Toronto's Condo Sales Bump Masking Pre-Construction Collapse
AI-generated image · Bay Street Wire
A surge in completed unit sales, driven by bulk buyers and tax rebates, hides a plummeting pipeline of new housing supply.
New condominium sales in the Greater Toronto and Hamilton Area recorded their first annual increase in nearly three years during the second quarter of 2026, according to reporting from the Financial Post.
Data from research firm Urbanation Inc. shows sales rose 52% year-over-year to 702 units. However, this growth was concentrated almost entirely in completed projects, where sales tripled to 535 units. The increase follows Ontario’s enhanced HST rebate and the federal government’s elimination of GST on qualifying new homes, according to the Financial Post. Urbanation president Shaun Hildebrand said it is an important signal to see new condo sales respond to the elimination of HST and investor activity after more than four years of decline, but cautioned that this improvement is coming off an extremely low base and pre-construction demand remains largely dormant.
Despite the headline gain, the market for new builds is cratering. Pre-construction sales plummeted 80% to just 50 units in the second quarter. Robert Kavcic, a senior economist at BMO Capital Markets, stated in a separate report that residential construction is pulling back as pre-sales dry up and projects are either shelved or fail to launch. Kavcic noted that lower resale prices have made new construction relatively uneconomical.
Price disparities further complicate the recovery. Urbanation reported that completed, unsold new condos carried an average asking price of $1,186 per square foot in the second quarter—roughly 43% higher than comparable resale units. Additionally, many of the sales that did occur were negotiated below the asking price, and bulk purchases by investment companies contributed to the volume of completed unit sales.