Toronto New Condo Prices Drop Over $20k In Just A Month

Greater Toronto new home data is mixed, showing some improvements as well as flags. Altus Group data shows new home sales across the region ripped much higher in April. The rise in new home sales were likely helped by improvements to prices. The price of a typical new single-family home is down from last year, and condos fell from the all-time high hit earlier this year.

Detached Prices Are Down, Condos Decelerate In Growth

The price of a typical new home made a mixed movement last month. The single-family home benchmark reached $1,119,772 in April, down 0.3% from last year. The condo apartment benchmark reached $758,585, up 2.5% from last year. Both markets didn’t change all that much from last year, but the monthly details are worth diving into.

Greater Toronto New Home Sales

Total April new home sales in Greater Toronto.

Source: Altus Group, Better Dwelling.

The monthly price change bucked the annual trend in both segments. Single-family prices were up 0.28% from the month of April, which works out to an increase of ~$3,132. Condo apartment prices dropped 2.85% from the month before, dropping about $22,254 in value over a month. For single-family homes, this is the first monthly improvement since November 2018. Condo apartments have slid for 4 consecutive months now, shedding about $45,053 in value since prices peaked in January.

A Big Jump In York Region Helps To Push New Home Sales Higher

Lower prices and last year’s weak sales made for an easy beat this year. There were 3,853 new homes sold in April, up 122.6% from last year. The City of Toronto represented 1,097 of those sales, up 69.8% from last year. A huge jump from last year, but still 1.41% from the median 10 year number for the month. Sales were still down from 2017, especially in Toronto.

Greater Toronto New Home Sales

Total new home sales in Greater Toronto for April, by region.

Source: Altus Group, Better Dwelling.

Condo apartments made a similar move, but they’re better than average for the month. There were 3,053 new condo apartment sales in April, up 137.03% from the same month last year. The City of Toronto represented 1,043 of those sales, up 64.51% from last year. Sales are 0.7% from the 10 year median for the month, so they’re about right where they should be. Sales of condos are still down from 2017. Something to consider, since inventory is much higher these days.

Greater Toronto New Home Inventory Is Building Higher

There’s more new home inventory for sale in Greater Toronto. There were 18,287 new homes for sale in April, up 27.90% from last year. Condo apartments represented 13,707 of those listings, up 37.65% from last year. Unfortunately, new listing inventory isn’t broken down by region.

Sales rising faster than inventory improved the sales to active listings ratio (SALR). The SALR reached 21.07% in April, a big climb from 12.11% last year. When the ratio is above 20%, the market is a seller’s market – where prices are expected to rise. Below 12% is a buyer’s market, and prices are expected to fall. Between 12% and 20%, and the market is considered balanced – prices are just right. The ratio is a far from perfect measure, and this is the first time since October we’ve seen it above 20%. Alway best to use this number as a starting point, and make sure it isn’t just making a brief visit to the market type.

Greater Toronto New Home Sales To Active

The ratio of sales to active listings for new homes in Greater Toronto, for the month of April.

Source: Altus Group, Better Dwelling.

Last month the market was very mixed, with a lot of positive indicators as well as warning flags. Sales were higher across all segments, and were at more typical levels. Single-family home prices showed negative annual growth, but a positive climb for the month. Condo apartments made the opposite price move, positive on the year, lower on the month. The last one is one of the biggest takeaways, considering the size of the monthly drop.

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  • Reply
    MM's Mom 5 years ago

    Oh look, no one wants to comment on how the BD comments are always so negative with bears, that refuse to see prices will always rise?

    • Reply
      MM's Dad 5 years ago

      Don’t worry Dear, our son will be here any minute to make us proud. He’s our sweet, chubby little real estate tycoon after all… I just want to grab his cheeks and pinch them forever.

    • Reply
      carlton 5 years ago

      Did you read the article? At least read the headline please…..

      “Toronto New Condo Prices Drop Over $20k In Just A Month”

      • Reply
        MM's Dad 5 years ago

        Don’t talk to my wife like that. My son will be here shortly to teach you a lesson. You won’t believe how cute and chubby and smart he is.

  • Reply
    Ethan Wu 5 years ago

    Interest problem. If condos do correct, I wonder how appraisals for the units work. With detached homes, the bank appraisal hasn’t been meeting the purchase price in some projects. Homeowners need to “top up” the deposit, or find a private lender for those to execute. A large part of why private lenders have become prevalent.

    • Reply
      Rob 5 years ago

      Yes interesting problem, especially in Vancouver. If you buy a unit today and wait for it to be built and when its ready a year or later, what happens if the assessment is less then what you agreed to pay.

