Toronto Condo Market Tightens; Listings Dip and New Construction Slows

Toronto’s condominium market has taken a complex and somewhat counterintuitive turn this fall. While broader housing inventory levels across the Greater Toronto Area (GTA) remain high, an October Edge Realty Analytics report reveals that the condo segment, especially within the City of Toronto, is not following the same trajectory as detached and single-family homes. Instead, it is showing an unusual mix of elevated long-term inventory pressure, falling prices, and a lull in new listings.

A Surprising Dip in Active Condo Listings

After months of headlines warning of oversupply and growing seller anxiety, September data showed that active condo listings in Toronto’s core actually declined year-over-year, which was a notable contrast to the rest of the market. Active listings across the GTA remain near record seasonal highs, up 18.9% from last September. However, the 416 condo market broke from that trend, recording a year-over-year decline in listings, for an unexpected shift that may suggest potentially changing seller behaviour.

According to the Edge report, this decline may suggest that some of the “panic selling” feared earlier in the year has not materialized. Sellers may be holding back, either due to the rentability of units or reluctance to accept current price levels. Meanwhile, the traditional September inventory buildup that typically occurs was far more visible among single-family homes than condos.

Despite this dip in listings, the months of inventory (MOI) for condos still reached 6.4; while lower than last year’s number, this remains elevated historically. In simple terms, there are still more condos available for sale than buyers actively ready to purchase them, keeping conditions firmly tilted toward a buyer’s market.

Prices Under Pressure Despite Tightened Market Balance

Even as listings pulled back slightly, the broader pricing story for Toronto condos remains soft. Condos continue to lead price declines across all housing segments, with the MLSⓇ Home Price Index (HPI) for condos down 8% year-over-year.

There are, however, small signs of stabilization in market activity. GTA-wide home sales rose 2% month-over-month on a seasonally adjusted basis, with demand improving modestly across all property types, including condos. This lifted the sales-to-new listings ratio from 36% in August to 38% in September, indicating a slightly tighter market balance.

Completions vs. Starts

The near-term dynamics that produced a dip in Toronto’s active listings look temporary when considering the development pipeline. A run of high completions over the next four to six quarters is now coming to market. Those completions will add to resale and rental inventory.

However, at the same time, the activity behind future supply is weakening. The number of condo dwellings under construction fell 3.1% month-over-month in August and 16.4% year-over-year, a marked six-month decline that indicates fewer new starts will be entering the pipeline after the current completion wave subsides. The current situation of heavy near-term completions will be followed by fewer new projects and a thinner flow of new inventory in the future.