The Toronto housing market in 2026 is characterized by declining prices and sales activity compared to previous years, creating conditions that favour buyers. The average residential sale price in the Greater Toronto Area decreased by 5.1 per cent between 2025 and 2026, falling from $1,088,166 to $1,032,207. Sales volumes have also dropped significantly from the peak in 2021, with 62,433 homes sold in 2025 compared to 121,712 in 2021. Key factors influencing the market include higher inflation and interest rates, economic uncertainty, and stretched affordability for first-time buyers.
Current Market Conditions and Prices
The Greater Toronto Area housing market in late 2026 is in a period of adjustment, with prices declining from their previous highs. For September 2026, the benchmark home price, which represents the value of a typical home, was $917,600. This marked a decrease of 4.7 per cent compared to September 2025 and a 0.9 per cent drop from August 2026. The average selling price in the GTA for September 2026 was $1,006,409, which was 5.1 per cent lower than the same month a year earlier. The median price in September 2026 was $860,000, reflecting a year-over-year decline of about 5.4 per cent. Within the City of Toronto itself, the average price for September 2026 was $1,034,320, though the city's benchmark price fell to $908,200. The divergence between average and benchmark prices often indicates a shift in the mix of homes sold rather than a broad-based price increase.
Market activity has cooled considerably from the peak levels seen earlier in the decade. The number of homes sold in the GTA in September 2026 was 5,040, virtually unchanged from August and down 9.0 per cent from September 2025. New listings in the GTA jumped to 16,500 in September 2026, a 36.6 per cent increase from the previous month as sellers returned after the summer. However, new listings remained 14.4 per cent below the level from a year earlier. Active listings rose to 26,131, which was 9.3 per cent lower year-over-year. The sales-to-new-listings ratio, a key indicator of market balance, fell to 30.5 per cent in September 2026 from 41.9 per cent in August, moving the market into buyer-leaning territory.
Annual Trends and Historical Comparison
Examining annual data reveals a clear cooling trend in the Toronto housing market from the highs of 2021. The average residential sale price in the Greater Toronto Area decreased by 5.1 per cent between 2025 and 2026, declining from $1,088,166 to $1,032,207. The number of sales saw a marginal increase of approximately 0.2 per cent over the same period, rising from 37,025 to 37,105. Meanwhile, the total number of listings decreased by 14.5 per cent, from 119,828 in 2025 to 102,482 in 2026. This reduction in supply, coupled with stable but low sales volume, has contributed to the current market dynamics. Looking at a longer timeline, the drop in sales volume from the 2021 peak is stark. Toronto sold 121,712 homes in 2021, but by 2025 that figure had fallen to 62,433 homes, roughly half the volume.
Projections for the remainder of 2026 suggest these trends will continue. Average sale prices for the full year 2026 are expected to decline by approximately 5.5 per cent compared to 2025 levels. The number of sales is projected to decline by approximately 0.5 per cent. The Toronto Regional Real Estate Board has described homebuyers as being in a holding pattern due to ongoing uncertainty around the economy, employment, inflation, and borrowing costs. This caution is reflected in the slowing transaction pace and the increased days on market for properties. The average property spent 51 days on the market in September 2026, and homes sold for an average of 98 per cent of their listing price, indicating retained negotiating power for buyers.
Key Market Indicators and Their Meanings
Several metrics are used to assess the health and direction of the Toronto real estate market. The sales-to-new-listings ratio measures home sales relative to new listings. A ratio below 40 per cent indicates a buyer's market, between 40 and 60 per cent suggests a balanced market, and above 60 per cent signifies a seller's market. In September 2026, the GTA's ratio was 30.5 per cent, firmly in buyer's market territory. Months of inventory is another crucial indicator, calculated by dividing active listings by the sales rate. Between three and five months of supply generally indicates balanced conditions. At the end of September 2026, the GTA had 5.2 months of inventory, which is above the balanced range and favours buyers. Nationally, a seller's market is considered to be below 3.6 months of inventory, while a buyer's market is above 6.4 months.
