If you’ve been lurking on Toronto real estate listings lately, you’ve probably noticed something: condos are sitting longer, prices keep dropping, and suddenly that bidding war panic from 2021 feels like a distant fever dream.
So the big question everyone’s asking in 2026 is: Is this finally my chance to buy a Toronto condo at a reasonable price, or am I about to catch a falling knife?
Let’s dig into what’s actually happening in the Toronto condo market update right now, and what the data tells us about whether you should pull the trigger or keep watching from the sidelines.
The Case for “This Is Your Deal Window”
Buyers Actually Have Leverage Now
For the first time in years, you’re not competing against 15 other bidders on a shoebox-sized unit. Active listings have shot up while sales have tanked. As of January 2026, inventory levels hit 5.83 months, which is real estate speak for “this is a balanced market, not a seller’s paradise anymore.”
Translation? You can actually negotiate. You can ask for fixes. You can walk away without FOMO eating you alive at 2 a.m.
Prices Have Actually Dropped (Like, Really Dropped)
Here’s the part that gets interesting. Toronto condo prices are down roughly 9% below pre-COVID levels and about 5% year-over-year.
Even wilder? Studios and one-bedroom units are now hitting the $300,000 range in some buildings. That’s a price point that basically vanished during the pandemic insanity.
If you’ve been priced out for the last few years, these numbers might actually make ownership feel possible again, especially if you’re a first-time buyer who’s been stacking cash and waiting for your moment.
Spring 2026 Could Be the Turning Point
Market analysts are pointing to spring 2026 as a potential inflection point. With interest rates stabilizing (finally) and pent-up demand starting to build, there’s chatter that the market could see renewed activity in the warmer months.
If that happens, the deal window might close faster than you think. Nobody rings a bell at the bottom of the market.
The Case for “Hold Up, This Knife Is Still Falling”
Prices Are Expected to Keep Dropping (At Least for Now)
Here’s the cold water: the Toronto Real Estate Board projects that average selling prices will likely be lower year-over-year in the first half of 2026 before stabilizing in the second half.
So if you buy in February or March, there’s a real chance your unit could be worth less by May. That’s not fun if you need to sell anytime soon or if you’re the type who obsessively checks HouseSigma every week.
The Fundamentals Are Still Shaky
Let’s zoom out for a second. Presales have plummeted to levels unseen since the 1990s. Condo starts are at two-decade lows. Investor demand has basically evaporated because, surprise, rental yields disappeared and nobody wants to be a landlord in a falling market.
There’s also a weird mismatch happening: 60% of new units are micro studios and one-bedrooms, but only 30% of new households actually fit that buyer profile. So developers are building what investors wanted in 2021, not what actual humans need in 2026.
It’s Still Cheaper to Rent
Even with prices down, owning a condo in Toronto costs about $600 more per month than renting the same unit. And here’s the kicker: rents have actually dropped 4–6% year-over-year, making the rent-vs-buy math even more lopsided.
If you’re purely looking at monthly cashflow, renting is still winning, which means fewer buyers are jumping into ownership, which means more downward pressure on prices.
So… What Should You Actually Do?
Here’s the honest answer: it depends on your timeline and your situation.
You Might Want to Buy Now If:
- You’re planning to hold for at least 5–7 years and can weather short-term price swings
- You’ve found a unit you genuinely love (location, layout, building) and the monthly payment fits comfortably in your budget
- You’re sick of renting and value the stability of ownership over maximizing short-term returns
- You have a solid down payment (ideally 20%+) and your job is stable
You Probably Want to Wait If:
- You’re hoping to flip or sell within 2–3 years
- You’re stretching your budget to the max and would be house-poor
- You’re an investor looking for cashflow (the numbers just don’t work right now)
- You can comfortably rent and invest the difference elsewhere
The Sweet Spot? Late Spring 2026
If you’re on the fence, the smartest play might be waiting until late spring or early summer 2026. That’s when market analysts expect prices to stabilize, which means you’ll have more clarity on whether the bottom is actually in.
You might miss out on a slightly lower price in March, but you’ll also avoid the psychological torture of watching your unit lose value every month. Sometimes peace of mind is worth a few thousand bucks.
What the Experts Are Saying
Cathy Dou, Real Estate Agent and Broker of Record at BuyRealty.ca Brokerage, has been watching the Toronto housing market forecast closely. The consensus among real estate professionals is that this is a buyer’s market for those who are genuinely ready to own, not speculators or short-term flippers.
The key is doing your homework. Look at comparable sales in your target building. Check maintenance fees and special assessments (some condo boards are in rough shape financially). Factor in closing costs, land transfer taxes, and potential rate changes.
And if you’re working with an agent, make sure they’re showing you the full picture, not just the shiny listing photos.
The Bottom Line
The Toronto condo market update for 2026 is complicated. It’s not a screaming deal for everyone, and it’s not a total disaster either. It’s a market in transition, which means there are opportunities if you know what you’re looking for.
If you have a long-term mindset, a solid financial foundation, and you’ve found a place you actually want to live in (not just an investment vehicle), then yes: 2026 could absolutely be your deal window.
But if you’re chasing quick gains or stretching yourself thin to “get in before prices rebound,” you might want to pump the brakes and wait for more clarity in the second half of the year.
Either way, stay informed, run the numbers honestly, and don’t let FOMO make your decisions for you. The market isn’t going anywhere: and neither are the opportunities for buyers who do their homework.
Need help navigating the Toronto condo market? Contact Cathy Dou, Real Estate Agent and Broker of Record at BuyRealty.ca Brokerage for personalized guidance tailored to your situation.
