GTA Real Estate 2026: Average Prices Dip Below $1 Million

Prices Fall 22% in Four Years to Under $1 Million

• The market softness seen throughout most of 2025 carried into the first month of 2026 as sales were impacted by typical post-holiday sluggishness combined with two major snowstorms, ongoing economic concerns, and hopes for further price declines. With interest rates on pause, buyers are looking for better deals to improve affordability. Current market indicators suggest that prices, which declined to a five-year low in January, will continue to fall back towards pre-COVID levels in the coming months.

• Sales Fall 33% Below 10-Year Average: Total MLS sales in January declined for the fourth month in a row, decreasing 19% year-over-year to 3,082 transactions. Furthermore, the 16% monthly decline in activity was one of the largest drops ever seen between December and January periods. Sales last month fell 33% below the 10-year average and were at their lowest January level since 2009 during the Global Financial Crisis. The latest 12-month rolling total of 61,654 sales represented a 25-year low.

• New Listings Decline from Record High: New listings backed off from their record high last year, decreasing 13% to 10,774 homes — the largest annual decline in nearly three years. Still, new listings last month were 15% higher than the 10-year average. Active listings on the market continued to accumulate but at a reduced pace compared to previous months, rising 8% annually to 17,975 homes and climbing 83% higher than the 10-year average.

• Market Conditions Heavily Favour Buyers: Despite fewer new listings and a slower rate of inventory growth, market conditions continued to weaken during January. At 29%, the ratio of sales-to-new listings fell to one of its lowest levels on record and substantially below a balanced level of 45-60%. The 5.8 months of supply on the market was almost 2.5 times higher than the 10-year average.

• Average Prices Below $1 Million for First Time in Five Years: Average selling prices fell below the $1 million mark for the first time in five years. At $973,289, the average price in January was down 6.5% annually, representing the 12th consecutive month of annual decline. Prices have fallen 22% over the past four years, while still managing to average annual growth of 5% during the past 10 years.

• Condo Sales Drop 42% Below 10-Year Average: Double-digit annual sales declines were recorded across all housing types in January, with condo apartments leading the way with a 26% drop, pushing activity 42% below the 10-year average. Detached sales fell 14% from last year to 1,352 homes, which was even lower than during the onset of COVID-19 in April 2020 (1,502 sales) and 31% below the 10-year average. Sales for semis/rows/towns declined 22% annually and were 28% below the 10-year average.

• Active Condo Listings Levels Out: For the fifth month in a row, new condo listings declined on an annual basis, falling 19% in January. This helped to level-out active listings for condos, which were unchanged from a year ago but still at a record high of 6,666 units. Active listings for both detached homes and semis/rows/towns were at their highest levels since 2009, rising 14% and 13%, respectively, from last year.

• Condo Supply Reaches Nearly 8 Months: Weak sales and elevated inventory pushed the months of supply for condo apartments up to a record-high 7.8 months — more than doubling over the past two years. Months of supply for detached homes rose to 5.6 months, while remaining more balanced for semis/rows/towns at 4.3 months.

• Low-Rise Prices Fall to Six-Year Low: The 10% annual drop in average condo prices was the largest in almost three years, causing prices to fall to a five-year low of $604,759. Average detached prices decreased 7% annually and by a total of 26% in the past four years, falling to a six-year low of $1,277,915. The 9% annual decline for semis/rows/towns also brought average prices down to a six-year low ($861,887), with a total decrease of 25% from the market peak in 2022. Condo prices have held up best in the past four years with a 19% decline.

• More than One-Third of Condos Under $500K: Over one-third (35% share) of all condos sold for less than $500K in January, more than twice the 17% share from a year ago. This occurred as sales volume for condos under $500K grew 53% year-over-year. All other price ranges for condos experienced reduced market share and sales volume.

• More than 40% of Low-Rise Homes Under $900K: Market share for low-rise homes increased for all price ranges under $900K, which together represented a 42% share of sales in January — up from a 30% share last year. Low-rise activity under $600K more than doubled but comprised only 6% of sales. The highest concentration of low-rise sales was between $1.0 and $1.249M at a 21% share, down slightly from a 23% share last year but supported by an increase in the price limit for mortgage insurance from $1.0 to $1.5M.

• Low-Rise Supply Lower in 905 than 416: Months of supply in January was slightly lower in the 905 than in the City of Toronto for detached homes (5.4 vs. 5.6) and semis/rows/towns (4.2 vs. 4.5). However, condos had higher months of supply in the 905 than in Toronto (8.1 vs. 7.6).

• Toronto Prices Holding Up Better than in 905: Average prices experienced much smaller annual decreases in the City of Toronto compared to the 905 for detached homes (-3% vs. -9%), semis/rows/towns (-4% vs. -12%) and condos (-9% vs. -13%). Average prices for detached homes in Central Toronto and semis/rows/towns in Toronto West decreased by only 1%.

Key Takeaways

• While it’s difficult to read too much into January data as it generally represents one of the slowest months of the year for housing activity, it was evident that momentum continued to wane during the first weeks of 2026. The snowstorms and freezing temperatures gave more reason for hesitant homebuyers to stay on the sidelines, waiting in anticipation of further price cuts and more inventory arriving in the spring.

• Market balance indicators reveal very favourable conditions for buyers, which are expected to place some further downward pressure on prices. However, after a more than 20% correction in the past four years, prices are likely close to their bottom. While listings are projected to remain high this year, there is little evidence of distressed selling, even as a record number of mortgages renew at higher rates.

• On January 28, the Bank of Canada held its key interest rate at 2.25% for the second consecutive meeting, noting heightened uncertainty around the economic outlook given the upcoming review of the Canada-US-Mexico Agreement on trade. Even though economic growth has been slow, the Bank of Canada has been warning of the risks to lowering interest rates in an environment of reduced supply capacity caused by trade restrictions and population decreases. Raising demand by lowering rates could result in a much stronger than normal increase in inflation, which is something the Bank wants to avoid.

• Given that interest rates will likely remain on hold, and some economists are projecting that rates could begin to increase later this year, some further price concessions could be the spark that motivates buyers back into the market in the coming months.

• First-time buyers appear to be active already, taking advantage of condo prices under $500K and low-rise homes under $900K. This is the foundation of a broader market recovery that will assist sales in moving up the supply chain. Condo buyers with at least a five-year time horizon should be rewarded with price gains as condo completions trend down to virtually zero by 2029.