The MLS Home Price Index benchmark price is designed to track the value of a typical home, filtering out the impact of changes in the mix of properties sold. In contrast, the average sale price can be influenced by a higher proportion of luxury or entry-level homes selling in a given month. In September 2026, the GTA benchmark price fell while the average price rose, highlighting the importance of using multiple metrics. Days on market is a measure of how long a property is listed before selling. The average listing days on market rose to 34 in September 2026 from 33 a year earlier, while average property days on market held steady at 51. These figures, along with the percentage of list price achieved, provide insight into the pace of sales and the balance of power between buyers and sellers.
Price Trends by Housing Type
Price movements vary significantly across different types of housing within the Toronto market. Single-family homes, which include detached and semi-detached properties, command the highest prices. In August 2026, the average selling price for a single-family home in Toronto was $1,128,600, representing a decrease of 4.73 per cent year-over-year and a 1.09 per cent decline from July 2026. Townhouses represent a more affordable segment of the low-rise market. The average selling price for a townhouse in Toronto was $666,500 in August 2026, down 6.18 per cent from a year earlier and falling 1.00 per cent month-over-month. Condominium apartments are typically the most accessible entry point for first-time buyers. The average condo price in Toronto was $531,200 in August 2026, which was 7.07 per cent lower than August 2025 and down 0.75 per cent from the previous month.
The average selling price of a home in Toronto was $925,900 for the month of August 2026. This figure represents a composite average price for all homes in the city. This price was down 0.93% compared to the previous month. It was also down 4.46 per cent from the average price in August of the previous year.
| Housing Type | Average Price (Aug 2026) | Year-Over-Year Change |
|---|---|---|
| Single-Family Home | $1,128,600 | -4.73% |
| Townhouse | $666,500 | -6.18% |
| Condominium Apartment | $531,200 | -7.07% |
| Composite Average | $925,900 | -4.46% |
All major housing segments in Toronto experienced price declines over the year. Condominiums saw the most significant drop among the property types. This broad-based softening reflects overarching market conditions. Higher borrowing costs and economic uncertainty have affected buyer demand across all property types. The market conditions have been described as a buyer's market.
Factors Influencing the 2026 Market
Several economic and policy factors are shaping the Toronto housing market in 2026. Affordability relative to buyers' incomes is cited as the biggest factor preventing more first-time buyers from entering the market. Higher inflation and interest rates have increased the cost of carrying a mortgage, stretching household budgets. Economic uncertainty is also causing many potential buyers to adopt a wait-and-see approach, described by the Toronto Regional Real Estate Board as a holding pattern. The Bank of Canada's monetary policy is a key influence, with fixed mortgage rates experiencing jumps that coincide with market slowdowns. In September 2026, a jump in fixed rates was seen as a contributor to the step back in demand observed that month. National home sales recorded over Canadian MLS Systems fell by 2.3 per cent month-over-month in September 2026, reflecting this broader caution.
Government policies are also playing a role. The federal GST/HST rebate on new homes has helped support new home sales but has not meaningfully changed the path to homeownership, according to industry analysis. The rebate has encouraged greater consideration of new homes as an alternative to resale properties, with the greatest impact seen among new detached homes, semi-detached homes, and townhomes priced up to $1 million. The foreign buyer ban has reportedly reduced new construction development activity while contributing to improved affordability by reducing competition from non-resident buyers. Looking ahead, inflation, interest rates, and economic uncertainty are expected to remain key factors influencing the market through 2027. The demand backdrop remains cautious as uncertainty around the economy, employment, inflation and borrowing costs continues to weigh on purchase decisions.
Common Metrics and Data Sources
Accurate market analysis relies on data from several key organizations. The Toronto Regional Real Estate Board is the primary source for local market statistics, publishing monthly reports on sales, listings, and prices for the Greater Toronto Area. TRREB data is based on transactions conducted through the local Multiple Listing Service system. The Canadian Real Estate Association provides national data and analysis, including the national MLS Home Price Index. CREA's national reports offer context for how the Toronto market compares to other regions across Canada. The Canada Mortgage and Housing Corporation operates the Housing Market Information Portal, which offers free access to housing market data at multiple geographic levels, from national to neighbourhood.
