Condo buyers sat out Toronto’s market in November, deepening a downturn that has already rattled investors and developers.
Sales in the 416 core fell 21.8% year over year to 880 units, while transactions in the surrounding 905 dropped 21.4% to 419. That total of 1,299 condo sales was 21.7% lower than a year earlier.
Average prices also slipped, down 1.7% in the 416 to $701,259 and 8.7% in the 905 to $583,578, for a GTA-wide condo average of $663,290 – 3.8% below last November.
The weakness came against a broader slowdown. Across all home types in November, GTA sales fell 15.8% year over year and the average selling price dropped 6.4%, according to the Toronto Regional Real Estate Board.
Condo sentiment turned sharply negative
The data reflects a deeper reset in how Canadians view the condo asset class. Thirty-five percent now believe condos are no longer a good investment, up five percentage points from March 2025, according to a Leger survey commissioned by Rates.ca.
Only 17% said condos had always been a good investment, down from 22% earlier in the year.
“Investor appetite has diminished in the current economic environment, leaving demand primarily driven by owner-occupants who typically seek larger, more functional spaces than smaller condos provide,” said Steven Yanni, managing broker at HouseSigma.
Younger buyers, though, view the same conditions as an opportunity. Among Canadians under 35, 39% said they would consider purchasing a condo, compared with 27% of those over 35, the survey found.
A fragile opening for first-time buyers
“First-time homebuyers have more choices, stronger negotiating leverage, and improved affordability after multiple Bank of Canada rate cuts,” said Clara Leung, real estate broker and mortgage agent at Swivel Mortgages.
“Many are using this window to get into the market and to build equity.”
New federal rules that raised the insured mortgage cap to $1.5 million and extended amortizations to 30 years for new builds, along with Ontario’s 8% HST rebate on homes under $1 million, are touted by brokers as potentially delivering more than $130,000 in combined savings for some borrowers.
Still, affordability remains a stumbling block even as prices fell. “I feel like affordability still seemed to be a lot of concern for the first-time homebuyers,” DLC Clear Trust mortgage broker Micky Khaneka told Canadian Mortgage Professional.
“Even with lower rates, for the people who were most interested, unfortunately when you threw the stress test on there, there was still a relatively high payment. Especially if it was a single individual earning an average salary of $60,000 to $80,000 or $90,000,” he said.
Small “dog crate” units bore the brunt
Khaneka said many investors have been left with cramped, hotel‑sized studios that today’s renters no longer wanted. Those units, he added, are “just not rentable” except to a narrow slice of single professionals, leaving “an oversupply of a specific type of units downtown.”
Toronto’s condo slump has been described a “perfect implosion” in the small‑unit segment, with investors unable to close as appraisals came in below preconstruction purchase prices and rents slipped.
Canada Mortgage and Housing Corporation’s deputy chief economist, Aled ab Iorwerth, recently told CMP he was watching Toronto closely but did not yet see delinquencies at crisis levels, even as they climbed to their highest point since 2012.
He warned that plunging apartment starts could leave the city “back in a shortage” three or four years from now as today’s projects are completed and little new product replaces them.
CMP
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