Toronto Condo Price Drop: Average Unit Expected to Lose $43,000 in Value in 2026

The Royal LePage Market Survey Forecast anticipates the steepest declines will be concentrated in the condominium segment.

The Toronto real estate market, which saw significant cooling throughout 2025, is projected to decline further in the new year, according to the latest forecast from Royal LePage. The new data suggests welcome news for prospective buyers who have been patiently waiting for the market frenzy to subside.

The Forecast: Condos to Lead the Decline

The Royal LePage Market Survey Forecast, released Tuesday, projects modest decreases in the average home price across the Greater Toronto Area (GTA) through the end of 2026. The heaviest impact is expected to hit the condo segment.

The projected 6.5% decline for condos translates to an average loss in value of approximately $42,815 for owners.

Drivers of the Downturn: Uncertainty and Oversupply

Shawn Zigelstein, broker and leader of Team Zold at Royal LePage, described the fall market as “more of a whisper than a roar,” noting that intense competition has vanished. He attributes the current sluggishness to several converging factors:

1. Buyer Hesitation: Buyers are attempting to “time the best deal,” compounded by ongoing economic uncertainty regarding job security, investments, and trade tariffs. Buyers are moving with “far more caution than we saw just a few years ago.”

2. Condo Inventory Crisis: The market is facing a record supply of new condos set to be completed over the next 18 to 24 months, a result of the pre-sale boom during the pandemic’s low-rate environment. This high inventory is placing significant downward pressure on prices, particularly for smaller units. Zigelstein noted that while larger units for families are selling, “We’re having a difficult time in the market right now with studio apartments, small one bedrooms.”

3. Return-to-Office (RTO) Mandates: Increased requirements for in-office work have created confusion. Prospective buyers who moved outside the city during the pandemic may rent first to evaluate their new commute and decide if they truly wish to uproot their lifestyle to buy closer to the city core.

Opportunities and Outlook

Despite the doom and gloom, Zigelstein stresses that the “softer competition is creating meaningful opportunities.” There has been a year-over-year increase in transactions for freehold properties priced under $1 million, suggesting that some buyers are capitalizing on the current conditions.

For the near future, a flat market is expected this winter. While the GTA has already seen its 10th consecutive month of year-over-year price declines, Zigelstein cautions that any recovery will be gradual. “A recovery will probably build gradually as confidence improves, economic signals stabilize, and buyers begin to feel more secure in making long-term decisions.”