It is important for consumers to understand the limitations and proper use of this data. Average price information can be useful for establishing trends over time but does not indicate actual prices in centres with widely divergent neighbourhoods. The benchmark Home Price Index is often considered a more reliable measure of price change as it aims to track the value of a typical home. Market participants should consult multiple data sources and consider seeking professional advice when making significant financial decisions. The data indicates that the window where softer prices meet ample choice may be narrowing as inventory contracts, a factor buyers and sellers must weigh in their decisions. The information contained in news releases combines both major market and national sales information from MLS Systems from the previous month.
Frequently asked questions
Is the Toronto housing market a buyer's or seller's market in 2026?
The Greater Toronto Area remains a buyer's market as of late 2026. The raw sales-to-new-listings ratio fell to 30.5% in September 2026. The months of supply rose to 5.2, which is within buyer-leaning territory. Homes sold for an average of 98% of the listing price, and average listing days on market rose. Higher inflation, interest rates, and economic uncertainty continue to weigh on market conditions, favouring buyers.
How much have Toronto home prices dropped?
Toronto home prices have declined from their peaks. The average residential sale price in the Greater Toronto Area decreased by 5.1 per cent between 2025 and 2026, falling from $1,088,166 to $1,032,207. As of September 2026, the benchmark price was $917,600, down 4.7 per cent year-over-year. The average selling price in August 2026 was $925,900, a decrease of 4.46 per cent compared to a year earlier. Prices are projected to decline by approximately 5.5 per cent for the full year 2026 compared to 2025.
What is the average house price in Toronto?
The average house price in Toronto varies depending on the metric and time period. For September 2026, the average selling price for all residential properties in the Greater Toronto Area was $1,006,409. The benchmark price, which aims to reflect a typical home, was $917,600 for the same month. In August 2026, the average selling price in Toronto was $925,900. For single-family homes specifically, the average price was $1,128,600 in August 2026, while condominium apartments averaged $531,200.
Why are Toronto home sales down?
Toronto home sales have declined due to a combination of factors including reduced affordability, higher interest rates, and economic uncertainty. Sales volumes dropped to roughly half of the 2021 peak, with 62,433 homes sold in 2025 compared to 121,712 in 2021. Affordability relative to buyers' incomes is the biggest barrier for first-time buyers. The Toronto Regional Real Estate Board notes that uncertainty around the economy, employment, inflation, and borrowing costs has put many homebuyers into a holding pattern, weighing on purchase decisions.
What is the sales-to-new-listings ratio and what does it indicate?
The sales-to-new-listings ratio measures home sales relative to new listings in a given period. It is a key indicator of market balance. An SNLR below 40 per cent indicates a buyer's market, where buyers have more choice and negotiating power. A ratio between 40 and 60 per cent suggests a balanced market, while a ratio over 60 per cent indicates a seller's market with upward pressure on prices. In September 2026, the GTA's ratio was 30.5 per cent, signalling a buyer's market. This was a drop from 41.9 per cent in August 2026, which had indicated balanced conditions.
What factors are affecting the Toronto housing market outlook?
The Toronto housing market outlook is being affected by higher inflation and interest rates, which strain affordability. Economic uncertainty is causing buyers to be cautious. Government policies like the GST/HST rebate have supported new home sales for properties under $1 million but have not fundamentally changed homeownership accessibility. The foreign buyer ban has reduced new construction activity while improving affordability. These factors, along with the expectation that the Bank of Canada may further adjust rates, are projected to influence the market through 2027.
Sources and further reading
- Toronto Housing Market: Oct. 6th, 2026 Update wowa.ca
- Toronto Housing Market Outlook (Fall 2026) blog.remax.ca
- October 16 2026 News Release | CREA Statistics stats.crea.ca
- Housing Market Information Portal www03.cmhc-schl.gc.ca
- Toronto Housing Market | 2026 Home Prices nesto.ca
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