed's story is common among Canadian youth right now. According to Statistics Canada , people age 15 to 24 are currently facing the highest unemployment rate outside of the pandemic since the mid-1990s. The trend is reflected in Toronto. While the city's population and economy have grown in recent years, youth unemployment continues to trend upward. Between January and July of last year, data from The Toronto Foundation shows the percentage of young people without jobs went from 13.2 per cent to 19.8 per cent. There's no one factor pushing the rates of unemployment, says Sharif Mahdy, CEO of the Students Commission of Canada. Instead, a 'perfect storm' of conditions — lingering consequences of the pandemic, ongoing economic uncertainty, and the introduction of automation in the workforce — have all made securing a job more challenging for younger generations. 'I think there's a misconception that the individual youth are lazy or just don't have drive, but the reality is that they're having to work through a lot more complex issues than previous generations,' Mahdy said in an interview. 'They're just not growing up in the same world.' Sharif Mahdy, the CEO of the Students Commission of Canada, says a 'perfect storm' of conditions have made landing a job difficult for younger generations. In April, the Students Commission of Canada opened applications for 'The Art of Work,' a program that matches young people with job placements across the country. Made possible through a recent round of just over $1 million in renewed funding, the program was only intended to fill 150 work placements. Within weeks, however, the program had received over 200 applications. It was, Mahdy said, 'a surge in demand that we haven't experienced in decades — even in the pandemic.' The students commission is hoping that the number of applications received will result in an additional round of funding, which would in turn allow it to offer more placements, he said. It's the kind of program that 15-year-old Om Patel could have used during his job hunt this summer. At the end of the most recent school year, Patel, 15, decided he needed to start gaining work experience in advance of his university applications. Since May, he said he's handed out nearly 70 resumés to entry-level jobs with no luck. 'I think we need more support in our schools — like a teacher helping with resumés in class or some kind of after-school workshop,' he told the Star. 'We hear about these kinds of programs but never actually see them.' With no other prospects, Patel decided to start his own software development company. It's only been a couple of months but already he's had more success. 'I've already built products for a few clients,' he said. 'But so many of my peers are still looking for jobs. 'Something's got to change.' For racialized youth in the GTA, the barriers to getting a job can be even higher, says Ahmad Ilmi, assistant professor of Global Development at the University of Toronto. According to the most recent data from Statistics Canada, the unemployment rate among Black youth in Canada was just over 18 per cent in January 2025. In comparison, the unemployment rate of youth who were not racialized or Indigenous was just under 11 per cent at that time. In many cases, a fierce job market has seen older generations, many with years more of work experience than their younger counterparts, filling jobs once considered entry-level. A lack of support in the community for young job seekers — like resumé workshops or interview preparation — also makes it difficult. However, the biggest barrier remains bias and racism, says Ilmi. 'It's the other thing that no one really speaks about,' Ilmi said. 'People are constantly being bombarded with images of racialized youth in relation to crime or being up to no good, where they're seen as socially or culturally different — often hyper-violent and hyper-masculine.' If an employer is inundated with applications, many from candidates with more experience, or who don't have other obligations like school, it can become easy to overlook young, racialized applicants. 'It becomes pure economics,' he said. Youth employment isn't just about a paycheque, say Mahdy and Ilmi. A job offers stability, structure and a sense of community at a critical juncture in young people's lives. 'It's the reward of being able to contribute to their own well-being — to have some income, to be able to build a future based on that starting point,' Ilmi said. 'If you can't get a job, it doesn't allow you to have the same start in life as your peers,' Mahdy added. 'There's likely going to be an inability to kind of move forward in life, some may accumulate a higher debt load or see a decline in mental health.' That's certainly the case for Rasheed. While the U of T graduate has obtained part-time work at an accounting firm, he hasn't been able to find a full-time position in the field he studied for. Over the last year, he's grown increasingly worried for his future. 'Like, even if I find a job, what if I lose it? What if I'm laid off, like so many of my peers have been? Will this happen to me again? And beyond that, it's like, can I ever really buy a home or sign a 25-year mortgage not knowing what's going to happen in my future? 'Overall, it's a very heavy feeling,' he continued. 'I don't think it's an exaggeration to say it's a bit traumatizing.' He said he might have to change his strategy. 'I have a few warm leads but if they don't pan out, I'm just going to sit at my parents' house and wait till the next military recruiting cycle.' Error! 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Toronto Star
6 days ago
- Business
- Toronto Star
Finally, Canada is taking action on trade reliance with the U.S.: Will it be enough?
By Walid Hejazi Contributor Walid Hejazi is a professor of economic analysis and policy at the University of Toronto's Rotman School of Management. During Donald Trump's first term as president, it was clear that his approach to trade was anything but conventional. His broader tariff strategy, particularly against China, signaled a new era of economic nationalism. It seemed that free trade and the liberal order that characterized the post-Second World War era was coming to an end. When Joe Biden took office in 2020, protectionism didn't disappear, it just became more polite. Now, with Trump back in the White House in 2024, it is clear the era of free trade has ended.
