Mo Realty Team · Market Intelligence Report

The GTA Condo Reckoning
Inside the 35 Year Low

New condo sales have fallen to their lowest level since 1991, most investors are losing money every month, and unsold inventory sits at a record high. Yet the pipeline that replaces this supply has already stopped. Here is what the data actually says, and why the next three years may look nothing like the last three.

Coverage: 2022 to 2029 Geography: GTA · GTHA Source: TRREB · Urbanation · CMHC Published: August 2026
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The Collapse: A Market That Stopped Selling

The most common mistake in condo coverage is treating this as a comedown from an inflated pandemic peak. It is not. GTHA new condo sales fell to 1,599 units in 2025, the lowest annual total since 1991. Compare that to 25,097 units in 2019, the last full year before the pandemic and the third highest year ever recorded. Sales today are roughly 94% below a normal pre pandemic year, not 94% below a bubble.

2025 New Condo Sales
1,599
Lowest since 1991, down 60% from 2024
vs 2019 (pre pandemic)
−94%
25,097 units sold in 2019 vs 1,599 in 2025
Projects Cancelled 2025
7,243
28 projects, more than double 2024
Condo Starts 2025
3,272
Down 63% in one year, 88% over three
GTHA New Condo Sales vs the Pre Pandemic Norm, 2017 to 2026
Bar colour shows market condition. The dashed gold line is the long run average, roughly 16,400 units a year.
Normal or strong market
Weakening
Below any modern precedent
Long run average
New condo sales were 35,000 in 2017 and 25,097 in 2019, then fell to 1,599 in 2025, roughly 94% below the pre pandemic level.
Source: Urbanation. Reported figures: 2017 (~35,000, a record), 2019 (25,097), 2025 (1,599), Q1 2026 (246). Values for 2022 to 2024 are approximate, derived from reported year over year changes. 2026 is annualized from Q1 and Q2 activity.
This is not a pandemic hangover. It is easy to assume condos are simply giving back pandemic era excess, and that once the froth clears things normalize. The data does not support that. Sales are not below the 2021 peak, they are far below 2017, below 2019, and below every year since 1991. And they got there while the region added more than a million people. In 2019 the GTA sold about 25,100 new condos to a region of roughly 6.2 million. In 2025 it sold 1,599 to a region of roughly 7.1 million. More people, less housing being sold, and almost none being started. There is no modern precedent for this combination.
Why the presale model broke: New condo construction is funded by presales. A developer typically needs roughly 70% of units sold before a lender will finance the build. That model depended almost entirely on investors, and investors bought on the assumption that rents and prices would keep rising faster than carrying costs. When rates rose and that assumption failed, the buyer of last resort simply left the market. No presales means no financing, which means no starts, which is why 28 projects were cancelled outright in 2025.
The resale market absorbed the overflow. In July 2026 there were 4,190 new condo listings across the TRREB area against roughly 1,600 completed sales, about 2.6 listings for every sale, with 8,352 active listings at month end. The average GTA condo sold for $636,323 in July, down 2.3% from a year earlier, after touching $665,760 in June, down 9.0% year over year.
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The Investor Math Stopped Working

The single clearest explanation for the condo downturn is not sentiment. It is arithmetic. Roughly 77% of Toronto investors holding a mortgage on a new condo are cash flow negative, losing an average of $597 every month. Carrying costs climbed about 24% while rents rose only 15%, and rents are now falling, so the gap is still widening.

Investors Losing Money
77%
New condo mortgages, cash flow negative
Average Monthly Loss
$597
Out of pocket, every month
Carrying Costs vs Rents
24% / 15%
Costs rose far faster than income
Toronto 1 Bed Rent
$1,993
Down $156 year over year
Why the Investment Case Broke: Costs vs Rents, and Who Is Underwater
Left: cumulative growth in carrying costs versus rents. Right: share of new condo investors by cash flow position.
Carrying costs
Rents
Cash flow positive
Carrying costs rose 24% while rents rose 15%. 77% of new condo investors are cash flow negative, 23% are positive.
Source: CMHC and Urbanation investor cash flow analysis; Toronto rental data as of early 2026. Figures describe investors holding a mortgage on a newly completed condo.
The feedback loop: An owner who cannot sell without crystallizing a loss rents the unit instead. That adds supply to the rental market, which pushes rents down, which deepens the monthly loss for every other investor. Condo apartment rents fell roughly 5.7% year over year nationally, and Toronto one bedroom rents dropped $156. Falling rents and falling prices reinforce each other, which is precisely why this correction has lasted longer than most people expected.
The gap nobody talks about: While condos corrected hard, freehold held up far better. In the first quarter of 2026 a 416 detached home averaged roughly $1.61M against about $649K for a condo, the widest spread ever recorded between the two. For anyone who bought a condo intending to trade up to a house later, that ladder has become materially harder to climb, and it is the strongest argument for treating condos as a lifestyle purchase rather than a stepping stone.
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The Supply Cliff: Today's Glut Is Tomorrow's Shortage

Here is the part most coverage misses. The market is oversupplied with finished units right now, with a record 4,295 completed and unsold condos and roughly 92 months of standing supply. But nothing is being built behind them. Completions fall to about 22,066 units in 2026 and 14,366 in 2027, and Urbanation expects virtually no new condo completions in the GTHA by 2029.

