Experts say that the condos market in the Grand Toronto region is unlikely to wake up from its lull soon, even if other big Canadian cities see a little more promising demand.
While the supply continues to accumulate in the GTA, some say that affordability is always a key problem that prevents buyers from submitting their offers, despite the fact that borrowing costs have decreased in the past year.
“Of course, the prices have dropped … but it’s still not the night difference
“There is still many things happening where it is difficult for people to get on the market. The dollar is not as strong, the money that people earn has not increased significantly.”
Real estate observers have described 2024 as a record year for condos supplements in the region and Cowans highlights more recent figures that show a severe gap between the available inventory and the demand of buyers.
Last month, approximately 1,400 selling condominiums throughout the GTA, down 23.5% compared to March 2024, according to data from the Toronto Régional Real Estate Board. It was that nearly 5,500 new condos units hit the market, which brought total active lists in this category to almost 4,700.
The Council said that the first three months of the year had seen condos sales decreasing by a fifth compared to the first quarter of last year.
Cowans said buyers’ preferences change accordingly. With so many options there, he said that people wanted more value if they have opted for a living condo to save for a house.
“They are like:” Well, if I will pay for this, I want a bigger place, or I want the balcony to be an enveloping, I want this type of view “”, he said.
“I mean, these things were still there, but some of them in the day would be like:” Well, I would have luck if I obtained it. Now it’s no longer a request, like: “I must have it”. What was pleasant to have was suddenly to become essential. »»
Get daily national news
Get the best news of the day, the titles of political, economic and current affairs, delivered in your reception box once a day.
Canada Mortgage and Housing Corp. provides that the construction of new condominium apartments will probably slow down this year in Ontario due to lower resale and rental markets, which have also contributed to the decline in the demand for pre-construction units.
“The GTA would probably be the worst market (Condo) in Canada at this stage, given the demand for investors, which has now disappeared, and the quantity of supply that arrives on the market,” said BMO’s main economist Robert Kavcic, adding a large part of South Ontario similar trends.
He said that the GTA had strong pre-construction purchases via the pandemic until the beginning of 2022, which led to record units at the time which were only finished.
“It is a similar story everywhere, because everywhere in Canada, to a certain extent, has faced very strong population growth,” said Kavcic.
“But in Toronto, the fundamental problem is that a large part of this pre-construction activity was belonging to investors. And what does the investor do now? They wanted to go back to the completion for a gain in equity, but they can no longer do that … It is a much more difficult environment.”
At the other end of the spectrum is Montreal, where condos sales increased by more than 15% in March and almost 17% more for the first quarter, according to the real estate council which monitors activity throughout Quebec.
The median price of one unit, up 5% in March compared to last year, remains relatively affordable at $ 420,000, against an average price of $ 682,000 in the GTA.
“I think the reality is that the market has never become too sparkling. It was always relatively affordable,” said Kavcic.
“Now interest rates have dropped and this market reacts almost as you would normally expect during an interest rate cycle,” he said.
The condos market in other cities like Calgary also works better, he said, while people leave Ontario to take advantage of its affordability.
The Calgary Real Estate Board said that although condos sales from one year to the next have dropped approximately a third last month, the 1,383 sales of this category of property so far in 2025 are “much higher than long -term trends in the first quarter”.
The large Vancouver region is somewhere between the two.
Although the condos sales ratio with active lists in the GTA is around 60% below the long -term average, it is about half that of the Vancouver region, said a report last month by economist TD Rishi Sondhi.
“This indicates a much greater excess degree of excess in the GTA condos market,” he said, noting that the Vancouver condos market is not confronted with an inadequacy of the supply of the offer.
Sondhi has said that condos construction is better resistant to Vancouver, probably supported by the demand for ownership which has been more resilient in recent years.
But Vancouver broker, Randy Ryalls, said that condos developers recognize the difficult economic environment and that “everything that does not have to be built is not under construction”.
“So far this year, it is sure, there has not been the number of units published on the market we probably expected,” Ryalls of Royal Lepage Sterling Realty said.
“Many of them keep their things on the shelf as long as they can,” he said.
Condos sales in the region were down approximately 10% last month that they were not in March 2024, because the reference price of these properties was $ 767,300, a drop of 0.9% from one year to the next, according to the largest real estate agents in Vancouver.
Vancouver buyers have the choice and take their time to go around, said Ryalls, attributing the lack of emergency to many units being always outside the price range, which prompted developers to offer incentives.
Those who can afford a property probably look at “mom and dad’s bank” to make a deposit, he said.
But Ryalls wondered if the gap between supply and demand could be prevented in the coming years, with the Toronto-Condo market.
“The bad news is that there are no new ones under construction,” he said.
“So, in two years or three years, when we emerge, if this is what the delay is, there will be no new product.”