Toronto Condo Prices Are Plummeting: What It Means for Buyers and Sellers
According to the Toronto Regional Real Estate Board (TRREB), the average price for a typical condo dropped significantly in September 2024. In fact, prices are declining faster than before, making one of the biggest monthly drops ever recorded. It’s now clear that condo prices in the area are in a steep decline, losing value at a record pace.
Condo Prices Are Plunging
The numbers are concerning. The benchmark condo price fell by 2% (or $13,400) in September, bringing it down to $654,300. This marked the fifth month in a row of price declines, and they’re getting bigger each month. September’s drop was the fifth-largest on record, only outdone by three months in 2022 and one month in early 2009. Given that a major easing of interest rates just started, this decline isn’t what many expected.
Falling Prices Despite Lower Mortgage Rates
Even though mortgage rates are dropping, condo prices are still performing poorly. Compared to last year, September prices were 7.2% lower, which translates to a $50,400 loss. Only a handful of months have seen a worse annual price drop, and all were in 2023. This decline is happening quickly, and the market hasn’t seen anything like this since the early 1990s, before Toronto became the city it is today.
Condo Prices Roll Back to 2021 Levels
Condo prices in Greater Toronto have been falling for over two years now. Since the peak in April 2022, prices have dropped by 16.6%, or $129,900. Today, they’re back to where they were in October 2021, erasing nearly three years of growth. With prices trending sharply downward, more declines seem very likely.
Still, it’s not all bad news. Condos are up 22.8% ($121,300) from January 2020, which is decent growth. While that increase hasn’t matched the performance of top U.S. investment indexes, most condo owners aren’t in serious trouble. The real impact will be felt by investors who bought condos expecting big returns, especially those dealing with negative cash flow. But even for them, the losses aren’t likely to be disastrous.
The Big Picture
Toronto condo prices are following trends seen in many other markets. Experts thought lower interest rates would boost demand and prices, but that hasn’t happened. Meanwhile, more properties are hitting the market, rental vacancies are rising, and mortgage delinquencies are creeping up. This combination of factors suggests that the market could stay challenging for a while.
Ready to Navigate the Changing Market?
Whether you’re looking to buy, sell, or invest in Greater Toronto real estate, staying informed is crucial. If you want expert advice or have questions about how these trends impact you, get in touch today. You can reach us by calling or texting at 647-948-7876, or schedule a call through email at info@evolvedrealty.ca.
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