Boston Globe
20-07-2025
- Politics
- Boston Globe
Trump's cuts threaten to rip research up by the roots
The chain saw approach to medical research funding is not just reckless — it's shortsighted. The families of the richest 2 percent also get cancer and other deadly diseases, and no amount of money can buy a cure that doesn't exist. Advertisement Dennis E. Noonan Wellesley Thank you for Kara Miller's article on the challenges of long-term research in the face of the Trump administration's cuts ( Get The Gavel A weekly SCOTUS explainer newsletter by columnist Kimberly Atkins Stohr. Enter Email Sign Up While only a small fraction of original ideas achieve success as envisioned, scientists consistently persevere with passion for their ideas. The research environment overall, however, brings waves of advances. Unlike the business and dealmaking mind-set of the current administration's so-called leaders, scientists are not self-promoters by type. They struggle for funding over years, driven by their passion for making a difference for the world. Advertisement The most telling risk inherent in the Trump cuts is the potential impact on global competition. As Miller points out, for decades some of the world's best minds have come here, with the United States having benefited. But more recently, greater global tools and competition have prompted serious foreign competition for the best minds — and for the opportunities to control future technologies. The administration's cuts would put the United States more than a generation behind in our children's and grandchildren's future world. Larry Kennedy Jacksonville, Fla. I weep when I see what the Trump administration is doing to our country and our world. Kara Miller's article on the savaging of basic science — 'research aimed at understanding rather than commercializing' — is but one example. This type of research may have no application right away. However, over 20 or 30 years, many dozens of applications may emerge, often covering many different fields. The original development rarely occurs in business laboratories because there is no immediate payoff. It is therefore essential that government continue to fund basic science. As Miller points out, a stable flow of funding is essential for the production of a continuing stream of research results. Disruption of the Trumpian kind has several undesirable results: Besides stopping the flow of original ideas, over the long term it will reduce our capacity to learn from and absorb ideas produced in other countries. We have seen mid-career scientists being welcomed by other countries while the paths of early-career scientists have been demolished. American politicians, Republican and Democratic alike, must stand up to the president and say, 'Basic research is the seed corn for 'Making America Great Again.' It must not be destroyed.' They should then act and vote accordingly in Congress. Advertisement Martin G. Evans Cambridge The writer is a professor emeritus at the Rotman School of Management at the University of Toronto.
Yahoo
14-05-2025
- Business
- Yahoo
Tariffs signage at Loblaw stores slammed by Canadian shoppers as 'opportunistic'
Loblaws is once again drawing ire from Canadian shoppers who are calling out the grocery giant's decision to mark products affected by the U.S.-Canada tariff wars. The company says the move is meant to bring more clarity to fluctuating pricing, but one expert calls it a puzzling way to address customers' anger at the rising cost of groceries. In March, Loblaw introduced a 'T' label to inform customers that some products' pricing have been impacted by the ongoing tariff dispute between Canada and the U.S. The T symbol is meant to inform customers when 'a product coming into Canada from the U.S. has had a tariff imposed that impacts its price,' a press release from the company explained at the time. The symbol appears within a product's electronic price tag, though there is also signage throughout stores informing consumers about the T label. On a post to the Loblaws is Out of Control subreddit, one user expressed their disdain and scepticism behind the company's intention. "Everything has been jacked up, with very few tariff symbols being used,' user Responsible-Oil3008 wrote on the post titled "Using tariffs to increase price of everything." '(Loblaws) is clearly opportunistically gouging Canadians under the general guise that we either won't notice or will expect higher prices during this geopolitical climate.' David Soberman, a marketing professor at Rotman School of Management in Toronto, says the decision to label tariff-impacted products is unlike anything he's seen before. 'In contrast to most signs that are trying to help people find a product that they want because of a positive attribute (like a sale) this is a sign that is supposed to justify or legitimize a negative attribute,' he tells Yahoo Canada. I'm not sure how easy it is to justify this. He says Loblaw appears to be playing on people's frustrations in the face of inflation and the current political climate. Since President Donald Trump started the trade wars earlier this year, Canadians have been trying to navigate where and how tariffs impact their spending habits. While many have committed to boycotting American products, some customers have found it tricky to grasp what's considered to be truly Made in Canada. Many shoppers are also worried about how the tariff war will hit their pocketbooks. In March, a poll found that almost three-quarters of Canadians felt nervous about personal finances in the face of the trade war with the U.S. 'In this environment there's some prices that may have gone up because of tariffs, and Loblaw's idea is to use that as a way to make sure the anger of an increase of prices is not going towards them but goes towards the tariffs themselves,' Soberman says. He also notes that the tariffs in question impacting the items were imposed by the Canadian government. On March 4, Canada started imposing tariffs on $30 billion worth of U.S. imported goods — including orange juice, some types of tea and coffees. 'It's unclear if people are going to say 'OK I'm not going to be angry with Loblaws, I'm going to be angry with Trump,'' he says. 'That doesn't make sense because the tariffs were placed by the Canadian government. It's kind of obscure.' Soberman can't say for certain whether other grocery stores will follow suit with the T-labels, but he doubts it. 'I'm not sure how easy it is to justify this,' he says. On a recent trip to two downtown Toronto Loblaws locations, Yahoo Canada could only find a handful of items with the T symbol, mostly in the beverage aisle. These included 1.19-litre bottles of Starbucks vanilla latte for $11.61, 1.75-litre bottles of Pure Leaf iced tea for $7.59, and 1.38-litre bottles of Tropicana Orange Juice for $8.72. In an email, a representative from Loblaw said the products mentioned have increased specifically due to tariffs and that the company is actively working to reduce the overall impact of tariffs by 'exploring alternative sourcing from other countries engaging with suppliers to help minimize price increases.' In an online thread about the "T" symbols at Loblaw-owned stores, some Reddit users expressed their frustration with for what they say feels like passing the buck — literally. 'Like they need a reason to screw over customers,' amtron767 wrote. 'Anything they can blame for raising prices they're going to use.' Others appreciated the labelling. "(It's) not a bad thing,' user Pristine-March-2839 wrote. 'Now we can make a conscious decision about buying an item or not, and it's undoubtedly better than the misleading label of 'prepared in Canada.''
