January Priority Report

When the new year arrives, Toronto buyers and sellers want to know the same thing: what is actually going to happen, and who should they trust to tell them. Michael Prior, founder of The Prior Group at Revel Realty, head coach at Revel Realty, and one of the top real estate agents serving Little Italy, Seaton Village, College and Ossington, Junction Wallace-Emerson, Roncesvalles, Corso Italia, and surrounding west end neighbourhoods, is not in the business of predictions built on optimism. His 2025 forecast is built on transaction trends, historical volume patterns, industry data, and a ground-level read on where each segment of the Toronto market is positioned heading into the year.

He has three specific calls for 2025, and each one has a direct implication for buyers, sellers, and condo owners.

Prediction One: Sales Volume Will Rise by Approximately 10 Percent

Prior’s first prediction concerns the number of transactions, not prices, and it is grounded in a specific demographic and historical argument.

Toronto has been running well below its historical average for transaction volume over the past two years. The number of people who live in the city and who move within and around it has remained relatively stable, but the number of those people who actually transacted has fallen significantly. That gap between the population that should be moving and the population that is moving represents pent-up demand that does not disappear. It accumulates.

“If you look at the trends over the last 15 to 20 years and how many people live in Toronto and how many people move around in and around Toronto, we are well lagging behind the last couple years.” The implication is that a portion of the buyers and sellers who held back in 2023 and 2024 will re-enter the market in 2025 as conditions stabilize and confidence returns.

The Toronto Regional Real Estate Board’s own projections align with this read. Prior notes that TRREB appears to agree with a forecast of roughly a 10 percent increase in the number of people moving in 2025. For buyers who have been watching the market from the sideline, more transactions means more inventory and more opportunity. For sellers, it means a deeper and more active buyer pool than the past two years have offered.

Prediction Two: Home Prices Will See a Modest Increase of 2 to 4 Percent

The second prediction will matter most to sellers who have been waiting for a price recovery signal before listing. Prior sees a slight upward movement in home prices in 2025, in the range of 2 to 4 percent depending on the segment and the specific location within Toronto.

The mechanism behind this is well established. “When interest rates drop, prices do go up, although there is a bit of a lag effect.” The rate reductions that began in 2024 have not yet fully translated into purchasing power at the buyer level, but that transmission is underway and its effect on prices will become more visible in 2025. TRREB’s own forecast is consistent with Prior’s position on this, supporting a moderate price increase rather than a sharp recovery or a continued decline.

The 2 to 4 percent range is not uniform across all property types. Freehold homes in high-demand west end neighbourhoods like Roncesvalles, Little Italy, and Seaton Village are likely to outperform the average, while the condo segment faces additional headwinds from supply that will moderate its price performance. The specific segment and location matter as much as the city-wide average when translating this forecast into a decision about whether to buy or sell.

For move-up buyers who have been calculating whether to act now or wait for more recovery, a 2 to 4 percent price increase on both sides of a trade means the upgrade differential widens modestly in favour of sellers of higher-priced properties. The math rewards moving sooner rather than waiting for the recovery to run further.

Prediction Three: Condo Fees Will Rise, Driven by Reserve Fund Shortfalls

Prior’s third prediction is the one that will affect the most condo owners and that receives the least attention in mainstream real estate coverage. Condo fees are going up in 2025, and the driver is not general inflation on operational costs. It is a structural underfunding problem in reserve funds that has been building for several years.

The mechanism is straightforward. Reserve fund contributions are calculated based on engineering studies that project the future cost of major capital projects: window replacements, elevator maintenance, hallway repairs, and similar large-scale work. Those projections were made in a cost environment that no longer exists. “The projects that used to cost $200,000 are now costing $400,000, and they’re planning for a future project and they’re believing it’s going to cost $600,000 to change all the windows in the building.”

That tripling of projected costs, from $200,000 to $600,000 on a single project, leaves condo corporations in a position where the reserve fund balance accumulated over years of contributions at the old projected cost is materially insufficient for the work that actually needs to be done. The correction comes in the form of fee increases, special assessments, or both, and condo boards across Toronto are working through this math right now.

Prior’s advice to condo owners is direct and actionable. “If you’re in a condo, I would definitely speak to your board, speak to your property manager, and figure out what are the upcoming projects. Do they have enough funding? Are there special assessments coming?” This is not hypothetical due diligence. It is a practical step that every condo owner in Toronto’s west end should take before 2025 is underway.

For buyers evaluating a condo purchase, this prediction makes reserve fund review a non-negotiable part of the due diligence process. A building whose reserve fund was calculated on 2019 or 2020 cost projections may be carrying a fee increase or special assessment that is not yet reflected in the current monthly number. An experienced agent who knows how to read a status certificate and flag reserve fund concerns is an important layer of protection on any condo purchase.

What These Three Predictions Mean Together

Taken together, Prior’s 2025 forecast describes a market that is improving but not uniformly and not without risk in specific segments. Sales volume is rising, which is structurally healthy. Home prices are moving modestly upward, which rewards sellers who have been patient and buyers who act before the recovery runs further. And condo owners face a cost pressure that is independent of market direction and that requires proactive management rather than passive observation.

For buyers and sellers in Little Italy, Roncesvalles, Seaton Village, Corso Italia, College and Ossington, and Junction Wallace-Emerson, the 2025 environment is more navigable than the past two years. But navigating it well requires more than a general read on the market. It requires neighbourhood-specific knowledge, segment-specific strategy, and an agent who is watching the same indicators Prior is watching and translating them into advice that fits each client’s situation.

Work With Michael Prior and The Prior Group

The Prior Group at Revel Realty is recognized among the best real estate teams in Toronto’s west end for bringing this level of forecasting depth and market specificity to every client conversation. If you want to understand what Prior’s 2025 predictions mean for your property, your neighbourhood, or your next move, reach out directly.

Call Michael Prior: 647-376-7367 Email: mike@thepriorgroup.com Visit: thepriorgroup.com