Completed & Unsold
4,295
Record high, roughly 5x two years ago
Standing Supply
92 months
At the current pace of sales
Pipeline Q2 2026
48,710
Down 37% in a single year
Completions by 2029
~0
Urbanation forecast for the GTHA
Condo Completions, Actual and Forecast, GTHA
Bar colour reflects supply conditions: teal is healthy delivery, amber is thinning, red is a shortage.
Healthy delivery
Thinning
Shortage
Completions fall from roughly 29,000 in 2025 to 22,066 in 2026, 14,366 in 2027, and near zero by 2029.
Source: Urbanation completions forecast. 2026 (22,066) and 2027 (14,366) are published forecasts; 2028 and 2029 reflect Urbanation's guidance that virtually no completions are expected by the end of the decade. 2025 is approximate.
Why this matters more than the glut: A condo takes roughly four to five years to go from launch to keys. That means the units delivering in 2029 and 2030 needed to be selling right now, and they are not. Even if demand recovered tomorrow, the supply response is already years away. Toronto is currently working through a surplus of finished product while quietly guaranteeing a shortage at the other end.

What this means, depending on who you are

If you are buying to live in it
Best window in years
Record standing inventory, motivated sellers, and real negotiating room, especially on completed units in buildings with unsold stock. You are buying into weakness while the future supply picture tightens. Take your time, negotiate hard, and prioritize the building and the floor plan over the discount.
If you already own one
Selling into this market means competing with 8,352 active listings and, in many buildings, with the builder's own unsold units. If you can hold and carry it comfortably, time is on your side given the completions cliff. If the monthly loss is straining you, that is a cash flow decision, not a market timing one, and it deserves an honest conversation.
If you are an investor
Assume negative cash flow and underwrite for it. The units that work are the ones with genuinely low carrying costs, not the ones with the biggest headline discount. Preconstruction carries real completion and appraisal risk right now. Completed resale with a known fee structure is the safer path into this cycle.
If you are a downsizer
This is arguably the strongest position in the market. You are selling a freehold home near record relative strength and buying into the weakest condo market in a generation. That spread, roughly $1.61M against $649K in the 416, is the widest it has ever been, and it works in your favour on both sides of the trade.
What would change our mind: Three things would signal the bottom is in. First, standing inventory falling for two consecutive quarters. Second, rents stabilizing, since the investor math cannot repair itself while rents fall. Third, actual project launches returning, which is the market telling you developers believe buyers are back. Until at least two of those turn, patience is still the right posture.
The Outlook

What Happens Next: 2026 to 2029

A report that only says the market is bad is not much use to anyone making a decision. So here is our honest read on where this goes. The condo market has two clocks running in opposite directions: a demand clock that is still weak, and a supply clock that has already stopped. The question is not whether they cross, it is when.

2026 to early 2027 · The grind
Flat to slightly down
Standing inventory of roughly 4,300 finished units still has to clear, and completions of about 22,000 arrive this year on top of it. Expect continued softness, more incentives, and slow price discovery. This is the phase where patient buyers get the best terms, because sellers are still competing with builders.
Late 2027 to 2028 · The turn
Balance returns
Completions fall to roughly 14,400 in 2027 and keep dropping. The overhang thins, rents stabilize as fewer new units arrive, and investor math starts working again at lower price points. This is where the market likely stops falling, though a sharp rebound is unlikely this early.
2029 onward · The squeeze
Supply shortage
Urbanation expects virtually no new condo completions in the GTHA by 2029. Nothing meaningful has been started to change that, and a condo takes four to five years from launch to keys. A growing region with almost no new supply is the classic setup for renewed price pressure.
So could there be a rebound? Probably, but not the way people expect. A rebound will not come from a burst of enthusiasm. It will come mechanically, from supply exhaustion meeting a population that keeps growing. That is why the timing is more predictable than usual: we already know how many units complete in 2027 and 2028, because they are already under construction. What we do not know is exactly when demand returns, and that depends mostly on rates and rents.
The honest risks. This is not a guaranteed recovery story. If rates stay higher for longer, if immigration levels are cut further, or if a recession hits employment, demand could stay weak well past the point where supply tightens, and the squeeze simply arrives later. Rents are the number to watch. Until rents stop falling, the investor math cannot repair itself, and investors were the buyer of last resort that built this market in the first place.

If you have been waiting on the sidelines

The uncomfortable truth about buying near a bottom is that it never feels like a bottom. It feels like catching a falling knife, because the news is still bad and prices are still soft. What you can control is not the timing, it is the terms. Right now buyers have leverage they have not had in fifteen years: real inventory to choose from, sellers who need to move, and almost no competing bids. That leverage disappears the moment sentiment turns, and it disappears long before the supply cliff actually arrives.

Our practical read: if you are buying a home to live in for five years or more, this is a genuinely favourable window, and waiting for the exact bottom is likely to cost you more in lost negotiating power than it saves in price. If you are buying purely as an investment, be patient and underwrite conservatively, because cash flow is still negative in most buildings and that will not fix itself until rents stabilize. And if you are selling a freehold to move into a condo, the spread between the two has never been wider in your favour.

Does a condo actually make sense for you?

The market view is one thing. Your numbers are another. Send us the building or the unit you are considering and we will run it properly: real carrying costs including fees and taxes, what it would rent for, the break even, and how it compares to waiting another year. If the answer is that it does not work, we will tell you that too.

Run My Condo Numbers