Overbidding on Homes is Rising in These Greater Toronto Area Neighbourhoods
While home sales remain slow, certain neighbourhoods in the Greater Toronto Area (GTA) are experiencing a surge in overbidding activity.
According to a new report from digital real estate platform Wahi, some homebuyers engaged in bidding wars in February, pushing up prices in select areas.
Overbidding Activity on the Rise
The percentage of GTA neighbourhoods in overbidding territory nearly doubled between January and February, Wahi reported. In February, 51 neighbourhoods (20%) with at least five home sales saw homes selling above asking price, up from 26 (11%) in January. This marks the highest level of overbidding since June 2024, when 82 neighbourhoods (27%) experienced bidding wars.
However, despite this increase, the overall market remains subdued. In February, 194 neighbourhoods (77%) were still in underbidding territory, meaning most homes sold below the asking price. Another eight neighbourhoods (3%) had homes selling at the listed price.
“The rise in bidding activity is encouraging, but fluctuations like these are common ahead of the traditionally busy spring homebuying season,” said Wahi CEO Benjy Katchen.
In 2023, a similar trend emerged, with the percentage of overbidding neighbourhoods jumping from zero to 25% between January and February.
Market Conditions Favor Buyers
Despite signs of increased competition, buyers still hold the upper hand in the market. The average selling price of all home types in the GTA was $1,084,547 in February, a 2.2% decline compared to February 2024, according to the Toronto Regional Real Estate Board.
The median home price in February stood at $940,000, down 4% from the previous year. Unlike average prices, median prices are less affected by extreme highs or lows, offering a clearer picture of the market.
Home sales also remained sluggish, with only 3,977 transactions recorded in February—a steep 30% drop from the same time last year.
Single-Family Homes vs. Condos
Most homes (65%) still sold below asking price, though this was down from 74% in January. Single-family homes, including detached, semi-detached, and townhouses, saw the most competition, with 39% selling above asking price—a notable jump from 26% in January.
Condos, on the other hand, remained a buyer’s market. Less than one in five (19%) sold above asking price in February, compared to 16% in January.
“For now, it’s a tale of two markets in the GTA,” said Katchen. “Competition for single-family homes is strong, while condo demand remains weak. Moving forward, we’ll be watching whether external factors like U.S. tariffs impact homebuyer plans.”
Overbidding vs. Underbidding in the GTA
Wahi clarified that a neighbourhood in overbidding territory doesn’t mean every home is selling above asking price or that buyers are overpaying. Instead, it reflects market trends influenced by factors such as seasonal demand and strategic pricing by sellers looking to attract bids.
At the end of each month, Wahi analyzes median list and sold prices to determine overbidding or underbidding trends, excluding neighbourhoods with fewer than five transactions.
In February, 253 GTA neighbourhoods met this threshold, up from 236 in January. Data was sourced from Information Technology Systems Ontario and the Toronto Regional Real Estate Board.
For a detailed breakdown, check out the full Wahi report.
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