  • Reply
    Sheep Herder 5 years ago

    Anecdotally I’ve been getting a lot more marketing material with incentives, so who knows what that does to skew prices as well.

    The premiums that builders are trying to charge for new build only make sense if the market believes that prices will continue rising. Otherwise, why pay more for something that is being delivered in future with risk being borne by the buyer (interest rate rising risk, market pricing risks etc)?

    Should be interesting to see what happens if developers start having to discount their products and what that will signal to the general buying public (sheep).

  • Reply
    cto 5 years ago

    Interesting how no one even bothers commenting on Vancouver anymore. Sales crashing into the basement. Just like roadkill, nothing more to see here, say nothing and turn your head.
    “Blowoff Phase”
    The blowoff phase. The decline in price will start off slow; it may even increase a bit after an initial selloff. But as the selloff speeds up because of uncertainty and fear, so does the price decline of the asset.

    • Reply
      Trader Jim 5 years ago

      Yup, noticed that too. The immigration will prop it up crowd completely vanished. 😂

    • Reply
      Joseph 5 years ago

      Agreed, Cto. Those who realize this, get out earlier than others. Once the majority sees the snowball gaining mass and speed as it rolls, it’s already too late. They try and sell, but in the end, become the extra mass themselves.

      I believe it’s the point where Vancouver is at right now. Everyone throwing their houses/condos on the market to try and get even. The extra houses/condos thrown on the market bring the prices even further down.

      Somewhat equivalent to a slots player at a casino who puts $60 in a machine and wins $100 on their first 60 cent bet. They think they’ll continue winning. As their $100 starts going on a downward slope, they win a 10 or a 15 spot here and there. But in the end, they’ll eventually have only $20 left. At that point, they simply want to win $40 to get back even to the $60.

      Sometimes, they get back to the $60, or, even win another $100 with almost no money left. But the majority of the time, that last $20 turns to zero.

      Some slots players, insanely, start feeding the machine even more money, trying to get the $100 win again. It just never ends well.

      The majority of home/condo owners in Vancouver are at this point. Throwing their extra money in the slots machine. They’re willing to take a loss, just to try and get something in return.

      In their minds, alot can only think of the crazy prices their houses/condos were at 2 1/2 years ago. It’s hard to get your head wrapped around a loss. It’s the psychological side of it. It’s the toughest part of it all. They can’t comprehend that they could have made a 2 mil profit a little while back, yet now might make nothing on their place.

  • Reply
    Rana 5 years ago

    Smart persons like my buddy MM will buy and rent them out ultimately market will become stable

  • Reply
    DB 5 years ago

    back in the early 1990,s my father in law put his house up for sale we all knew he was getting desperate and needed to get out but he had always believed his idiot realtor who was always telling him what he wanted to here…such a nice house,,,it’s worth such and such amount,,,,what a load of crap…!
    he was all way’s about 20 to 30 grand over valued, back then that was a lot of money and made quite a difference to the buyer who was able to find better deal. He had to cut his prices several times before coming to his senses and dumped the house to get out from underneath it…so instead of taking the major hit the first time and get it gone in 3 months he took a year….when you have decided to cut and run for the exit do just that. RUN…no time to walk here.. this ends the lesson…

    • Reply
      Joe 5 years ago

      Imagine he didn’t sell then and held his house till now to sell…how much would he have made even after discounting for inflation 😀

      • Reply
        Bluetheimpala 5 years ago

        And if I’d just hit red-18 on that $3k bet I’d be laughing. Or that last money bag on the scratch card. You’re such a plebe dude you made me wince. Tock.BD4L.

  • Reply
    Mel 5 years ago

    Meh, this was bound to happen eventually. The whole market was inflated by bank debt and dirty money.

    Now Banks don’t want to give broke Canadians in insured mortgages, and dirty money is worried to buy.

    Now crappy building construction firms and no skill real estate agents will cry they can’t take part in screwing up our economy and demand policy reversal for their convenience!

    Hopefully we get a real correction vancouver/Toronto that puts home costs more in line with actually salaries.

  • Reply
    DB 5 years ago

    Did you know in 1016 there were 70,000. licensed RE agents in Ontario, 50,000. of them in the GTA. This does not even include their sales teams or their administration people.
    I mention 2016 because that was the record year for total RE transactions, totaling 243,400.
    So who wants to be a realtor now ???.what a joke..the only ones making money here are the brokers, lawyers and of course the govt. Don’t be so naive to think we don’t know how desperate most of you are to make a sale…even to the point of coming here to spew lies in an attempt to convince the readers every thing is fine in OZ. I think you would make good used car sales men/woman since that is what most of us are going to afford before the decade is over. It just may be your next big gig…Seriously consider selling used cars.. 😉

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