You bought in 2022. Market peaked. Three years later, you're selling — for less than you paid.
That scenario hit 36.6% of Ontario homeowners who bought at the 2022 peak and sold in 2025. Nearly four in ten took a loss.
Why Are So Many Ontario Homes Selling at a Loss?
Teranet, the private company managing Ontario property titles, released its 2025 market overview. Of homes purchased in 2022 and sold in 2025, 36.6% sold for less than the owner paid. That's five times the loss rate for homes bought in 2020.
Homes purchased in 2023 fared better — 24.6% sold at a loss in 2025. Compare that to 2021, when fewer than 2% of recent sales recorded losses. The shift is driven by Bank of Canada interest rate hikes, inflation, and a cooling market that caught peak buyers at the worst time.
Which Ontario Regions Had the Highest Loss Rates?
Dufferin led with 37.8% of sales at a loss. Niagara North hit 32%. Halliburton reached 27.8%.
But the most populated areas also saw significant losses. Peel Region (Mississauga, Brampton, Caledon) recorded 29.6% of sales at a loss. Durham (Oshawa, Pickering, Ajax, Whitby) hit 23%. Toronto came in at 22.3%.
According to Karan Malhotra, a manager at Teranet, the Toronto condo market drove much of the decline in the $500,000-$1 million price range — where 37.9% of 2022 buyers lost money by 2025.
How Did Price Range Affect Losses?
Homes in the $500,000-$1 million range saw the highest loss rate — 37.9% for 2022 buyers selling in 2025. Most were condos in the Greater Toronto Area, where values dropped sharply.
The $1 million-$3 million category didn't fare much better — 33.7% sold at a loss. Big drop.
For example, Malhotra notes that mid-tier suburban homes — not in "posh" areas — often sold for $2.9 million-$3.2 million during COVID. By 2025, many corrected back into the $1 million-$3 million range.
How to Avoid Selling at a Loss in Today's Market
If you're facing a loss, here's what you can do to minimize the damage and protect your credit:
- Get a current home valuation. Use CREA's Home Price Index or hire an appraiser to know your true equity position.
- Review your renewal options early. Contact a mortgage broker 120 days before your renewal date to shop rates across multiple lenders.
- Consider porting your mortgage. If you're moving, porting lets you keep your existing rate and avoid breaking penalties.
- Negotiate with your lender. Some lenders offer payment deferrals or extensions if you're facing short-term hardship.
- Explore alternatives to selling. Renting out your property or taking in a roommate can cover costs while you wait for market recovery.
What's Happening With Power of Sale Transactions?
Power of sale (POS) transactions — where lenders take control of a sale to recoup debt — hit 2,979 in 2025. That's a 415% increase since 2022, when the number bottomed out at 578.
It's the highest count since 2016. After the 2008 financial crisis, POS sales peaked at 7,790 in 2011 (2.35% of all transactions). A decade of low rates drove that number down every year — until 2022.
According to CMHC data, rising mortgage rates, inflation, and pandemic-related unemployment all contributed to the surge. Michael De Luca, a realtor with Re/Max Hallmark, says investment properties — especially condos — are driving the uptick.
Many homeowners don't realize that power of sale happens faster in Ontario than foreclosure in other provinces. Lenders can begin proceedings 15 days after a missed payment.
Should You Expect More Losses in 2026?
Malhotra hasn't compiled full 2026 data yet, but he expects ongoing pressure. Mortgage renewals from ultra-low 2021 rates will face today's higher costs. Trade war uncertainty and inflation add more strain.
"I think a lot of renewals will decide the market shift," he said.
If you're renewing in 2026, compare your options early — a broker can shop multiple lenders and find the best rate before your deadline.
How Are First-Time Buyers Affected?
The average age of a first-time buyer in Ontario rose from 36 in 2015 to 40 in 2025. That's a four-year shift in a decade.
Here's the thing: even though prices dropped, the stress test and higher borrowing costs shrunk the pool of qualified buyers. Professionals in their early 30s — people who would've bought easily in 2019 — now struggle to save down payments without family help.
Imagine you're 32, earning $85,000, with $40,000 saved. In 2019, that got you a $450,000 condo with 10% down. In 2025, the same income qualifies you for $320,000 — not enough for most markets.
| Year Purchased | % Sold at Loss (2025) | Typical Property Type |
|---|---|---|
| 2022 (peak) | 36.6% | GTA condos, mid-tier suburban homes |
| 2023 | 24.6% | Mixed — condos and detached |
| 2020 | 7.3% | Pre-pandemic purchases |
Frequently Asked Questions
What percentage of Ontario homes sold at a loss in 2025?
36.6% of homes purchased in 2022 and sold in 2025 recorded a loss, according to Teranet. Homes bought in 2023 fared better at 24.6%.
How much did power of sale transactions increase in Ontario?
Power of sale transactions hit 2,979 in 2025 — a 415% increase from 578 in 2022. Most are investment condos in the GTA.
Why can't first-time buyers afford homes even after prices dropped?
The stress test and higher borrowing costs shrunk the pool of qualified buyers. Even professionals in their early 30s struggle to save down payments without family help.
Ready to take the next step? Arch Canada can match you with a broker.