Toronto’s Real Estate Market: Condos vs Freehold Homes in 2025
Despite economic headwinds and frustrating red tape, there’s a silver lining emerging in Toronto’s complex real estate landscape. Today’s conversation across the industry points to a widening gap between condo challenges and freehold opportunities, suggesting a strategic pivot for buyers eyeing long-term value.
The Condo Conundrum: Delays, Fees, and Design Flaws
In the heart of Toronto, condo development is stuck in a costly bureaucratic maze. Developers are paying over $100,000 in city development fees, and facing years of delays just to get projects approved. One insider noted, “You’re paying during the four and a half years it takes the city to say yes.”
These delays are compounded by rising holding costs, regulatory inefficiencies, and product issues—especially micro-condos under 500 sq. ft., which are losing appeal. In today’s market, you need to “have an enormous price discount just to move units,” suggesting the immediate outlook for condos remains weak.
But There’s a Catch: A Coming Undersupply
Despite today’s slump, experts are already projecting a condo undersupply by 2028, driven by steady population growth and years of underbuilding. As one source puts it, “Nothing’s being built… but the population is still growing.”
That means better-designed, larger condos in good locations may be undervalued today but could rebound significantly in the next 5–7 years.
Why Freehold Homes Are the Best Value Today
Compared to condos, freehold properties (detached, semi-detached, and townhomes) aren’t facing the same delays or fee structures. This makes them:
- Easier to transact
- Less dependent on city approval cycles
- More appealing for buyers wanting certainty
With condo supply stagnating and many developments paused indefinitely, demand could shift toward freehold homes, boosting their long-term value.
Toronto vs Manhattan: A Tale of Two Cities
In contrast, Manhattan offers a masterclass in efficient urban development. “In Manhattan, it’s illegal to block a road lane for condo construction—it’s been law for 40 years.” The result? Less disruption, quicker builds, and better mobility. Toronto could learn a thing or two.
Recommendation: What Should Buyers Do in 2025?
✅ Best Value Right Now: Freehold HomesIf you’re buying in 2025, freeholds offer stability and better long-term value, with less exposure to the condo market’s delays and pitfalls.
💡 Condo Strategy (Long-Term):If you have patience and can find larger, well-designed units, condos could see major upside by 2028–2030, especially as undersupply intensifies.
Optimism for Canadian Home Ownership
Despite the red tape, there’s reason to be hopeful:
- Population growth continues to support housing demand.
- Delayed construction today = rising value tomorrow, especially for well-built products.
- Market cycles always reward informed, long-term buyers.
As the dust settles, thoughtful home design and smart investments will lead the next wave of real estate growth in Toronto—and beyond.
