February 2025 Real Estate Market Update: A Softer Start, But Opportunity Awaits

As we kick off the new year, January gave us an early glimpse into where the real estate market might be headed—and it’s looking like a calm, measured road ahead. Prices are edging down, inventory is building, and buyers are taking their time. Let’s break down the early data and insights from across the Peterborough area.

Local Market Recap: Peterborough & Area Real Estate Stats

The City of Peterborough kicked off the year with a 2.4% dip in average sale price, accompanied by a notable slowdown in sales activity. With sales down 24% year-over-year and active listings up over 70%, buyers are gaining leverage and taking their time. Meanwhile, sellers are facing increased competition and longer selling timelines, making pricing and presentation more important than ever.

• Average Days on Market: 24 days (up from 18 last year)
• Sales-to-Listing Ratio: Approximately 82%, reflecting a more cautious buyer pool
• Months of Inventory: 2.9 (up from 2.2)

In the greater Peterborough region—including Otonabee, Ennismore, and surrounding communities—market conditions echo the city’s cooling trend. The average sale price dropped 5.3%, and sales activity is down 21% from the same time last year. Listings, however, have surged, with 345 homes on the market compared to 2024’s tighter supply. This shift is creating more breathing room for buyers and highlighting the need for realistic pricing.

GTA Market Snapshot: What It Signals for Peterborough

Toronto’s real estate market typically sets the tone for nearby regions like Peterborough—and the latest GTA inventory trends offer some telling clues.

What does this mean for Peterborough? Historically, when inventory climbs in the GTA, it flows outward—bringing more listings and softer pricing to satellite markets like ours. With sellers returning and inventory staying elevated across the region, we’re likely to see a similar pattern locally: more selection for buyers and increased pressure on sellers to price competitively.

In short: if the GTA is any indicator, Peterborough is heading toward a more balanced, possibly buyer-leaning market this summer.

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Trump’s Tariff Threats Stir Economic Jitters

In the first weeks of February, newly re-elected U.S. President Donald Trump reignited trade tensions by threatening sweeping 25% tariffs on Canadian goods, citing concerns over border security cooperation. For most industries, this sparked renewed fears of inflation and supply chain strain—but the real estate sector is not immune. Here's why it matters:

• Higher Costs for Building Materials: Tariffs could drive up prices for imported construction essentials like steel, aluminum, and lumber, putting upward pressure on homebuilding and renovation costs.
• Investor Uncertainty: Trade instability often translates into business hesitancy, leading to slower job growth—especially in sectors linked to exports and cross-border logistics. This can dampen consumer confidence and curb real estate activity.
• Downward Pressure on Housing Demand: If broader economic sentiment weakens or employment opportunities tighten, buyers may retreat from the market, particularly in higher-risk or investor-heavy regions

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Canada’s Political Crossroads: Liberal Leadership Vacuum and Conservative Momentum

Back at home, Canada entered a transitional phase with Prime Minister Justin Trudeau announcing his departure from Liberal leadership. As the party scrambled to organize a leadership race, the Conservative Party surged in the polls—fueling speculation about the outcome of the next federal election. For real estate stakeholders, this uncertainty raised several key considerations:

• Immigration Policy in Flux: The Liberals have long upheld aggressive immigration targets that bolster housing demand, especially in major cities. A Conservative government could pivot toward more selective or economically driven immigration policies, which may slow growth in rental and entry-level housing demand.
• Federal Housing Programs at Risk: Programs supporting first-time buyers, CMHC-backed financing, and affordability measures have been mainstays of Liberal policy. These could be scaled back or eliminated under a Conservative platform focused on market-driven solutions.

The combined impact of U.S. trade instability and shifting federal leadership is injecting a new layer of caution into the housing market. While the fundamentals remain strong in many regions, investor and consumer confidence could wobble if political volatility continues. For buyers and sellers alike, staying informed on these broader forces will be key to making smart, timely decisions in 2025.

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Buyer & Seller Outlook

Buyers:

Now is the time to be patient and focused. Inventory is climbing, prices are softening, and the urgency of past years is gone. Most properties aren’t seeing multiple offers, especially those listed above $600K—and particularly in the $850K+ range, which is leaning toward a buyer’s market.

• More time to view and revisit homes
• Less competition—rarely more than one offer
• Negotiation room is growing

That said, don’t wait forever—well-priced homes in the sub-$600K range are still moving quickly.

Sellers:

This isn’t 2021 or 2022 anymore. Buyers are taking their time, and homes are seeing second (sometimes third) showings before offers come in.

• Be priced right from Day 1
• Assume buyers will do their homework
• Market presentation—photos, staging, marketing—is critical

In this climate, properties need to stand out both visually and numerically to get traction.

Long-Term Trends: Where Are We Headed?

While seasonal lifts are always possible as we move into spring, all indicators suggest we're in a sideways-to-slightly-downward price cycle.

Mitch’s perspective:

“In historical corrections like this, it’s not unusual to see 2–3 years of price decline, followed by 2 years of flat movement before recovery. If we’re in that pattern, we may still have another full year of bottom-dragging before things lift.”

It’s been nearly three years since prices started to adjust from the 2022 peak. Recovery could still be a few years off—but that doesn’t mean there’s no opportunity. It just means being informed, strategic, and realistic is more important than ever.

Thinking of Making a Move?

Whether you’re considering a sale, planning for a future buy, or just have questions about your current property’s value—now’s a great time to get clarity.

Let’s chat about your real estate goals and make a plan that works with today’s market.

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📲 Call or Text: 705-868-7173
📧 Email: Mitch.Cleary@Century21.ca

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Take care and see you next month,

Mitch