Toronto’s Condo Reset Is Becoming an Investor Timing Test
The Greater Toronto-Hamilton Area condo market is no longer simply weak. It is becoming uneven, and that is where investors should start paying attention. When a market moves from broad paralysis to selective activity, pricing power, inventory quality, and timing begin to matter more than headlines.
According to INsauga’s report on Urbanation’s second-quarter condominium survey, new condo apartment sales in the GTHA rose 52 per cent year over year to 702 units. That is the first annual gain since 2023, supported by the elimination of HST and renewed bulk buying from investment groups.
On its own, a 52 per cent increase sounds strong. In context, it is still a deeply depressed market. Urbanation noted that second-quarter sales remained 86 per cent below the 10-year average. The market is recovering from an extremely low base, not entering a traditional upswing.
The more useful signal is where the activity is happening. Almost all of the sales improvement came from completed projects, where transactions more than tripled to 535 units. Pre-construction sales, by contrast, fell 80 per cent year over year to just 50 units. That split matters. Investors are showing more interest in tangible, finished inventory than in long-dated development risk.
This is rational capital behaviour. Completed units provide immediate visibility on rentability, carrying costs, closing risk, and resale comparables. Pre-construction units still face policy uncertainty, construction timelines, financing pressure, and the practical limits of the enhanced HST rebate, which requires qualifying projects to break ground before March 31, 2027 and be close to completion by the end of 2029.
The opportunity is not that condos are suddenly cheap. It is that the market is beginning to separate liquidity from oversupply.
Pricing shows the same divide. Urbanation reported that completed and unsold new condos averaged $1,186 per square foot, down two per cent annually. Yet newer resale condos, registered within the last three years, averaged roughly $830 per square foot. That gap is difficult to ignore. It suggests that resale may offer better entry points for investors focused on yield, while developer-held stock may require sharper negotiation to become financially compelling.
Toronto Regional Real Estate Board data also puts the broader market in perspective. The average GTA condo sold for $630,688 in June, while Toronto units averaged about $665,760. For investors, the key question is whether rents can support financing at today’s rates, particularly after condo fees, property tax, insurance, vacancy allowance, and maintenance reserves are included.
Inventory remains the pressure point. Total new and resale listings reached 12,106 units at quarter-end, only one per cent higher than a year ago. But completed, developer-held inventory rose to a record 5,001 units, up 68 per cent annually. That gives buyers negotiating leverage today, especially on units that have been sitting and on projects where developers need to clear balance-sheet exposure.
The longer-term supply picture is more complicated. Pre-construction and under-construction inventory has fallen to 48,710 units, down 37 per cent from a year earlier and 62 per cent below the 2022 peak of about 127,000 units. If projects continue to be cancelled or postponed, today’s oversupply could become tomorrow’s shortage, particularly in rental-heavy submarkets with population growth and limited purpose-built rental alternatives.
For KG Invest readers, the takeaway is disciplined selectivity. Finished resale condos with realistic pricing, strong transit access, efficient layouts, and durable rental demand deserve closer review. Pre-construction still requires caution unless the discount, deposit structure, and developer strength compensate for the risk. The market has not turned broadly, but it may be starting to offer better terms to buyers who can read the cycle rather than chase it.
Source: INsauga
